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The Oxford Very Short Introductions Series

Global Economic History: A Very Short Introduction

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Why are some countries rich and others poor? In 1500, global income differences were small, but disparities have grown dramatically since Columbus reached America. In this Very Short Introduction, Robert C. Allen shows how the interplay of geography, globalization, technological change, and economic policy has determined the wealth and poverty of nations. Allen shows how the industrial revolution was Britain's path-breaking response to the challenge of globalization. Western Europe and North America joined Britain to form a club of rich nations, pursuing four polices--creating a national market by abolishing internal tariffs and investing in transportation, erecting an external tariff to protect their fledgling industries from British competition, creating banks to stabilize the currency and mobilize domestic savings for investment, and promoting mass education to prepare people for industrial work. Together these countries pioneered new technologies that have made them ever richer. A few countries--Japan, Soviet Russia, South Korea, Taiwan, and perhaps China--have caught up with the West through creative responses to the technological challenge and with Big Push industrialization that has achieved rapid growth through coordinated investment.

196 pages, Paperback

First published January 1, 2011

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Robert C. Allen

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Displaying 1 - 30 of 134 reviews
Profile Image for Amira Mahmoud.
618 reviews8,114 followers
November 24, 2018
كنت بحاول استوعب إيه الأفضلية المقارنة اللي الكاتب بيتكلم عنها دي لحد ما قدرت أخمن في النهاية إنه يقصد القانون الاقتصادي المعروف بالميزة النسبية، المترجم حتى معندوش أدنى معرفة اقتصادية تساعده يترجم صح ولا حتى فكر يدور في ترجمه ومعنى حاجة مشهورة ومهمة اقتصاديًا بالشكل ده!

بخلاف كدة الكتاب عظيم، ومهم جدًا، وبيطرح تفسيرات وإجابات غير معتادة عن السؤال اللي قُتل بحثًا وهو ليه في دول غنية ودول غيرها فقيرة
وأعتقد هحتاج اقراه مرة تانية، أو ارجع له في أجزاء مهمة على الأقل.
من أفضل قراءات 2018
Profile Image for Riku Sayuj.
653 reviews6,926 followers
March 5, 2018
I had been asked to read this in parallel with Jared Diamond’s Guns, Germs, and Steel: The Fates of Human Societies. Unfortunately, I have gotten around it more than a year late. But I kept the GGS open beside me as I traced the economic explanations for the trajectories of the various continents/regions - and it is true this book is a good companion volume for the enormously popular GGS. It can prove to be a useful aid to go beyond some of the simplistic assumptions and still arrive at some of the same conclusions. Which is a thrill, by the way.

A second reading, and an additional star to Allen's VSI. This really is a superbly concise summation of a lot of great ideas, well tied together and well presented.
Profile Image for Warwick.
809 reviews14.4k followers
September 18, 2018
Everybody knows the fight was fixed
The poor stay poor, the rich get rich
That's how it goes…Everybody knows.

      —Leonard Cohen

Economics is a frustrating subject, managing to be both essential and eye-wateringly dull. This primer does a decent job of distilling its subject into one basic question – why the world is so unequal – and of holding your attention long enough to sketch the outlines of an answer.

Normally with such things there is a lot of hemming and hawing, bet-hedging, and phrases like ‘remains to be seen’; here, refreshingly, Allen is relatively clear and unambiguous about how things came about (though less so on how they should be fixed). There is much discussion of economic policy, but plainly geographical luck had a lot to do with it – and once some economic development gets underway, it becomes a self-fuelling engine as technology substitutes for, and drives, higher wages.

This is why the technologies developed by the industrialised West can't just be imported into developing countries – they only make economic sense when workers are paid so much that investing in machines instead becomes an appealing prospect.

Western technology in the 21st century uses vast amounts of capital per worker. It only pays to substitute that much capital for labour when wages are high relative to capital costs.


And the technology brings with it newer, more specialised jobs, which in turn bring higher wages, which in turn prompts further R&D into technology that will make them obsolete…. Hence the Industrial Revolution – and other ‘industrial revolutions’ since – were the result, not just the cause, of high salaries, and countries who don't get started are stuck in a poverty trap.

Especially interesting is the discussion in the last chapter about those few countries that did manage to catch up with the West – namely Japan, South Korea, and in part the Soviet Union. China will undoubtedly join this group any second now. The only way this could be done was to construct all the elements of an advanced industrialised economy all at once – steel mills, car factories, cities, all erected as an act of will on the grounds that they would eventually all need each other. This is ‘big push’ industrialisation, but it is hardly an option for many countries, especially those still suffering the deleterious hangovers of colonialism.

