Isaac Gervaise, 1680-1739.

French-born businessman in London, and liberal Mercantilist, or more properly, an early Enlightenment thinker.

Isaac Gervaise was born in Paris to a French Huguenot silk-manufacturing family.  Upon the revocation of the Edict of Nantes in 1685, the Gervaise family went into exile.  They found their way to London, where Isaac's father Louis Gervaise, now a naturalized English citizen, had previously (c.1682) set up a new silk manufacturing business.  Isaac was naturalized in 1699 and eventually entered the family business.

Isaac Gervaise's fame rests on a small but formidable 1720 tract,  merely thirty pages, his only publication.  It seems to be directed against John Law's system in France, which was then at its height.  In his tract, Gervaise explained in detail the self-balancing monetary mechanism of a multi-country system of international trade.  Gervaise seemed to believe that there was a "natural" distribution of money ("the grand Denominator") among countries, which he asserts is scaled to population size (more precisely, GDP), and consistent with internal balance (keeping consumption balanced with production) and a zero trade balance.  Any disturbance in this natural monetary distribution will set in motion mechanisms that will automatically correct it.

For example, in Gervaise's analysis, an accidental excess money supply in one country would drive up consumption demand ("Expence of the Rich") above domestic production ("Labour of the Poor"), which can only be met by more imports and fewer exports  (unlike Hume,  Gervaise does not focus on rising prices, but has quantities do the adjusting directly; but the effect would be the same, as rising prices because of excess consumption demand would itself induce more imports and fewer exports).  In either case, excess domestic demand will cause a trade deficit.  These trade deficits would lead to an outflow of gold and silver specie to pay for it. That specie outflow will contract the money supply, and thus set everything in reverse (decline in consumption, falling prices, fall in imports, etc.) and restore both the domestic balance and international trade balance.  So excess money supplies are only temporary, and will be naturally drained out and domestic and international equilibrium restored.

However, this latter part is only true if the supply of money is strictly tied to precious metal.  If the original money supply expansion was engineered artificially by bank credit or paper money, as in Law's system, then this no self-correction mechanism is hamstrung.   Excess credit would drive up consumption artificially, leading to trade deficits and specie outflow, but that outflow would not bring down the money supply and restore equilibrium gently.  Rather, the disequilibrium would continue, specie will drain entirely, until everything eventually come to a dangerous crash. 

Gervaise's gives other more examples of more elaborate temporary disturbances, and works through how they would be corrected. 

In several ways, Gervaise's vision of a self-correcting natural equilibrium system foreshadows that of  Richard Cantillon by a decade. - at least in its overall vision, in the belief in a self-correcting natural equilibrium state.   It some ways, it goes further than Cantillon and Hume and many later Enlightenment thinkers in the way it intricately ties domestic balance and international balance together in one system.

Gervaise's belief in the natural distribution of money and natural equilibrium made him a strong opponent of artificial distortions - not only by Law's bank credit, but also by old Mercantilist government distortions of production and trade. Gervais'e takes a strong position in favor of laissez faire and free trade.

"This consider'd we may conclude, that Trade is never in a better condition, than when it's natural and free; the forcing it either by Laws, or Taxes, being always dangerous: because though the intended Benefit or Advantage be perceived, it is difficult to perceive its Countrecoup; which ever is at least in full proportion to the intended Benefit: Nature not yielding at once, sharpens those Countrecoups, and commonly causes a greater Evil, than the intended Benefit can ballance. Moreover, Trade being a tacit and natural Agreement, to give or furnish a Proportion of certain Denominations of Labour, to be drawn back in like Proportion, in such other Denominations, as best suits Necessity or Fancy; Man naturally seeks, and finds, the most easy and natural Means of attaining his Ends, and cannot be diverted from those Means, but by Force, and against his Will." (Isaac Gervaise, 1720: p.17-18)

Ironically, Gervaise's family business was the Royal Lustring Company, which itself had been granted an English government monopoly charter on the production of glossy silks (lustrings) in 1692.

[Note: Isaac Gervaise the silk-manufacturer and writer of the tract, is sometimes conflated with another contemporary, Isaac Gervais (without the last "e").  This other Isaac Gervais was also of Huguenot descent, but he fled to Ireland (not London), and became an Anglican clergyman and a friend of Bishop George Berkeley,  It is almost certain these are different men.  By coincidence, Berkeley was an enthusiast of Law and a promoter bank credit.]

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