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  • Another Look at ‘The Rise of the West’ – But With Better Numbers

    Posted by T. Greer on November 24th, 2013 (All posts by )


    Originally published at The Scholar’s Stage on 20 November 2013.

    Why the West? I do not think there is any other historical controversy that has so enthralled the public intellectuals of our age.  The popularity of the question can probably be traced to Western unease with a rising China and the ease with which the issue can be used as proxy war for the much larger contest between Western liberals who embrace multiculturalism and conservatives who champion the West’s ‘unique’ heritage.

    A few months ago I suggested that many of these debates that surround the “Great Divergence” are  based on a flawed premise–or rather, a flawed question. As I wrote: 

    Rather than focus on why Europe diverged from the rest in 1800 we should be asking why the North Sea diverged from the rest in 1000.” [1]

    I made this judgement based off of data from Angus Maddison‘s Contours of the World Economy, 1-2030 AD and the subsequent updates to Mr. Maddison’s data set by the scholars who contribute to the Maddison Project.

    As far as 1,000 year economic projections go this data was pretty good. But it was not perfect. In many cases–especially with the Chinese data–it was simply based on estimates and extrapolations from other eras. A more accurate view of the past would require further research.

    That research has now been done. The economic historian Stephen Broadberry explains:

    As it turns out, medieval and early modern European and Asian nations were much more literate and numerate than is often thought. They left behind a wealth of data in documents such as government accounts, customs accounts, poll tax returns, Parish registers, city records, trading company records, hospital and educational establishment records, manorial accounts, probate inventories, farm accounts, tithe files. With a national accounting framework and careful cross-checking, it is possible to reconstruct population and GDP back to the medieval period. The picture that emerges is of reversals of fortune within both Europe and Asia, as well as between the two continents. [2]

    Drawing on a multiple specialized studies, Mr. Broadberry is able to create a table that is more accurate than the one I used earlier:

    Taken from Stephen Broadberry. “Accounting for the Great Divergence.” voxEU.org. 16 November 2013.

    There are a few things here worth commenting on.



    The greatest difference between Mr. Maddison and Mr. Broadberry’s numbers concern China. Maddison’s Chinese only experienced “extensive growth” — that is to say, the total GDP of China increased over time, but the wealth available to the average Chinese peasant did not change. China’s wealth increased because it had more people, not because these people were getting richer.

    Broadberry’s data presents a more nuanced picture. In it we can clearly see the economic “efflorescence” of China’s medieval economic revolution and the wealth that came with the mid-Ming economic reforms. In many of these periods the average Chinese man was more wealthy than his European counterpart. China was far from stagnant for 1,000 years. 

    But it also never had sustained economic growth. As happened across the premodern world, successful dynasts would establish a system that allowed commerce to flourish, urban centers to grow, and wealth to increase. In the words of Jack Goldstone, these societies would undergo an economic “efflorescence” that historians of later days would remember as a Golden Age [3]. These Golden Ages would not last. After a few centuries these societies would push agrarian civilization to its limits and contraction would begin.

    This process is seen quite clearly in the Chinese data. The decline in GDP per capita between 1600 and 1750 hides the fairly impressive economic achievements of the early Qing: despite a fourfold (!) increase in population, Chinese living standards remained on par with most of Europe, even though most of this expansion was happening in unproductive, virgin lands far away from China’s traditional urban centers while expensive levies were continually raised to pay for one war after another. [4] Alas, this type of efflorescence could not endure; as the centuries passed the condition of the Chinese peasant plummeted. It is sobering to realize that the average Chinese of 1000 was twice as rich as his descendents were 850 years later.

    Broadberry’s data for Western Europe and India are very similar to the data sets compiled by Maddison and company. In both data sets India’s GDP per capita starts at a fairly low point and then falls over the centuries. By 1200 Western Europe has a GDP per capita higher than most parts of the world, but (with two exceptions ) by 1500 this number stops increasing. In both data sets the two exceptions are Netherlands and Great Britain. These North Sea economies experienced sustained GDP per capita growth for six straight centuries. The North Sea begins to diverge from the rest of Europe long before the ‘West’ begins its more famous split from ‘the rest.’

    There is an important difference between Madison’s and Broadberry’s data sets, however. Madison worked in 500 year intervals. Broadberry’s sources are much more specific. With his data we can pin point the beginning of this ‘little divergence’ with greater detail. In 1348 Holland’s GDP per capita was $876. England’s was $777. In less than 60 years time Holland’s jumps to $1,245 and England’s to 1090. The North Sea’s revolutionary divergence started at this time. 

    Acknowledging this leaves us with a different set of questions than the ones that animate the traditional “Why the West?” debates. It forces us to look past industrialization and colonization and pay attention to deeper changes of earlier eras. Broadberry’s short analysis tries to do just that. I encourage you to read it. I do not agree entirely with his explanation – but he, at least, is trying to answer the right questions.

    A note to ChicagoBoyz readers: I recommend reading the original essay this post was meant to amend, “The Rise of the West: Asking the Right Questions.” In said essay I give the rational for focusing on GDP per capita instead of other measures of economic growth and explain why the ‘Great Divergence’ of the 1800s is not as mysterious as it is often presented to be. The comment section of that post was also of unusual quality.