You finish something like this with a lot of questions, but they are at least more specific than the questions you had going in – or that's the hope, anyway. At the very least there's enough in here to arm you against the next Jared Diamond fanatic you find yourself stuck in an elevator with.
Profile Image for Jonathan Peto.
252 reviews45 followers
January 2, 2013
This "very short introduction" was fine. One point it hammered home was that there is a historical connection between high wages and growth. That came up repeatedly. Another interesting idea for me was that without the Industrial Revolution, without growth, without, I guess, consumerism, a lot of us would work hard just to subsist. The book gave me a good impression of how various factors interact and why some nations have been more successful than others. Folks, education is much more important than the military. Likewise, giving the so called job creators too big a piece of the pie is good for them in the short term, but not good for long term prosperity. It's bad for everyone in the long term...
Profile Image for Ahmed Ibrahim.
1,196 reviews1,559 followers
July 21, 2020
يطرح الكتاب سؤالا هاما ويتناوله بالتحليل: لماذا تتمتع بعض دول العالم بالثراء الفواحش ويعاني البعض الآخر من الفقر المدقع؟
بشكل سريع غير مخل يقف الكاتب على تاريخ الاقتصاد العالمي وأسباب صعود الدول وغناها وفقر البعض الآخر، يمتد تحليل الكاتب من فترة تقع بين 1500:2006 ميلاديا.
كتاب جميل لإلقاء نظرة عامة على مسيرة دول العالم الاقتصادية.
Profile Image for David.
189 reviews18 followers
December 20, 2022
Very good. Dispassionate longue durée overview of the world's civilizations coupled with assessment of national economic policies. Most discussion goes towards the USSR, Japan and China; I'd have liked to see more on the African attempts at creating industrialized high-wage economies.

High wages and standards of living, in Allen's view, are not so much the result as the cause of economic take-off. Trade union activity captures but does not create high-wage potential. The Industrial Revolution is an umbrella term for a period of adaptation of capitalist enterprise to what was already a high wage environment. In this, Allen almost verbatim repeats Emmanuel's insistence on wage levels as the dynamic variable.
Profile Image for سارة العاصي.
140 reviews10 followers
August 29, 2015
مقدمة قصيرة عن التاريخ الاقتصادي العالمي لكن مفيدة و مثيرة للفكر، لماذا بعض الدول غنية و الأخرى فقيرة؟ لماذا نهضت أوروبا لا إفريقيا؟ أسئلة قديمة الإجابة عنها جولة في تاريخ العالم و تحليل لعوامل النمو الاقتصادي ما بين بريطانيا و فترات الاستعمار و قيام أمريكا و نموذج اليابان و روسيا و الفرق بين نموذج التنمية الاقتصادي القياسي و الدفعة القوية و عوامل النجاح و الفشل لنفس النموذج في دول مختلفة.
أكد الكتاب كثيرا على نقطة أن ارتفاع الأجور يجعل الدول تتجه للتكنولوجيا و بحث تخفيض العمالة فهنا تكون تكلفة رأس المال أقل من تكلفة العمالة و حتى إذا تكلفت الأبحاث أموال طائلة سيكون الأمر مربحا في النهاية و هذا ما حدث في الثورة الصناعية في بريطانيا و في زيادة التصنيع في أمريكا، و يمكن الاستنتاج من ذلك أن في الدول الفقيرة الأجور منخفضة و رأس المال و التكنولوجيا أعلى تكلفة و الأمر غير مربح و اسعار السلع منخفضة لأن العمالة رخيصة و لذلك لا تكفي لشراء آلات غالية الثمن لتحسين الإنتاج و هذه هي دائرة الفقر و التخلف التي تدور فيها الكثير من الدول.
و السلام
Profile Image for Rick Sam.
389 reviews88 followers
June 28, 2022
A detailed introduction work on Economic History.

I came to this work through, Angus Maddison on Economic History.

With curious question, "Why did India fall in socio-economic status?"

Once, India was leading nation socio-economically in the planet, So what happened?

There are two popular views:

a) Externalists
b) Internalists

1. What are these?

Externalist blame, completely, english people for India's socio-economic demise.

Internalists blame, social customs, superstition, religious belief within India for socio-economic demise.

As of now; I do not have a full picture.

