Tag Archives: Europe

On the discrepancies between the original Maddison dataset and more recent GDP reconstructions

Angus Maddison was one of the most cited economists of the 20th century.

I often get emails asking me about Maddison’s figures, because I have worked a lot on historical national accounts reconstructions (see here, here, or here), and I was for 2 years faculty in the University of Groningen, where Maddison worked, and this is a justifiably renowned place for this type of work.

As an example, I copy here the relevant bits from an email that a friend and colleague recently wrote me. This colleague is asking about Portugal’s figures, but notice that a lot of what I will have to say can be generalized to other regions:

“The updated Maddison dataset has Portuguese GDP per person at 985 in 1530 (I assume in 1990 dollars).  1239 in 1600.  1192 in 1700, 1614 in 1750, 1330 in 1800 and 1225 in 1850.

The original Maddison dataset has Portuese GDP per person as 425 in 1000, 606 in 1500, 740 in 1600, 819 in 1700, and 923 for 1820.

Do you have any insight into these discrepancies?”

I do. In short, for this and many other cases, Maddison’s figures are simply made up. Read more below.

(Also, do notice that the modern Maddison project database is using 2011 prices, not 1990 ones, so for instance Jaime Reis’ and my own figures for Portugal, 1527-1850, are presented in 1990 prices in our paper, but the Maddison project pushed this into 2011 prices, so the levels may look different but they are not; the underlying real indexes are the same; our figures are the ones included in the Maddison project.)

picture_Maddison

Nothing I say here means to disparage Angus Maddison. He was a pioneer in these things (especially in so far as putting together in one place many estimates which in fact were often produced by many people – this had a lot of merit, though he’d very frequently get the citations that truly belonged to those who did the original work, but that’s is another story). He did stimulate many of us to continue these lines of inquiry, and do a better job. He was great.

But do notice that in one of the first posts in this blog, I did write,

“Despite the importance that Maddison’s GDP and population figures had in stimulating our thinking about economic history and development, it is fair to say that his pre-1820 figures were less than solid.”

The best way to think about Maddison’s estimates, especially for the period before 1820, is: when estimates did not exist (and they usually did not), he’d make very strong assumptions.

If you are an economist working on long-run growth you need to be wary of these assumptions. For China, real income per capita was stuck at exactly $600 “international” 1990 GK dollars between 1300 and 1850, according to Maddison in his late “Chinese Economic Performance in the Long Run” book (p. 157). Does this show that China was Malthusian? no, because Maddison effectively assumed China was Malthusian, and this is why he chose these numbers. I once saw an economist present at a conference and looking frankly ridiculous by claiming he had found that China was Malthusian for most of its history by using Maddison’s numbers. And, by the way, we now know that Maddison was not quite right, as you can read here.

Part of the problem is that Maddison often presents Tables in a way that makes it difficult to trace the original sources (this, I dare say, often made scholars un-aware that those were not his actual estimates, but those of others, which let to the citations problem I mentioned above).

How did he get to those figures? If you look into Volume 2 of his “World Economy” books, which is where most figures are put in Tables together and hence where typically people look first, or if you look online, in this original page, there are none listed. The historical statistics excel file avaliable even says “Copyright Angus Maddison” once you open it…

If you dig deep in his book, however, you do find some info. For population, continuing with the Portugal example, you find in Volume 1, p. 230 that “Population of 13 small West European countries assumed to move parallel to the total for the 12 countries above“. The latter were bigger countries, but the source of most of those is given as Maddison (1991), so you’d have to keep tracking other references to see how even those were actually done. Once you find the answer you will see that the evidence is rather thin. Needless to say, modern reconstructions are much more careful than this.

As for GDP per capita, in Volume 1, p. 249 he writes:

“I assumed a growth rate of Spanish GDP per capita of 0.25 per cent a year from 1500-1600, no advance in the seventeenth century, and some mild progress from 1700 to 1820. I adopted a similar profile for Portugal”.

That’s it. He simply assumed the numbers — vaguely citing only the following as inspiration, though not using it directly and citing with the following caveats (notice his own choice of words): “Yun’s (1994) rough per capita GDP estimates for Castile (about three-quarters of Spain) … his indicators for secondary and tertiary activity are weak“.

