In addition to rising costs due to war, the state faced growing expenditures for domestic programs. These programs included building roads, reconstructing public buildings, and keeping tighter surveillance over urban populations, especially the poor. Despite these initiatives, the government was able for a time to roughly balance the budget. After the Law debacle, the monarchy experimented with a variety of new taxes to tap the wealth of a broader segment of the population, although political pressures prevented full implementation. The state also required peasants and day laborers to work a shift each year on state road crews.
After the War of the Austrian Succession broke out in 1740, however, the government was forced to borrow increasingly large sums, and by 1748 it had already added 200 million livres to its debt. (The livre was worth about 7.25 grams of silver in 1700 and declined to about 4.5 grams by 1785.) This debt would have certainly been higher had the economy not begun to improve and the tax base widened.
Economic expansion resulted in part from the growth of population, which had stagnated around 1560 and grew little if at all for the next century and a half.
In 1715 the population stood at about 23 million; in 1745 it was about 25 million; by 1789 it reached around 28 million. These moderate increases can be explained in part by a decline in the death rate, which was in turn due to a reduction in plague and war-related deaths. Modest improvements in food production and better transportation of grain to areas hard-hit by famine also contributed to population growth.
Famine, which occurred often during the 17th century, was less severe and frequent between 1710 and 1789. Manufactures grew, and by 1789 their value roughly equaled the value of all agricultural products. Moreover, between 1716 and 1789 foreign trade tripled, enriching in particular major port cities, such as Marseille, Bordeaux, and Nantes. The fastest growing sector of the economy was colonial trade, which increased tenfold during the 18th century.
The major source of colonial wealth was the French Caribbean possessions, including Saint-Domingue (present-day Haiti), which had nearly half a million slaves by 1789. Although France lost most of its possessions in North America, including Canada, to Britain in 1763, it kept its valuable colonies in the West Indies for several more decades. The benefits of this economic growth were not spread evenly. Poorer peasants and communities far from major trade routes gained little. Inflation, which caused prices to double between 1720 and 1789, ate up the wage increases of many workers. But urban populations, especially the middle class, flourished. The middle class benefited from new ways to earn a living (in trade and the professions) and spent more on a growing variety of products that made life more comfortable and interesting. These ranged from medical devices and services to books and newspapers. "France" © Emmanuel BUCHOT, Encarta, Wikipedia.
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