Financial speculation in the Dutch Golden Age
In a recent review in the May 24 National Post Ingrid D. Rowland praises Anne Goldgar’s Tulipmania: Money, Honor, and Knowledge in the Dutch Golden Age for its revealing look at the speculative trading in tulip bulbs in seventeenth century Netherlands. As popular opinion has it, the Dutch obsession with tulips led to an unprecedented crash in the Dutch financial markets as demand for the bulbs waned. But as Rowland’s review points out, Goldgar’s new book reveals that “most of what we ‘know’ about tulip mania is pure fiction.…” and, in fact, the supposed crash of the Dutch tulip industry was more a social phenomenon than an economic one. Rowland writes:
Dutch tulip prices would have had to find their equilibrium: The heights they reached in 1636 were an experimental extreme. But two outside factors, as Goldgar shows convincingly, made the market’s abrupt shifts in February, 1637, look like a cataclysm. The first was an outbreak of bubonic plague that erupted in 1636, bringing on its usual train of death and panic, but also an unusual number of wills whose provisions involved tulip bulbs and tulip transactions. The second was that the crash came in Carnival season, with its ritual rebellion against every kind of propriety. In a culture as carefully regulated as that of Holland, carnival craziness provided a crucial outlet for social tensions, but even when regulated by calendar and ceremony, the topsy-turvy carnival world was as disconcerting as a painting by Breughel or Bosch. In a plague year, those tensions and those discomfitures were all the greater, compounded by real fears that this time God’s wrath would be implacable.
Tulips simply provided these long-standing aspects of the human condition with an irresistible symbol, just as the intangible evanescence of the Internet recently lent a certain suggestive aura to a similar quick shift in dot-com prices. The real problem, as this arresting book concludes, lies not in tulips, nor even in capitalism, but in ourselves—in the elusive but persistent ways in which we ascribe value to people, or things, or ideas.