So, Maddison’s Portugal GDP per capita numbers are hence simply assumed to behave similarly to those of Spain, which are simply assumed by himself.

By contrast with this, here are the primary, archival sources that Jaime Reis and I use in our recent reconstruction of Portuguese per capita GDP, 1527-1850, which is forthcoming in the June edition of the Journal of Economic History. I list these here as an example, so you can see how much more exhaustive modern work is that what Maddison did. You can see a picture of what these account books look like if you click in our appendix, here.

I hope this discussion has been sufficiently clear on the origins of the differences between modern estimates vis-a-vis those of Maddison. It should be by now clear why they are considerably different at times. And furthermore – if you read our article, you will see that Portugal does not behave like Spain at all…

Primary Sources

We have collected both prices and wages from account (receipts and expenditures) books of the institutions listed below. Almost all were purchasers both of commodities and labor services. Some of them were also sellers of certain commodities produced by them. The account books of these institutions always display: the date of the transaction, the gross and unit value of the commodity, the unit of measurement employed, the quality of the product (e.g., coarse or fine paper, mutton, pork, or beef), and particular features of the transaction.

In order to proxy missing values we sometimes used a similar product or labor type (e.g., tallow candles for wax candles or carpenters for masons, both being skilled workers) by adjusting its price using a price ratio with the original product at a nearby year. Furthermore, to complete our Linen series for Lisbon during 1766–1829, we relied on Madureira (1997), listed in the secondary sources section.

Lisbon and Its Hinterland

Casa da Congregação do Oratório, Casa da Saúde, Lº 1º Receita e Despesa (Arquivo Municipal de Lisboa)

Casa dos Contos: Archive of the Court of Auditors

Convent of Nossa Senhora da Luz: National Archive

Convent of Santa Marta de Jesus: National Archive

Convent of Santo Alberto: National Archive

Convent of São Domingos de Lisboa: National Archive

Convent of Carmo, Expenses of the Sacristy: National Archive

Hospital of S. José: National Archive

Hospital of All Saints: National Archive

Holy House of Mercy of Almada: Archive of the Holy House of Mercy of Almada

Holy House of Mercy of Lisbon: Archive of the Holy House of Mercy of Lisbon

Holy House of Mercy of Lisbon, Shelter: Archive of the Holy House of Mercy of Lisbon

Holy House of Mercy of Lisbon, Foundlings: Archive of the Holy House of Mercy of Lisbon

Monastery of Chelas: National Archive

Monastery of S. Dinis de Odivelas: National Archive

Convent of Santo António da Convalescença: National Archive

Fabric of the See of Lisboa: National Archive

Seminary of Santa Catarina: National Archive

Administration of the Royal Household, Kitchens: National Archive

Porto and Its Hinterland

For Porto, we rely on Godinho (1955) as a secondary source plus the following primary sources:

Casa Pia Orphanage (administration): Porto District Archive

The See of Porto (revenues and expenditure): Porto District Archive

Colégio dos Órfãos, Daily Expenditure: Porto Municipal Archive

Porto Holy House of Mercy, Jailhouse Expenditure: Archive of the Santa Casa da Misericórdia do Porto

Porto Holy House of Mercy, General Hospital: Archive of the Santa Casa da Misericórdia do Porto

Porto Holy House of Mercy, Interments: Archive of the Santa Casa da Misericórdia do Porto

Porto Holy House of Mercy, Hospice for the Homeless: Archive of the Santa Casa da Misericórdia do Porto

Porto Holy House of Mercy, D. Lopo Hospital: Archive of the Santa Casa da Misericórdia do Porto

Porto Holy House of Mercy, Foundling Home: Archive of the Santa Casa da Misericórdia do Porto

Municipality of Porto, Palace of the Municipality: Porto Municipal Archive Municipal Abattoir, Porto Municipality: Porto Municipal Archive

Coimbra and Its Hinterland

University of Coimbra, Refectory: Archive of the University of Coimbra

Hospital of the University, Accounts and Administration: Archive of the University of Coimbra

Hospital of Nossa Senhora da Conceição, Accounts: Archive of the University of Coimbra

College of São Pedro, Kitchen: Archive of the University of Coimbra

Colégio de São Pedro, Book of purchases: Archive of the University of Coimbra

Expenditure on the Churches of the Reverend Chapter of the See of Coimbra: Archive of the University of Coimbra

