The economic history of France involves major events and trends, including the elaboration and extension of the seigneurial economic system (including the enserfment of peasants) in the medieval Kingdom of France, the development of the French colonial empire in the early modern period, the wide-ranging reforms of the French Revolution and the Napoleonic Era, the competition with the United Kingdom and other neighboring states during industrialization and the extension of imperialism, the total wars of the late-19th and early 20th centuries, and the introduction of the welfare state and integration with the European Union since World War II.
Medieval and early modern France experienced periods of economic growth, as well as challenges such as wars, plagues, and social inequality. The economy relied heavily on agriculture, trade, and the production of luxury goods, and the power and influence of the monarchy played a significant role in shaping economic policies and development. In the late 18th century, French industries faced challenges from competition with England, leading to an industrial depression. The American War of Independence had mixed effects on trade, while the French economy experienced setbacks, including agricultural price reductions and debt accumulation.
France experienced a mix of growth, stagnation, and setbacks during the period from 1789 to 1914. It faced economic challenges related to the French Revolution, Napoleonic wars, protectionism, and industrialization. While France made some advancements in banking and finance, it fell behind other nations in terms of industrial development. Colonialism played a complex role in France's economic and geopolitical landscape. While it provided economic benefits and resources, it also had consequences for the colonized peoples, including exploitation, cultural assimilation, and the suppression of local autonomy.
In 1914-1944, World War I, the interwar period, and the German occupation during World War II had significant impacts on the French economy, resulting in economic challenges, inflation, labor unrest, and hardship for the population.
During the Trente Glorieuses, from 1947 to 1973, France experienced a booming period with an average annual growth rate of 5%. The population grew rapidly, fueled by a high birth rate and declining mortality rate. The economy's growth was driven by productivity gains and increased working hours, as well as investment in targeted industries, regions, and products through indicative planning. The government played a significant role in directing investment and supporting industries of strategic national importance.
During the 1980s France faced economic troubles including a short recession. This led to a shift away from dirigisme, or state intervention, towards a more pragmatic approach. Economic growth resumed later in the decade but was hindered by the economic depression in the early 1990s, which affected the Socialist Party. Jacques Chirac's liberalization measures in the late 1990s strengthened the economy. However, the global economic stagnation after 2005 and the 2008 global crisis had adverse effects on France and the Eurozone, causing difficulties for Nicolas Sarkozy's conservative government.
Medieval France
The collapse of the Roman Empire unlinked the French (Franks) economy from Europe. Town and city life and trade declined and society became based on the self-sufficient manor. What limited international trade existed in the Merovingian age — primarily in luxury goods such as silk, papyrus, and silver — was carried out by foreign merchants such as the Radhanites.
Agricultural output began to increase in the Carolingian age as a result of the arrival of new crops, improvements in agricultural production, and good weather conditions. However, this did not lead to a revival of urban life; in fact, urban activity further declined in the Carolingian era as a result of civil war, Arab raids, and Viking invasions. The Pirenne hypotheses posits that this disruption brought an end to long-distance trade, without which civilization retreated to purely agricultural settlements, and isolated military, church, and royal centers. When trade revived these centers became the nucleus of new towns and cities around which suburbs of merchants and artisans grew.
The High Middle Ages saw a continuation of the agricultural boom of the Carolingian age. In addition, urban life grew during this period; cities such as Paris expanded dramatically.
The 13 decades from 1335 to 1450 spawned a series of economic catastrophes, with bad harvests, famines, plagues, and wars that overwhelmed four generations of the French. The population had expanded, making the food supply more precarious. The bubonic plague ("Black Death") hit Western Europe in 1347, killing a third of the population, and it was echoed by several smaller plagues at 15-year intervals. The French and English armies during the Hundred Years War marched back and forth across the land; they ransacked and burned towns, drained the food supply, disrupted agriculture and trade, and left disease and famine in their wake. Royal authority weakened, as local nobles became strongmen fighting their neighbors for control of the local region. France's population plunged from 17 million to 12 million in 130 years. Finally, starting in the 1450s, a long cycle of recuperation began.Roger Price, A Concise History of France (1993) pp 41-46
Early modern France
Figures cited in the following section are given in livre tournois, the standard "money of account" used in the period. Comparisons with modern figures are extremely difficult; food items were comparatively cheap, but luxury goods and fabrics were very expensive. In the 15th century, an artisan could earn perhaps 30 livres a year; a great noble could have land revenues from 6,000 to 30,000 livres or more.Kendall, Paul Murray. Louis XI: The Universal Spider (New York : Norton, 1971) , p. 12. A late seventeenth-century unskilled worker in Paris earned around 250 a year,DeJean, Joan. The Essence of Style: How the French Invented Fashion, Fine Food, Chic Cafés, Style, Sophistication, and Glamour (New York: Free Press, 2005) , , p. 15. while a revenue of 4,000 livres a year maintained a relatively successful writer in modest comfort.Viala, Alain, Naissance de l'écrivain (Paris: Eds. de Minuit, 1985) , p.113, Collection: Le sens commun. At the end of the 18th century, a well-off family could earn 100,000 livres by the end of the year, although the most prestigious families could gain twice or three times that much, while, for provincial nobility, yearly earnings of 10,000 livres permitted a minimum of provincial luxury.
