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2H France in Revolution, 1774–1815

The Financial Crisis of the Ancien Regime

  • 2 things to know
  • Component 2

Overview

Recall questions on the state of royal finances in 1774 and on the wars, court spending and inefficient taxation behind the deficit.

What you need to know

Answer each one before you reveal it.

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Key term

What was the state of the royal finances when Louis XVI came to the throne in 1774?

Key term

When did Turgot serve as Controller-General of Finances and what economic philosophy guided his reforms?

Questions from this subtopic

Each one with the model answer underneath.

  1. 1

    What was the state of the royal finances when Louis XVI came to the throne in 1774?

    Model answer

    Expenditure ran at about 400 million livres against receipts of roughly 372 million, an annual deficit of around 27 million, on top of debt inherited from earlier wars. Intervention in the American war then transformed the position.

  2. 2

    How did expensive wars contribute to the financial crisis?

    Model answer

    War costs, particularly from involvement in conflicts like the American War of Independence, were a major structural cause of the financial crisis.

  3. 3

    How did court expenditure at Versailles contribute to the financial crisis?

    Model answer

    Extravagant court spending at Versailles was a significant drain on royal finances.

  4. 4

    Why was tax collection inefficient under the Ancien Régime?

    Model answer

    Tax collection was inefficient because it was conducted through tax farmers who took a portion of revenue for themselves.

  5. 5

    How did privileged exemptions contribute to the financial crisis?

    Model answer

    The inability to tax the privileged orders (nobility and clergy) limited the Crown's revenue base.

  6. 6

    When did Turgot serve as Controller-General of Finances and what economic philosophy guided his reforms?

    Model answer

    Turgot served from 1774 to 1776, attempting physiocratic reforms based on free trade and reduced government intervention.

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