Chapel of S. João da Sé, Revenue and Expenditure: Archive of the University of Coimbra

Chapter of the See, register of expenditures: Archive of the University of Coimbra

Fabric of the College of São Pedro, Register of Expenses: Archive of the University of Coimbra

Municipal Council of Coimbra, Revenue and Expenditure: Archive of Coimbra

Municipality Works of the Church of the See of Coimbra, Expenses: Archive of the University of Coimbra

University of Coimbra, Receipts and Expenditure: Archive of the University of Coimbra

Hospital of São Lázaro, Receipts and Expenditure: Archive of the University of Coimbra

Holy House of Mercy of Coimbra, Income and Expenditure: Archive of the Holy House of Mercy of Coimbra

Episcopal Mitre of Coimbra, Expenses: Archive of the University of Coimbra

Register of the Granary of the Chapter of Coimbra: Archive of the University of Coimbra

Royal Hospital of Coimbra, Registers of Expenditure: Archive of the University of Coimbra

Évora and Its Hinterland

For Évora, we rely on Santos (2003) and Godinho (nd) secondary sources plus the following primary sources:

Royal Public Granary of Évora, Accounts: Archive of the District of Évora

Évora Aqueduct, Accounts of the Repairs and Maintenance: Archive of the District of Évora Repairs of Évora City Streets ,Wages and other Expenditure: Archive of the District of Évora

Casa Pia Orphanage, Revenues and Expenditures: Archive of the District of Évora

Casa Pia, Hospice of Nossa Senhora da Piedade, Accounts: Archive of the District of Évora

Holy House of Mercy, Books and Accounts: Archive of the District of Évora

Convent of Paraiso, Accounts: Archive of the District of Évora

Convent of the Saviour, Accounts: Archive of the District of Évora

College of Nossa Senhora da Purificação: Archive of the District of Évora

Secondary Sources

Costa, Leonor, and Jaime Reis. “The Chronic Food Deficit of Early Modern Portugal: Curse or Myth?” Análise Social LII (2017): 416–29.

Godinho, Vitorino Magalhães. Introdução à história económica. Lisboa: Livros Horizonte, n.d.

———. Prix et monnaies au Portugal 1750–1850. Paris: Librairie Armand Colin, 1955.

Madureira, Nuno. Mercados e Privilégios. A Indústria Portuguesa entre 1750 e 1834. Lisboa: Estampa, 1997.

Santos, Rui. Sociogénese do Latifundismo Moderno: Mercados, Crises e Mudança Social na Região de Évora, Séculos XVII a XIX. Lisboa: Banco de Portugal, 2003.

 

addendum: I originally wrote in this post, a few hours ago, that the Maddison project now corrects for inflation by expressing variables in 2015 dollars, but this should be 2011. I heard they were thinking of changing to 2015 in the next version.

Money and Modernization in Early Modern England (forthcoming at the Financial History Review)

In early modern England, coin supply increased a lot without prices responding proportionally:

QTM.png

This contradicts the Quantity Theory of Money, according to which the changes should move together. If the money supply doubles, prices should double too, because the quantity theory assumes income and velocity to be constant (at least in the long run).

Here I show just coin supply, so a very narrow measure of the money supply. Broader money supply must have increased even more, as forms of paper money and credit developed at this time. This makes things look even worse for the quantity theory.

While the Quantity Theory looks bad, there is no contradiction with the equation of exchange, which simply states that nominal GDP equals velocity times money. Nor could there be, as the equation of exchange just an accounting identity.

In my forthcoming Financial History Review paper, “Money and Modernization in Early Modern England”, I explain what was going on. I argue that monetization helped support economic growth and structural change. If real growth happens, money can increase without a response of prices.

If you are interested, you can read the paper here.

Call for papers: Revista de Historia Económica-Journal of Iberian and Latin American Economic History, Special Issue on Portuguese Economic and Social History

Revista de Historia Económica-Journal of Iberian and Latin American Economic History Fast Track Meeting: Special Issue on Portuguese Economic and Social History17 November, 2018, Lisbon

Submissions are welcome for a Fast Track session to be held during the 2018 APHES meeting in Lisbon. All papers must be submitted in English and cover some aspect of Portuguese economic history, including the former colonies (prior to independence; e.g. a paper can be about Brazil, but only prior to 1821). Comparative papers are welcome.

