These include the growth of the labour force, increased labour effort, more cultivated land, investment in both human capital and physical capital, the growth of total factor productivity (TFP) and structural change. Drawing on Maddison’s (1988) distinction between proximate and ultimate sources of growth, the first step is to assess the contributions of the proximate factors. On this basis, it is clear that a significant gap opened up between the leading regions of Europe and Asia only after 1700.Īs well as quantifying the timing of the Great Divergence in terms of GDP per capita comparisons, I also offer an account of the Great Divergence, in the sense of explanation.
#STEVE.PNG FOLDER FORGE SERIES#
The China leader series is for the Yangzi delta, while the Europe leader series is based on Italy until 1540, followed by the Netherlands until 1800 and then Great Britain. 2015).įigure 1 GDP per capita in Europe and Asia, 1000-1870 (1990 international dollars)įigure 2 charts the level of GDP per capita in the leading Chinese and European regions. Japan forged ahead of China during the 18th century, but continued to grow more slowly than Britain, which emerged as the leading Eurasian nation of the 19th century (Bassino et al. Second, there was an Asian Little Divergence as Japan overtook China. Starting out from a lower level of GDP per capita, both Britain and the Netherlands received a permanent boost to per capita incomes after the Black Death of the mid-14th century, and the Netherlands forged ahead of Italy in the 16th century during its Golden Age, while Britain overtook Italy in the early 18th century and the Netherlands at the beginning of the 19th century. First, there was a European Little Divergence, as Britain and the Netherlands overtook Italy. The new estimates of GDP per capita for three leading nations in Europe and two in Asia are graphed in Figure 1, and point to substantial regional variation in both continents. However, this is obviously a lot later than suggested in the traditional view, where Europe was seen as forging ahead since the medieval period. New historical national accounting data suggest that the Great Divergence dates from the 18th rather than the 19th century, a view that has recently been endorsed by Pomeranz (2011, 2017). In a new paper (Broadberry, 2021) I argue that the revisionist authors of the California School were right to point to regional variation in economic performance in both Europe and Asia, but went too far in claiming parity of economic performance between the two continents until the 19th century. The word “accounting” is used here in two ways, embracing both measurement and explanation. Whilst this was understandable given the past focus of quantitative economic history on the modern period, and particularly the period since the mid-19th century, the new century has seen much progress in the extension of the quantitative approach both back in time and across space to cover Asia as well as Europe, and this paper draws on this work to provide an account of the Great Divergence. However, despite the fundamentally quantitative nature of the revisionist claims being made, this work was not generally based on systematic analysis of data. Other parts of Asia were also characterised as equally developed at the end of the 18th century. Pomeranz (2000) questioned what he saw as the Eurocentric bias of this account, claiming that as late as 1800, the Yangzi Delta region of China was as developed as Britain and the Netherlands, the richest parts of Europe. The Industrial Revolution and 19th century colonialism were seen as accelerating this process of divergence, rather than regarded as its fundamental causes. As Europe transformed its institutions and accumulated capital, Asia stagnated and began to fall behind. For much of the 20th century, economic historians treated the Industrial Revolution as the culmination of a process of gradual improvement, beginning in the Late Middle Ages and continuing through the early modern period (Weber 1930, Landes 1969). The debate over the Great Divergence in productivity and living standards between Europe and Asia has had a remarkable impact on our understanding of the sources of western prosperity.
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