Engage in a conversation with non-Westerners.
You'd be surprised to find many externalists.

Externalists are armed with an inflexible bow and arrow of flaming words.

Words such as steal, thieves, took away wealth comes fast from this bow and arrow.

They strike our opponent, hitting bulls-eye.

Famous example of externalist view -- Shashi Tharoor.

Tharoor, who struck gold in Politics and at England with externalist view.

2. So, What else?

Did the British steal wealth of India from raw materials?

(or)

Would you care to dig deeper for being honest and truthful?

It is nice to believe Externalists, first glance.

Keep asking questions, be curious.

I am on a journey to seek answer, and invite you to explore,

Start with Angus Maddison's Work.

Angus's work in Allen's writing starts from 1820 - Present for GDP.

We require more data to answer questions

3. Some new terms, I learnt:

High-wage labor market
R&D Investment
Policies

Deus Vult,
Gottfried
Profile Image for Phakin.
440 reviews141 followers
June 12, 2020
ยอมครับ ยอมรับว่ามีประโยชน์ แต่อ่านหลายรอบมากกว่าจะจบ อ่านไปง่วงไป 55555
Profile Image for Dorotea.
386 reviews66 followers
November 7, 2017
Allen’s writing is clear and the material is fascinating. The central topic is the big divergence, the situation that it emerged from, its causes, the situation after (the ‘big push’) .

One distinctive element of the mercantilist era it’s that it witnessed an early modern globalisation because of the discovery of the New World and new sea routes to East Indies and Americas. This lead to the rise of north-western Europe (Britain, Netherlands, France) and the contemporary relative decline of the Mediterranean region, as well as the accumulation of human capital (knowledge of managerial techniques mainly because of the birth of corporations or joint stock companies such as the East India Company) and the improvement of existing technologies (especially in shipbuilding, weaponry, metallurgy and agriculture).
Data on incomes in the distant past are not robust, but it looks as though the differences in prosperity between countries until 1500 are small, but since the mercantilist era (1500-1800 with the voyages of Columbus and da Gama which led to an integrated global economy thanks to the Atlantic trade) an income gap has resulted from the industrial revolution and then it has expanded creating a divergence between rich and poor countries all throughout 1800s till 1913, as in the former period economic development was to the primary objective – but rather was political power. This changed in the catch-up period of the 19th century when Western Europe and the USA set four policies to close the gap with Great Britain: unification of the domestic market (creation of a unified national market by eliminating internal tariffs and building transportation infrastructure), protectionism (the erection of an external tariff to protect their industries from competition), modernization of banking ( the chartering of banks to stabilize the currency and finance industrial investment), and the establishment of mass education to upgrade the labour force.
Ronald Allen measures this gap through not only GDP per capita but also real wages of unskilled labour, which further proves the poverty trap (when wages decrease people cut back on extras such as education, luxury goods and healthy diet + when labour is cheap, the incentive to increase productivity via capital equipment is minimum-to-non-existent)
In the 20th century, the same policies proved to be less effective in countries that had not yet developed, since technology was not cost effective. There are exceptions to income divergence – Japan, South Korea, Taiwan and later on Soviet Union and China today – all thanks to a degree of planning and coordination of investment (developmental government).
Phenomena that explain this divergence are the shift in world manufacturing distribution and industrialization.
Profile Image for Kyle.
324 reviews
September 12, 2018
Very interesting book. At least, if you like reading about how countries industrialized, and the theories on how to effectively do so. Allen does a good job of explaining a rather convincing theory that high wages drove investments in high-capital labor saving devices/methods, which forms a positive feedback cycle, as the high-capital devices allow wages to increase, and so higher-capital devices can be introduced economically.

He also gives good accounts of other theories of how economic history such as staples (use a "staple" product to grow by exporting it), and industrial planning.

He tackles every area of the world and pretty much every time from 1500 (mostly focusing on Europe for the early times). Japan, Russia, Korea, Taiwan, and China get special mentions for accomplishing the catch-up of GDP/capita with Western Europe, with some thoughts on how and why.