Anyone is free to submit, but submissions from young scholars are particularly welcome. Revista de Historia Económica-Journal of Iberian and Latin American Economic History will publish a special issue on Portuguese economic and social history based on some of the papers presented in this fast track sessionThe scientific commitee will then send the best papers to be refereed but a decision will be taken within without a long delay and articles will appear in print within a relatively short time.  

The scientific committee will be composed of Blanca Sánchez Alonso (Universidad San Pablo-CEU Spain and RHE-JILAEH chief editor), Nuno Palma (University of Manchester, UK) and Jaime Reis (ICS, University of Lisbon). 

Nuno Palma (University of Manchester, UK) will serve as the guest editor for the special issue. 

Those interested should submit their papers to RHE-JILAEH via the manuscript central system no later than 15th October 2018 https://www.cambridge.org/core/journals/revista-de-historia-economica-journal-of-iberian-and-latin-american-economic-history. When submitting through manuscript central, please mention in the cover letter that you would like your paper to be considered for Fast Track. The most promising papers will be selected for the Fast Track Meeting. Authors will be informed whether their paper will be selected to present by November 1, 2018.

Best Regards,

Blanca Sánchez Alonso (Universidad San Pablo-CEU, Spain and RHE-JILAEH chief editor)

Image result for revista de historia económica

Why did premodern Poland fail? (Highlight II)

Mikołaj Malinowski (Lund) is a quantitative economic historian. His expertise is in quantitative analyses of the role of markets and institutions in long-term economic growth of Eastern Europe. He has already constructed long-term series of real wages, GDP, and market conditions in Poland between the late middle ages and the early 19th century. This investigation revealed that the Polish economy expanded in the late middle ages and the 16th century but then contracted in the 17th and 18th centuries.

Further, Malinowski put forth the hypothesis that the economic contraction might have been a result of market segmentation. Building on a large body of price data, he showed that market conditions in Poland were improving in the 16th century but then declined in the 17th and 18th centuries. He proposed that the market crisis affected Polish economic development via two channels. First, the market segmentation led to an increase in the Malthusian pressure and, subsequently, to the decline in real wages. Second, he demonstrated that the adverse market conditions reinforced serfdom, which in the short term made the urban sector more resilient to the adverse conditions, but in the long term consigned the region to backwardness.

Malinowski.png

This research has been published in top peer-reviewed journals in Economic history. His article ‘Serfs and the city: market conditions, surplus extraction institutions, and urban growth in early modern Poland’ has been awarded the Figuerola Prize for the best article published in the European Review of Economic History.

Currently, Malinowski researches the impact of political centralization and legal state capacity on economic development. States can either stimulate or inhibit economic performance. Proponents of the free-market see the coercive nature of states as a factor contributing to economic stagnation. New Institutional Economics argues for constraining governments to avoid harmful predation. However, states can also provide the institutional framework necessary for sustained economic growth. Malinowski analyses the role the parliament played in developing a domestic commodity market in the First Republic of Poland. His results indicate that legal state capacity was positively associated with domestic market integration. Conversely, anarchy, understood as executory, judiciary, and regulatory inaction of the central government was associated with a rise in the exchange costs.

Malinowski is also one of the founders of WEast: The Eastern European Economic History Initiative. He has developed a well-established series of periodic workshops in economic and social history that has received financial support of the European Society of Historical Economics. Information about WEast can be found on weast.info.

KEY RESEARCH:

Income and its distribution in preindustrial Poland. Cliometrica 11(3), 2017 (With Jan Luiten van Zanden)

Serfs and the city: market conditions, surplus extraction institutions and urban growth in Poland, 1500-1772. European Review of Economic History 20(2), 2016: 123-146

Little Divergence revisited: Polish living standards in a European perspective, 1500-1800. European Review of Economic History 20(3), 2016: 345-367

Market conditions in preindustrial Poland, 1500-1772. Economic History of Developing Regions 31(2), 2016

Economic consequences of anarchy; Legal state capacity and market integration in early modern Poland, mimeo.

Ridolfi on premodern France (Hightlight I)

As announced in the previous post, there will be from now on once in a while posts written by guest scholars, both junior a senior. This post has been written by Leonardo Ridolfi of the IMT School for Advanced Studies, Lucca. You can find Leonardo’s most recent working paper here.

