Nationalism is power hunger tempered by self-deception. ~ English author George Orwell
A nation-state is a historical artifact: the product of power over peoples, and, occasionally, of people revolting against power. States vary considerably in character, by their history, and geographic circumstances.
In the early modern period, most continental powers were absolute monarchies. England’s monarchy was more measured, in the crown being checked by social contract dating from the early 13th century. In contrast, the United Provinces, Swiss, and Hanseatic cities had burgher republics.
Whatever their schisms in sovereignty, all states at the time shared a commonality: nationalism rested upon the upper class, not the mass of its people. Differences in economic policy depended upon the composition and interests of the ruling classes.
Sovereign wishes superseded all other concerns in absolute monarchies. Whatever scant understanding they may have had of economics, kings were accustomed to having their orders obeyed.
Day-to-day administration of kingdoms filtered through a hierarchy of ministers and civil servants who were unfamiliar with commercial and industrial enterprise. Their concerns echoed the attitudes and values of their master.
Regulations added to the cost of doing business. This engendered evasion.
Ignorance and indifference meant that monarchs often sacrificed the economic well-being of subjects, and by doing so undermined the foundation of their own power.
In the 16th century, Spanish kings relied upon regressive taxes for revenue. With 97% of the land being owned by 2% of the population, landowners were exempt from taxation. The tax burden fell upon artisans and tradesmen, and especially peasants. Hence, in spite of a great empire, with vast quantities of monetary metals flowing from their colonies, Spain’s rulers continually outspent their income while hindering commerce, ensuring inexorable decline.
Even France, the most populous and powerful European nation, struggled to support the territorial ambitions and pomp of Louis XIV’s court. When Louis the Great died in 1715, the staunch advocate of the divine right of kings and grand government centralizer left as a legacy a country on the brink of bankruptcy.
In contrast, the United Netherlands had an absolute monarchy of merchants. The wealthy commercial class controlled the principal cities with a more informed economic program. Themselves having prospered from trade, they knew well enough not to view commerce as a form of undeclared war. Their ports and markets were welcome to merchants of all nations.