Overall, just an interesting viewpoint as to how the world has gotten where we gotten. Allen does a good job of pointing out problems with theories and also accepting that no simple explanation will probably due. He ends with "The best policy to effect economic development, therefore, remains very much in dispute," which I think is a fitting ending for an area with so many uncertainties.
Profile Image for أحمد.
Author 4 books57 followers
November 16, 2015
كتاب جيد مبني على مجموعة من البيانات التي ينهمك في تحليلها طوال الكتاب مجيبًا على تساؤل لماذا هناك دول غنية ودول فقيرة ، مرورًا بالتاريخ الإقتصادي لهذه الدول ، ويصلح لغير المتخصصين.
Profile Image for Sina Mousavi.
28 reviews31 followers
January 29, 2020
This is one of the most remarkable exercises in concision that I have ever encountered, and the style worked rather well for me. I won't try to provide a summary of a text which is itself of an impressively dense summary of the economic history of the last 500 years. I will thus only mention the tidbits that I found interesting.

In the beginning, the main theme is the cause(s) of the Great Divergence: Why did the Industrial Revolution happen in Britain, and not somewhere else? The answer, shortly put, is that labour-saving inventions were incentivised in Britain, more so than anywhere else, due to a combination of high wages and cheap access to coal reserves. Globalisation and state economic policy also played important roles. Colonial exploration and settlement led to an integrated global economy and bigger markets, which made technical innovations even more appealing to European manufacturers.

I especially found the contrast that Allen drew between the British and the French state to be fascinating. Contrary to the imagination of laissez-faire fanatics (and Whig historians), he shows that the British state in the 17th and 18th centuries had, in fact, more authority and engaged in more economic interventions, not less, than its French counterpart. Taxation levels were twice the levels of France, and the doctrine of "Parliamentary Sovereignty" allowed for land appropriations, infrastructure projects and naval expansions (which facilitated British imperialism, thus resulting in economic gains) that simply were not possible in France, due to the influence of the French nobility:

Growth was also promoted by Parliament’s power to take people’s property against their wishes. This was not possible in France. Indeed, one could argue that France suffered because property was too secure: profitable irrigation projects were not undertaken in Provence because France had no counterpart to the private acts of the British Parliament that overrode property owners opposed to the enclosure of their land or the construction of canals or turnpikes across it. What the Glorious Revolution meant in practice was that the ‘despotic power’ of the state that ‘was only available intermittently before 1688 … was always available thereafter’.


The importance of the Industrial Revolution in shaping the course of human history cannot be understated. The pre-IR world, for the most part, is one in which long-term economic stagnation is the norm. Given this context, Britain's steady GDP growth by ~1.5% between 1760 and 1850 is an extraordinary achievement, one that is mainly made possible by innovations that expand the technological frontier.

Once Britain industrialised, it was only natural for the rest of the world to try and emulate its success. As the first US Secretary of Treasury, Alexander Hamilton developed an economic plan to catch up to the British, leading to the US overtaking Britain by the start of the 20th century. Hamilton's plan, which later influenced German and Japenese policymakers and became the "standard model" for economic growth, rested on four pillars:

1) Creating a unified internal market: Before the ratification of the American Constitution, levying tariffs on other American colonies (later states) was a common practice for American states to raise revenue. Hamilton, a Federalist and a believer in a strong and centralised state, managed to include the "Import-Export Clause" in the Constitution, preventing individual states to impose trade tariffs on each other. This, in conjunction with massive investments in transportation and local infrastructure, created an integrated domestic market in the US.
2) Protecting infant industries from foreign competition: For the majority of the 19th century, the US had some of the highest tariffs on imported manufactured goods in the world. Why? Hamilton was early to recognise the centrality of the establishment of modern manufacturing to economic development, which would not have been possible if British firms, more efficient than their American competitors at the time, were to dominate the American markets. Protectionism provided the American industry much-needed time to mature and import state-of-the-art British technology, without being outcompeted in the meantime. It was only after the end of the Second World War when the US was by far the most advanced economy on the planet, that American policymakers shifted from protectionism to free-trade, as they had very little to fear from global competition by that point.
3) Creating a central banking system to funnel investment and stablise the currency
4) Encouraging mass education: Highly literate and educated citizens are an essential part of any development strategy, as they are key to increasing worker productivity. Almost all innovators have to know reading, writing, and arithmetics, without any of which it would be possible to access the technical literature and/or discuss new discoveries with other innovators and scientists.