France_anciennes_provinces_1789

The French economy in the longue durée. A study on real wages, working days and economic performance from Louis IX to the Revolution (1250-1789)

This work addresses a gap in the literature concerning living standards in pre-industrial France.

While traditionally research had an eminently localized character, focusing on the experience of specific regions or what might be called “local economics,” still to date, there is no consolidated understanding of the long-term development of wages and prices from a broader national perspective.

Building and improving upon the precious contributions offered by the many compilers of wage and price data in France, this study is an attempt to provide a solid empirical characterization of the principal macro-economic aggregates of pre-industrial France and trace the main contours of economic growth in the country from the phase of early state formation to the Revolution.

Delving into the vast set of secondary and printed primary sources, the first section presents new series of real wages for male agricultural and construction workers in France from 1250 to 1789 (now updated to 1860) following Allen (2001)’s barebones basket methodology.

The analysis highlighted three main issues.

First, our series offer little support to the argument that there were appreciable long run improvements in living standards for French wage earners before the Industrial Revolution. Indeed, real wages displayed no substantial trend improvement between the thirteenth and the mid-nineteenth century.

Second, the estimates reveal that the period 1350-1550 saw the rise and consolidation of a real wage gap between France and England as well as other leading European cities. Still in the decade prior to the Black Death the real wage differential between French and English workers of the construction sector was remarkably low. A century later, in the 1450s, French building labourers had between about 25 and 40 percent less of the income of their European counterparts.

Comparing real wages of French farmers to those of their English counterparts I found a similar pattern and few traces of a French “golden age” of labour. Indeed, after a first phase of rapid expansion following the Black Death, by the1370s real wages grew less and for a shorter period than elsewhere in Europe where the welfare gains consolidated almost until up the 1450s. At a more disaggregated level, similar trends are discernible by comparing Paris to London.

As a first step, I decomposed the proximate causes of this gap between prices and wages. I found that France and England witnessed similar deflationary trends between the 1370s and the 1450s. Yet, it was the decline of French silver wages (apparently driven by falling production and reduced labour demand especially during the worst phases of the Hundred Years War) and the contemporaneous increase of English salaries, that explain the “dampened” Malthusian cycle of real wages in France as opposed to the “full” Malthusian cycle experienced by England and Central-Northern Italy.

FIG1

Figure 1: Real wages

Notes and Sources:  French labourers: this study (updated version of the thesis). England: Clark (2005).

Finally, even if demographic data before the 1550s are fragmentary, it is possible to argue, consistently with the Malthusian interpretation, that the dynamics between real wages and population was characterized by a long-lasting inverse relationship. Nevertheless, while this mechanism appears to hold in general, at least by the mid-seventeenth century one can detect a weakening of the inverse relationship. Indeed, the long phase of demographic expansion that brought population almost to triple between the 1600s and the mid-nineteenth century, was paralleled by a mild decrease or a substantial stagnation of real wages.

The second section provides a broad characterization of working time in pre-industrial Europe concentrating on three dimensions of time: the calendar working year corresponding to the calendar year net of general holidays and religious festivities; the actual working year and the implied working year defined as the annual number of days of work required by a male breadwinner to provide for a notional family of five components (Allen and Weisdorf 2011).

Due to the dearth of compelling evidence on work intensity for workers employed in agriculture, I looked at the experience of construction workers on site providing new estimates of trends in calendar, actual and implied working year in France and England from the fourteenth to the eighteenth century.

By analyzing the joint evolution of these three dimensions of time and comparing the patterns of change of time-use, and their response to variations in the institutional and market conditions, I identified two distinct regimes of industriousness featuring France and England in the pre-industrial era.

In France, the annual number of days required by a male breadwinner to provide for his family (the implied working year) was greater than the actual number of days worked per year, meaning that women and children’s labour force participation as well as the presence of additional sources of non-labor income were necessary to assure the basic levels of consumption. This implies that expansions in the offer of labour were primarily driven by raising inflation and economic hardship (Figure 2).

FIG2

Figure 2: The French case

Sources: Calendar, actual and implied working year: this study.

Notes: Surplus (deficit) labour input: The positive (negative) difference between actual and implied working year (shaded area).