    ————————————————————-



    [1] T. Greer. “The Rise of the West: Asking the Right Questions.” The Scholar’s Stage. 7 July 2013.

    [2] Stephen Broadberry. “Accounting for the Great Divergence.” voxEU.org. 16 November 2013.

    [3]  Jack A. Goldstone. “Efflorescences and Economic Growth in World History: Rethinking the “Rise of the West” and the Industrial Revolution. Journal of World History. vol 13, issue 2 (2002). 323-389.

    [4] ibid., 339-353.

     

    10 Responses to “Another Look at ‘The Rise of the West’ – But With Better Numbers”

    1. ErisGuy Says:

      So having read the linked posts, was it new family formation (and if so, what will the new normal family of our times create?), the use of coal (and if so, what will the neglect of nuclear power in our time lead to?), the asymmetric shocks of warfare and disease (and if so, what will the future hold?), or the malice or indifference of the state (and if so, how will the triumph of socialism with its hoards of bureaucrats affect the economy?)?

      The purpose of an inquiry into how riches were won in the past is to continue to win riches in the future. As best I can see—and many disagree—the ideologies of the former West: environmentalism, socialism, et. al., are all similar to the malicious governments which repressed growth, and the new normal social arrangements are similar to the social arrangements which impeded development.

      In citing that the ideas attributed to Adam Smith have been perennially discovered as the sources of wealth then discouraged by governments because rulers want control, leads me to ask: when will people learn?

    2. dearieme Says:

      It looks as if England/GB accelerated as soon as it no longer had to subsidise the North American colonies.

    3. Assistant Village Idiot Says:

      I agree with both the above comments.

      Let me add – there is something about the encounter of Christianity with NW Europe that was different from the encounter of NW Europe and other cultures and Christianity and other cultures. It is easy to make up theories about predictable universe/regard for the individual/IQ increase from outbreeding/intense selection of Jews/regard for preservation of texts and all that usual stuff. I am thrilled to see all these theories held over the fire so that the fat will drip off.

      Perhaps only one of these factors will hold up as being definitive. But what jumps out at present is the collision between these two approaches seems to have been quite magical.

      For those of us in the Anglosphere (plus the Dutch and some Scandis) who are descended physically and intellectually from a double distillation of Christianity and Nordic egalitarianism/nuclear family, we seem to have absolutely caught the best wave in recorded history. Even the slaves brought in unfairly and cruelly seem to have gotten enormous spillover benefit.

    4. ErisGuy Says:

      “It looks as if England/GB accelerated as soon as it no longer had to subsidise the North American colonies.”

      If you mean “subsidize” as no longer spend treasury to repress the free peoples of North America, and finally allowing them to prosper, then you’re correct. British rule in the USA (their rule continued in Canada—really now, identifying North America with 13 liberty-loving colonies isn’t accurate. Most North Americans have never wanted to be free of tyranny) wasted money twice over by repressing economic development in the colonies.

      Also, the British East India company effectively ruled India beginning in 1757. The vast wealth of spices and tea was at last Britain’s.

    5. dearieme Says:

      The 13 colonies were the lowest taxed civilisation in history. The British spent a fortune keeping the French from them. “Subsidised” is therefore a legit usage.

      Of course, there was a further effective subsidy on independence when many Americans reneged on their debts to British merchants.

      Another view would be that the British had by then invented the Industrial Revolution and that it was therefore masterfully bad timing for the Americans to cut themselves off from it, but that enters the world of counter-factual history which is largely fruitless. Anyway, the Americans proved perfectly adept at stealing foreign innovations so maybe it didn’t matter too much.

    6. Grurray Says:

      England bled way more profits out of the colonies by their mercanilist policies then they ever paid back.
      Exclusive resource extraction, foreign ships trading with colonies had to pass through British ports to pay duties, colonial shippers could only use British ships, colonial manufacturing was restricted for home use and certain goods could only be imported from Britain.

      The Seven Years War was a worldwide conflict and was fought amongst rivals jockeying for advantage in the European balance of power.
      If anybody was doing the subsidizing it was England’s colonial possessions.

      Only after we took down the First British Empire was England forced to turn to capitalism and local governance. It was then that the industrial revolution took hold. Getting knocked around by the Americans was the best thing that ever happened to England.

    7. RonaldF Says:

      Northern Europe benefited from the steel plow that allowed very rich soils to be tilled for the first time. Europe also benefited from the rediscovery of Roman Contract law and the scientific discoveries of Greek and Islamic scholars.
      The average Chinese person of knowledge could never hope to rise above his status – no matter how brilliant his discoveries. China also labored under a system where the world could not be quantified by modeling. The West and Christian beliefs put fourth the notion that God’s Universe was one of clock like precision, that could be broken down into smaller bits. It is an unbelievably fascinating story that all should benefit from.

    8. MikeK Says:

      RonaldF,

      Joel Mokyr’s books are a wonderful window into the middle ages and their economy. The moldboard plow is what allowed northern Europe to grow as the agricultural system of the Mediterranean was not adequate for the heavy soil of the north. He also explains windmills and other factors such as the use of animal protein that allowed women to survive the burden of menstruation which led to iron deficiency and excessive mortality.

    9. Grurray Says:

      Western civilization’s killer apps

    10. Death 6 Says:

      Thanks for the killer apps link. Most powerful and persuasive.

      Mike