Renaissance
The economy of Renaissance France was, for the first half-century, marked by dynamic demographic growth and developments in agriculture and industry. Until 1795, France was the most populated country in Europe and the third most populous country in the world, behind only China and India. With an estimated population of 17 million in 1400, 20 million in the 17th century, and 28 million in 1789, its population exceeded that of even Russia and was twice the size of Britain and the Dutch Republic. In France, the Renaissance was marked by a massive increase in urban populations, although on the whole, France remained a profoundly rural country, with less than 10% of the population located in urban areas. Paris was one of the most populated cities in Europe, with an estimated population of 650,000 by the end of the 18th century.
Agricultural production of a variety of food items expanded, including olive oil, wine, cider, woad (Fr. "pastel", a source of blue dye), and saffron. Southern France grew artichokes, melons, romaine lettuce, eggplant, salsifies, celery, fennel, parsley, and alfalfa. After 1500 New World crops appeared such as beans, corn (maize), squash, tomatoes, potatoes, and bell peppers. Production techniques remained attached to medieval traditions and produced low yields. With the rapidly expanding population, additional land suitable for farming became scarce. The situation was made worse by repeated disastrous harvests in the 1550s.
Industrial development greatly affected printing (introduced in 1470 in Paris, 1473 in Lyon) and metallurgy. The introduction of the high-temperature forge in northeast France and an increase in mineral mining were important developments, although it was still necessary for France to import many metals, including copper, bronze, tin, and lead. Mines and glasswork benefited greatly from royal tax exemptions for a period of about twenty years. Silk production (introduced in Tours in 1470 and in Lyon in 1536) enabled the French to join a thriving market, but French silk remained of lesser quality than Italian silks. Wool production was widespread, as was the production of linen and of hemp (both major export products).
After Paris, Rouen was the second largest city in France (70,000 inhabitants in 1550), in large part because of its port. Marseille (French since 1481) was France's second major port: it benefited greatly from French trading agreements signed in 1536 with Suleiman the Magnificent. To increase maritime activity, Francis I founded the port city of Le Havre in 1517. Other significant ports included Toulon, Saint Malo and La Rochelle.
Lyon was the center of France's banking and international trade markets. Market fairs occurred four times a year and facilitated the exportation of French goods, such as cloth and fabrics, and importation of Italian, German, Dutch, and English goods. It also allowed the importation of exotic goods such as silks, alum, glass, wools, spices, and dyes. Lyon also contained the houses of most of Europe's banking families, including Fugger and Medici. Regional markets and trade routes linked Lyon, Paris, and Rouen to the rest of the country. Under Francis I and Henry II, the relationships between French imports and the exports to England and to Spain were in France's favor. Trade was roughly balanced with the Netherlands, but France continually ran a large trade deficit with Italy due to the latter's silks and exotic goods. In subsequent decades, English, Dutch and Flemish maritime activity would create competition with French trade, which would eventually displace the major markets to the northwest, leading to the decline of Lyon.
Although France, initially more interested in the Italian Wars, arrived late to the exploration and colonization of the Americas, private initiative and piracy brought Bretons, Normans and Basques early to American waters. Starting in 1524, Francis I began to sponsor exploration of the New World. Significant explorers sailing under the French flag included Giovanni da Verrazzano and Jacques Cartier. Later, Henry II sponsored the explorations of Nicolas Durand de Villegaignon who established a largely Calvinist colony in Rio de Janeiro, 1555–1560. Later, René Goulaine de Laudonnière and Jean Ribault established a Protestant colony in Florida (1562–1565) (see French colonization of the Americas).
By the middle of the 16th century, France's demographic growth, its increased demand for consumer goods, and its rapid influx of gold and silver from Africa and the Americas led to inflation (grain became five times as expensive from 1520 to 1600), and wage stagnation. Although many land-owning peasants and enterprising merchants had been able to grow rich during the boom, the standard of living fell greatly for rural peasants, who were forced to deal with bad harvests at the same time. This led to reduced purchasing power and a decline in manufacturing. The monetary crisis led France to abandon (in 1577) the livre as its money of account, in favor of the écu in circulation, and banning most foreign currencies.