By contrast, I found evidence of the existence of two phases where English regular construction workers supplied more days of work to the market than required by basic household subsistence (Figure 3).

The first episode occurred between 1400 and 1500, while the second corresponds to the industrious revolution originally described by De Vries (2008).

Several hypotheses are discussed to shed light on the origin of these phases of surplus labour input and their implications on the structure of consumption and production. These episodes differed in two fundamental ways.

First, they originated from different dynamics.

Indeed, the episode of surplus labour input located by De Vries in the seventeenth century England and the Low Countries, derived from an upsurge in actual workloads and a contemporary drop of work requirements necessary for family subsistence in a context of progressive expansion of the frontier of working possibilities.

On the contrary, the episode of surplus labour input detected in the post-plague period was characterized by the contemporary reduction of actual, calendar and implied working year.

Received wisdom would suggest that workers should have totally (or in large part) compensated the post-plague increases in real wage rates by reducing labour supply of approximately the same amount consuming a considerable proportion of their augmented purchasing power in the form of leisure (Blanchard 1994). However, actual workloads decreased much less than implied by the contemporary increase in real wage rates. This incomplete adjustment, that reflected a rather inelastic labour supply of construction workers, could depend on two main factors.

First, the existence of technical requirements and institutional settings, including the rhythm of the construction process, the rests dictated by calendar working year as well as the recruiting schemes of contractors and the organizational forms of entrepreneurs, limited voluntary reductions of actual workloads.

Second, the incomplete response of actual workloads could reflect the rise of a new attitude toward higher quality consumption from an increasing share of workers (seemingly skilled and urban) that was “aping the lesser gentry” (Dyer 1988).

In this respect, these episodes had different implications for the relationship between labour offer, consumption and production.

Indeed, the phase of surplus labour input in the seventeenth century England was seemingly related to a consumer revolution (Allen and Weisdorf 2011) and could be thought of as a transition from traditional consumption cluster to a broader and more modern one that included colonial products and luxuries (De Vries 2008).

The episode of surplus labour input in the late medieval England was not marked by more and new items entering the basket but seemingly ran in parallel with a relocation of consumption choices within the horizon of traditional consumption that reflected structural changes in the economy after the Black Death and the aspiration of a growing share of population for higher alimentary standards less dependent upon cereal-based and lower quality foodstuff (Dyer 1988).

From the production side, while the seventeenth century phase of surplus labour input saw the rise and consolidation of new sectors outside agriculture, the first episode (seemingly did not cause but) coincided in time with a shift of agriculture from arable to pasture. This process is consistent with a large body of empirical evidence documenting changes in alimentary regimes during the fourteenth and fifteenth centuries.

FIG3

Figure 3: The English case

Sources: Calendar year: this study. Implied working year: Allen and Weisdorf (2011). Actual working year: Period 1300-1559: this study. Between 1560 and 1732, Clark and Van DerWerf (1998) and by 1750 Voth (2001) as reported in Table 2 of Allen and Weisdorf (2011).

Notes: Surplus (deficit) labour input: The positive (negative) difference between actual and implied working year (shaded area).

Finally, in the last section I present new estimates of agricultural and total output per capita in France between 1280 and 1789 using the demand side approach. The study suggests that GDP per capita displayed no substantial trend improvement over this period. At the death of King Philip the Fair in 1314, France was a leading economy in Europe and output per capita averaged 900 dollars per year. Almost five centuries later, at the beginning of the 18th century, this threshold was largely unchanged and GDP per capita was slightly above 1000 dollars, about half of the level registered in England and the Low Countries (Figure 4).

These estimates document quantitatively and in the aggregate what was previously known only qualitatively or for some regions by the classic works of the French historiography (Goubert 1960; Le Roy Ladurie 1966) thus offering support to Le Roy Ladurie (1977)’s characterization of the pre-industrial French economy as a stagnating, growthless system.

Nevertheless, GDP per capita was highly volatile and experienced multiple peaks and troughs alternating phases of economic crisis to periods of economic expansion. These include the “efflorescence” of economic growth that took place between the 1280s and the 1370s and the growth trend since the mid-16th century that ran in parallel with the consolidation of the French state and the opening of new trade routes from Europe to Asia and the Americas.

