IN DEFENSE OF MONOPOLY: MERCHANT GUILDS AND THE EMERGENCE OF LIBERALISM IN PORTUGAL

Despite being questioned and criticized since classical antiquity, monopolistic institutions and practices have persisted for centuries. Indeed, they remain a contentious issue in modern-day political debates. Some have argued that the longevity of monopolistic institutions, such as guilds, was the result of political arrangements with public authorities. Others, however, claim that they persisted because they were useful and efficient institutions (for example, they were a means of knowledge transfer that ultimately helped Europe surpass Asia in wealth, technology, and global influence). Much less discussed is how such institutions defended themselves in the public arena against widespread criticism. Drawing upon underexplored source material held in the Portuguese National Archives (Arquivo Nacional da Torre do Tombo, ANTT), this article examines how Portuguese commercial guilds justified their monopolies and privileges in the early 1820s. The article shows that while the defense of monopolies did involve economic justifications, it nonetheless mostly emphasized the social impacts of commercial monopolies (positive externalities), in particular the formation of a reliable class of merchants and citizens.