The Franco‐German trade puzzle: an analysis of the economic consequences of the Franco‐Prussian war¹

Abstract

When the Franco‐German trade relationship is viewed from a long‐term perspective, the conventional view that trade ties were rather good before 1914 becomes doubtful. In fact, trade statistics point to the absolute and relative decline in trade flows between the two countries after the Franco‐Prussian war of 1870–1. This postwar episode of Franco‐German trade history is far from incidental. On the basis of a comprehensive study of Franco‐German trade by product, this article reveals a complete restructuring of French trade with Germany after the conflict and invites a new analysis of its economic consequences.

Currency devaluations and beggar‐my‐neighbour penalties: evidence from the 1930s

“…This is reflected in the scarcity of studies using bilateral tariff data. Among the few works that come to mind are Dedinger, ‘Franco‐German trade puzzle’, and Varian, ‘Anglo‐American trade costs’, on the late nineteenth century, and Hayakawa, ‘Omission’, on modern trade data.…”

National Borders and Urban Growth: Evidence from the Annexation of Alsace and Lorraine

“…These changes were partially due to rapid industrialisation in Germany. Nevertheless, Dedinger (2012) stresses the role of the annexation of Alsace-Lorraine in this trade shift. The region had been home to 4.2 per cent of the French population, but 5.5 per cent of the national industrial workforce.…”

“…As Dedinger (2012) notes, Germany was one of France's three major trade partners before 1913, contributing 9 per cent of French external trade volume in 1847-1913. Prior to the Franco-Prussian War, France exported manufactured goods to Germany and imported mostly food and raw materials.…”

Stages of diversification: France, 1836–1938

“…Indeed, the share of France in world exports increased from 9% in 1847 to 16% in 1865 but this figure quickly fell thereafter attaining 7% in 1913. Compared to other European countries, the French "decline" appears to be unique (Lewis, 1981;Federico and Wolf, 2011;Dedinger, 2012;Huberman et al, 2015). Crouzet (2003) blames the apparent slow growth of French exports after 1860 on a rise in wages induced by a 'shortage of labor'.…”