Overall, our estimates suggest that the evolution of GDP per capita in France can be suitably interpreted as an intermediate case between the successful example of England and the Low Countries and the declining patterns of Central-Northern Italy and Spain. Being neither a southern country nor a northern one, the growth experience of France seems to reflect this geographic heterogeneity.

FIG4

Figure 4: GDP per capita in Europe

Sources: England: Broadberry et al. (2011); France: this study; Holland: van Zanden and van Leeuwen (2012); Italy: Malanima (2011); Portugal: Palma and Reis (2016); Spain: Álvarez-Nogal and Prados de la Escosura (2013); Sweden: Schön and Krantz (2012).

References

Allen, Robert C. “The great divergence in European wages and prices from the Middle Ages to the First World War.” Explorations in economic history 38, no. 4 (2001): 411-447.

Allen, Robert C., and Jacob Louis Weisdorf. “Was there an ‘industrious revolution’ before the industrial revolution? An empirical exercise for England, c. 1300-1830.” The Economic History Review 64, no. 3 (2011): 715-729.

Álvarez‐Nogal, Carlos, and Leandro Prados de la Escosura. “The rise and fall of Spain (1270-1850).” The Economic History Review 66, no. 1 (2013): 1-37.

Blanchard, Ian. Labour and Leisure in Historical Perspective, Thirteenth to Twentieth Centuries: Papers Presented at Session B-3a of the Eleventh International Economic History Congress, Milan, 12th-17th September, 1994. No. 116. F. Steiner, 1994.

Broadberry, Stephen et al. “British Economic Growth, 1270-1870: An Output-Based Approach”, London School of Economics, 2011. http://www2.lse.ac.uk/economicHistory/whosWho/profiles/sbroadberry.aspx.

Clark, Gregory, and Ysbrand Van Der Werf. “Work in progress? The industrious revolution.” The Journal of Economic History 58, no. 3 (1998): 830-843.

Clark, Gregory. “The condition of the working class in England, 1209–2004.” Journal of Political Economy 113, no. 6 (2005): 1307-1340.

De Vries, Jan. The industrious revolution: consumer behavior and the household economy, 1650 to the present. Cambridge: Cambridge University Press, 2008.

Dyer, Christopher. “Changes in diet in the late middle ages: the case of harvest workers.” The Agricultural History Review (1988): 21-37.

Goubert, Pierre. Beauvais et le Beauvaisis de 1600 à 1730: contribution à l’histoire sociale de la France du XVIIe siècle: atlas (cartes et graphiques). Paris: SEVPEN, 1960.

Le Roy Ladurie, Emmanuel. Les paysans de Languedoc. 2 vols. Paris: SEVPEN, 1966.

Le Roy Ladurie, Emmanuel. “Motionless history.” Social Science History 1, no. 2 (1977): 115-136.

Malanima, Paolo. “The long decline of a leading economy: GDP in central and northern Italy, 1300-1913.” European Review of Economic History 15, no. 2 (2011): 169-219.

Palma, Nuno and Reis, Jaime. “From Convergence to Divergence: Portuguese Demography and Economic Growth, 1500-1850” (September 13, 2016). Available at SSRN: https://ssrn.com/abstract=2839971 or http://dx.doi.org/10.2139/ssrn.2839971

Schön, Lennart, and Olle Krantz. “The Swedish economy in the early modern period: constructing historical national accounts.” European Review of Economic History 16, no. 4 (2012): 529-549.

Van Zanden, Jan Luiten, and Bas Van Leeuwen. “Persistent but not consistent: The growth of national income in Holland 1347-1807.” Explorations in economic history 49, no. 2 (2012): 119-130.

Voth, Hans-Joachim. “The longest years: new estimates of labor input in England, 1760-1830.” The Journal of Economic History 61, no. 4 (2001): 1065-1082.

 

 

Introducing “highlights”: Ridolfi on premodern France and Jongman on the Roman empire

From now on there will be once in a while posts written by others in this blog. These will be written both by young scholars and by more senior, established scholars.

The idea is that these scholars will write short essays about the main conclusions (and possibly policy implications) from their overall work. Scholars will write about their work overall: the forest, not the trees. Speculation about future work and general considerations about the state of the field are welcome. Hence the logic is different (and a complement, not a substitute) from that of blogs such as EHES’s Positive Check or EHS’s The Long Run, where people write about one specific paper at the time.

