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Government was much smaller at the time of the Industrial Revolution.

Is this true? Is it really such an open-and-shut case?

In some senses it is obviously true: There were a lot fewer people, a lot fewer filing cabinets and a lot fewer regulations. A lot of the tools needed for our big modern system -- hygiene, communications, literacy -- just weren't there yet. There were essentially no worker protections in the early stages of the Industrial Revolution; there were few environmental regulations. And travel and communications were harder, which made it easier to evade certain regulations -- they say that, as late as the 20th century, movie companies relocated to Hollywood in large part because it was the US city farthest from Thomas Edison's patent lawyers.

But government-sanctioned monopolies are not a new invention. (That's what the British East India Company was all about.) Enormous tariffs levied on mass-produced goods are not a new invention. Taxes are not a new invention. Gangs of Luddites (not metaphorical Luddites -- the real thing) who break your equipment and sabotage your business model are not a new invention.

Wine monopolies? Here's a book that deals, in part, with how the English ban on French wine imports boosted the English brewing industry in the 17th century:

And here's a Wikipedia article on mercantilism, the dominant theory of international trade for over 250 years, starting in 1500:

Mercantilism was all about big-government management of the economy through tariffs and subsidies. But, of course, that was arguably a big improvement over the medieval model: Small-government "management" of the "economy" by private armies who threatened to burn your crops and besiege your house unless you paid tribute.

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