The services sector, 1700–1870

Within Europe the picture was more varied.” [p. 205]. Finally, the last method of evaluating productivity gains in wholesale is understood in connection with the introduction of new goods into the European markets which tells the story of the impact across Europe of early globalization, which made consumers familiar with, and regular purchasers of, a greater variety of goods. Thus, “Amsterdam, Europe’s prime commercial hub of the seventeenth century, stagnated throughout the eighteenth century, illustrating another characteristic feature of European development: the successive leadership of different regions throughout time” [p. 206].
To prove their position, the authors supply readers with an example: in the early eighteenth century a local grain supply shock in Paris might only have affected northern Italian markets after a delay of two to three years, which in fact demonstrates that the distribution of and since that time has made its significant role in price policy. However, being a rule, it has its exceptions: from the late fifteenth century large-scale shipments between the Baltic city of Gdansk and Amsterdam made up grain deficiencies in the Netherlands. On the other hand, market efficiency increased slowly, as over the course of the eighteenth century adjustment times between markets probably halved overall and political boundaries made the process only worse. Nonetheless, “in the later eighteenth century price movements were largely synchronized within the internal markets of France and Spain, even if true price convergence between markets remained elusive inmost of continental Europe” [p. 206].
In general, the subparagraph is devoted to looking into distribution features and is rather detailed and consistent. For instance, Grafe, Neal and Unger write that town or regional authorities engaged in government-sponsored missions to buy grain abroad which led to the international grain trade prohibited or subject to very high tariff rates in many places; that caused a wide range of voices against such regulation throughout the early and mid-eighteenth century. What is more, it appeared later that free trade was no solution for badly integrated markets; large producers could ration supplies; prices and the services sector unpredictability rose – that altogether illustrated a central problem of the development of markets and distribution networks. Therefore, it is not surprising that by the early nineteenth century many aspects of the organizational structure of marketing networks had been fundamentally transformed: beginning in England the travelling salesman became the agent of integration in the eighteenth century; specialist factors represented large firms across the country creating their own distribution systems; the creation of the large industrial firm changed production and the way in which marketing was organized and so on and so forth. The changes were not so numerous but of high importance, the improvements in transport services and finance discussed above clearly contributed to the slowly increasing efficiency of marketing in Europe before the 1800s.
It is also possible to talk about the slow and steady freeing of markets from political and corporate control contributes in the long run. Increased purchasing power of larger numbers of European consumers, changing tastes, and a rising longing for more complicated and wide-ranging consumer goods began characterizing country areas as they had towns previously. The interactions between political and economic market integration as well as changing demand patterns were multi-dimensional and complementary. The dynamism of market development and wholesale distribution was rooted in the fact that improvements in one area increased the benefits from advances in another.
Conclusion
After studying the given chapter in ‘The Cambridge Economic History of Modern Europe (1700-1870)’ and analyzing services sector in the period of time, the following conclusion can be made. In 1700–1870 investment in physical and human capital devoted to services were never subject to diminishing returns during peacetime. The increasing scale of conflicts both on land and sea led to economies of scale in significant parts of the services sector, especially shipping and distribution. Despite the increased scale of shipping and distribution services and the creation of the railroad network of continental Europe, interest rates remained at the low levels already obtaining in the Netherlands by 1700.
Each advance infinance, shipping, or distribution led to spin-offs of improved productivity in the rest of the sector. Increased marketability of various products available to European consumers from around the world surely stimulated advances in the productivity of European agriculture and then European manufacturing. Enlarged markets, in turn, created incentives for further improvements in finance, shipping, and distribution. The responses to the incentives, however, depended on the institutional framework within which firms operated. What is more, the pleasant plot of theoretical knowledge being represented by Regina Grafe, Larry Neal, and Richard W. Unger is that the French revolution is viewed in the focus of the study without engage in a digression.
It is also significant to mention that the study of services sector in the given source brings the question of when globalisation has actually started and whether we can track it; on the other hand, it can be claimed that by 1700–1870, finance, shipping and distribution has already been involved and depended on global processes. The additional question is whether the nowadays society as well as men can learn by the past experience and avoid at least some of the upcoming mistakes in finance and distribution.
Bibliography
Grafe, R., Neal, L., Unger, R. W. (2010) The Services Sector in The Cambridge Economic History of Modern Europe (1700-1870). Cambridge University Press, New York. Pp. 187-213.











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