Consistent with this policy, the two inaugural posts will be written by:

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How important was colonial trade for the rise of Europe?

I recently gave an interview to Garret M. Petersen of the Economics Detective Radio where we discuss some of my work. You can listen to it in this link: Money, Trade and Economic Growth in the Early Modern Period (interview).

In the interview, we discuss at one point the matter of how important was colonial (and otherwise intercontinental) trade for macroeconomic outcomes such as growth and urbanization in Europe. As I notice in the interview, my position on this (see my Cliometrica article for details) stands between two extremes:

  1. that of Eric Hobsbawm or Immanuel Wallerstein, who argue Europeans profited a huge deal from the colonies. This view is very prevalent in some political circles today, if not the person on the street, who often believes that “imperialism” or “colonialism” is what what made the West Rich, through exploitation of the rest of the world. It is related to “dependency theory”.
  2. by contrast, that of many if not most economic historians, who believe that such trade (and the violence that came with it) didn’t matter very much for outcomes back in Europe.

The latter view became the orthodoxy among economists and economic historians after Patrick O’Brien’s 1982 paper, which in one of many of Patrick’s celebrated phrases, claims that “”the periphery vs peripheral” for Europe. He concludes the paper by writing:

“[G]rowth, stagnation, and decay everywhere in Western Europe can be explained mainly by reference to endogenous forces. … for the economic growth of the core, the periphery was peripheral.”

This is the view that remarkable scholars such as N. Crafts, Deirdre McCloskey, or Joel Mokyr repeat today (though Crafts would argue cotton imports would have mattered in a late stage, and my reading of Mokyr is that he has softened his earlier view from the 1980s a little, specifically in the book The Enlightened Economy.) Even recently, Brad deLong has classifyied O’Brien’s 1982 position as “air tight”.

Among economists and economic historians more on the economics side, I would say that O’Brien’s paper was only one of two strong hits against the “Worlds-System” and related schools of thoughts of the 1970s, the other hit being Solow’s earlier conclusion that TFP growth (usually interpreted as technology, though there’s more to it than that) has accounted for economic growth a great deal more than capital accumulation, which is what Hobsbawm and Wallerstein, in their neo-Marxist framework, emphasize.

Let me be clear from the outset that the idea that it was European exploitation of foreign peoples that made it rich is, by itself, highly simplistic, and, in short, nonsense. The view held by many historians and members of the public, that colonialism essentially equals why the west is rich is evidently false. This view is seductive in part because of the nasty violent means and institutions (such as slavery), clearly immoral from the normative standpoint of our times, which was often associated with it. Even if partially true it fails to ask why was Europe the part of the world capable of doing this, which in turn raises the obvious suspicion that the deep causal factor lies elsewhere.

To a degree in the interview I react more against the opposite version, the point (2) above, the idea that it did not matter at all. But this is because I hold the fact that (1) is false as more evident.

One irony with all of this is that for more than a decade now, Patrick O’Brien has changed his mind. He has, indeed refereed to this in writing (as far back as 2006), and several people have witnessed seminars where the speaker mentions “as Patrick O’Brien has concluded, colonies didn’t matter for European development…” only to have Patrick raise and kindly but firmly inform the speaker of his change of heart.

Last year at the American Economic Association meeting in S. Francisco, my good friend Deirdre McCloskey even told me in disappointment how me she feels Patrick should go back to his old view! But I feel there’s good reason for his change of mind. Patrick certainly hasn’t adopted a Hobsbawm-Wallerstein type of position. He is now simply of the view that, at the margin, trade with other parts of the world did matter for European development. It’s does not explain everything, but it mattered a bit. This is what I find empirical support for in my own work.

My discussion has focused on the impact of trade for the European economy.  As Brad deLong notices, a different matter is that of whether such trade had an impact on other parts of the world (positive or negative). Patrick O’Brien sometimes refers to himself as a “mercantilist”. So I conclude by noting that some ideas related to the benefits of protectionism (once an idea almost banished from the realms of “serious” economics), especially as it applies to countries that are not at the frontier, has been taking hold among some young and very competent economic historians, such as Réka Juhász or Luigi Pascali. Perhaps I’ll write more about this in a future post.

 

 

nbm