John Law (economist) in the context of "John Law's Company"

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⭐ Core Definition: John Law (economist)

John Law (pronounced [lɑs] in French in the traditional approximation of Laws, the colloquial Scottish form of the name; 21 April 1671 – 21 March 1729) was a Scottish-French economist and financier. He rose to power in France where he created a novel financial scheme for French public finances known as Law's System (French: le système de Law) with two institutions at its core, John Law's Bank and John Law's Company (also known as the Mississippi company), ending in the devastating boom and bust "Mississippi Bubble" of 1720.

Born in Scotland, Law was an accomplished gambler with an interest in the rules of probability. After killing a man in a duel and being sentenced to death, he fled to mainland Europe. He read economics and made the acquaintance of Philippe II, Duke of Orléans, who became regent for the juvenile Louis XV in 1715. In 1716 Philippe approved Law's plan to create a private bank which would take gold deposits in return for bank notes, loaning out the gold. It was structured as a joint-stock company and was bought by the French government in 1718, becoming the Banque royale. In 1717 Law founded another joint-stock company, the Mississippi company, whose purpose was the economic exploitation of Louisiana as well as other French colonies. Law became Controller General of Finances in 1720 and was the richest man in Europe. He had to leave France that same year, as a stock boom turned into a bust. He then lived in various European cities and died in Venice, impoverished.

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👉 John Law (economist) in the context of John Law's Company

John Law's Company, founded in 1717 by Scottish economist and financier John Law, was a joint-stock company that occupies a unique place in French and European monetary history, as it was for a brief moment granted the entire revenue-raising capacity of the French state. It also absorbed all previous French chartered colonial companies and was popularly known as the Compagnie du Mississippi (Mississippi Company), even though under Law's leadership its overseas operations remained secondary to its domestic financial activity.

In February 1720, the company acquired John Law's Bank, which had been France's first central bank. The experiment was short-lived, and after a stock market collapse of the company's shares in the second half of 1720 (the Mississippi Bubble), the company was placed under government receivership in April 1721. It emerged from that process in 1723 as the French Indies Company, focused on what had been the overseas operations of Law's Company.

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John Law (economist) in the context of French Indies Company

The French Indies Company (French: Compagnie française des Indes orientales) was the main French overseas trading company during most of Louis XV's long reign in the 18th century. It emerged in March 1723 from the reorganization of John Law's Company following the termination of John Law's giant monetary experiment which the company had channelled. As a delayed consequence of the Seven Years' War, the company's privilege was eventually withdrawn in 1769, and the company was liquidated the next year.

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John Law (economist) in the context of Richard Cantillon

Richard Cantillon (French: [kɑ̃tijɔ̃]; 1680s – May 1734) was an Irish-French economist and author of Essai Sur La Nature Du Commerce En Général (Essay on the Nature of Trade in General), a book considered by William Stanley Jevons to be the "cradle of political economy". Although little information exists on Cantillon's life, it is known that he became a successful banker and merchant at an early age. His success was largely derived from the political and business connections he made through his family and through an early employer, James Brydges. During the late 1710s and early 1720s, Cantillon speculated in, and later helped fund, John Law's Mississippi Company, from which he acquired great wealth. However, his success came at a cost to his debtors, who pursued him with lawsuits, criminal charges, and even murder plots until his death in 1734.

Essai remains Cantillon's only surviving contribution to economics. It was written around 1730 and circulated widely in manuscript form, but was not published until 1755. His work was translated into Spanish by Gaspar Melchor de Jovellanos, probably in the late 1770s, and considered essential reading for political economy. Despite having much influence on the early development of the physiocrat and classical schools of thought, Essai was largely forgotten until its rediscovery by Jevons in the late 19th century. Cantillon was influenced by his experiences as a banker, and especially by the speculative bubble of John Law's Mississippi Company. He was also heavily influenced by prior economists, especially William Petty.

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John Law (economist) in the context of Régence

The Régence (French pronunciation: [ʁeʒɑ̃s], Regency) was the period in French history between 1715 and 1723 when King Louis XV was considered a minor and the country was instead governed by Philippe II, Duke of Orléans (a nephew and son-in-law of Louis XIV of France) as prince regent. This was not the only regency in French history, but the name is nevertheless associated with this period.

Philippe was able to take power away from Louis-Auguste, Duke of Maine (illegitimate son of Louis XIV and Madame de Montespan) who had been the favourite son of the late king and possessed much influence. From 1715 to 1718 the Polysynody changed the system of government in France, in which each minister (secretary of state) was replaced by a council. The système de Law was also introduced, which transformed the finances of the bankrupted kingdom and its aristocracy. Both Cardinal Dubois and Cardinal Fleury were highly influential during this time.

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John Law (economist) in the context of Cramond

Cramond Village (/ˈkræmənd/; Scottish Gaelic: Cair Amain) is a village and suburb in the north-west of Edinburgh, Scotland, at the mouth of the River Almond where it enters the Firth of Forth.

The Cramond area has evidence of Mesolithic, Bronze Age and Roman activity. In modern times, it was the birthplace of the Scottish economist John Law (1671–1729). Cramond was incorporated into the City of Edinburgh by the Edinburgh Boundaries Extension and Tramways Act 1920 (10 & 11 Geo. 5. c. lxxxvii).

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