For countries that managed to implement all the four aspects of the "standard model" by the 20th century, the results were rather satisfying. But as the wage disparity widened between rich and poor countries, there were even fewer incentives for underdeveloped nations to adopt modern capital-intensive technology; Labour was simply too cheap to make such investments profitable, leading to a vicious cycle of poverty and backwardness. Under these conditions, extensive planning and "big push industralisation" efforts, as Allen puts it, form the winning formula for developing nations. Soviet Union between 1920-1970, post-war Japan, South Korea, and China adopt this approach to account for complementarities between different sectors, managing to close the gap with the industrialised West.
Profile Image for Jaq.
305 reviews32 followers
October 29, 2018
Un percorso, che vede nella scoperta dell'America e nell'età delle grandi esplorazioni l'inizio della globalizzazione (che ha portato il mondo ad essere ciò che è oggi), e che cerca di rispondere a questa sola domanda: perchè esistono paesi ricchi -che possiedono supremazia economica a livello globale- e paesi poveri, che vivono nella miseria e sottostanno al dominio di un economia dettata dall'Occidente che, in passato, li ha distrutti e che tutt'ora continua a farlo? Quand'è iniziata questa grande divergenza?

C'è un grande parallelismo, per la compessità della domanda posta in entrambi i testi, con il saggio di Diamond, 'Armi, acciaio, malattie'.
Profile Image for Martin.
27 reviews
March 27, 2022
Really great primer, gave me a few interesting leads to track down & orient my limited current knowledge of economic history & development economics within the broader scholarly debate & consensus. One thing I thought it short-changed on was the role of energy in helping spur technological progress and increasing complexity.
Profile Image for Ankyaa.
19 reviews16 followers
March 5, 2022
**Supremely succinct overview of modern economic history. Allen divides the last 500 years into three periods, the mercantilist era, the catch-up and the big push.**

Leads with the Great Divergence; the period of mercantilism and industrialization, and the discovery of the New World. Large regions of the world are washed into brief overviews, and slavery + colonialism are mostly glossed over. Although, I suppose that is to be expected of a remarkably short and Anglocentric book.

The Industrial Revolution became a turning point in history as it set off the era of sustained economic growth. Why Britain? Britain's high-wage and cheap-energy (due to coal deposits) economy at that time, created profitable conditions for businesses to use technology and capital intensive methods. High wages induced more capital-intensive production that led to even higher wages. Allen provides concise and highly contingent features of industrialisation in Western Europe, and its global impact. Colonialism + Globalisation + Western Technological Superiority led to the de-industrialisation of eastern empires. Western states enjoyed a self-reinforcing and ascending spiral of progress, while today's poor countries missed the elevator.

Allen describes a "Standard model" for economic development in the 19th century; a national market, universal or mass education, protectionist tariffs, advanced banking + financial system. He thinks these four policies were the necessary conditions to industrialise. Nations used these policies to varying degrees of success (expecially Latin American failures). The differences are attributed to geography, demographics and the global landscape at the time.

He briefly examines 'Africa' as a monolith and its failure to industrialise. Finally, he dives into Big Push industrialisation (primarily Russia+ East Asia): mass education, immense production and capital endeavours led by state owned / controlled pushes. These policies guided several nations in the late 20th & 21st centuries onto a pathway to prosperity.

Although several periods aren't given their due, there's limited discussions of different regions, and humdrum repetitions are abound (labour costs and shifts in production methods occupy half the work in the same monotonous manner), the book is an exceptionally concise and informative introduction to a gigantic discipline.
Profile Image for Hoda Nagm.
173 reviews80 followers
September 29, 2014

لماذا بدأت النهضة الإقتصادية من الغرب بالذات ولم تبدأ من أسيا وأفريقيا ؟
سؤال مهم يجيب عنه الكتاب بتفصيل عن طريق قراءة تاريخ الأمم ،
لكني هلخص الأمر في كام نقطة :

-إنجلترا بإعتبارها أكبر قوة عظمى في العالم منذ قرون خلت لم تصعد بمحض الصدفة بل بالإستعمار
وبأخذ ماثقل وزنه أو خف من الدول التي يصعد إقتصادها في ذلك الوقت كالهند مثلا
- أمريكا التي هي في الأصل خليط من بريطانيا وبقية الدول الغربية حذت حذو إنجلترا لكنها تعاملت بعنصرية أكبر وحصرت النمو الإقتصادي على طبقة نخبوية
بعدما همشت السكان الأصليين "الهنود الحمر" وإستعبدت الأمريكين من أصل أفريقي ، وسمح لها تحديد الطبقة الإقتصادية بالتحكم في مسار الأموال إلا أن التمييز جاء عليها بالسلبية أخيراً حتى قررت حظره
- بقية دول أفريقيا عانت من وبال الدولتين أعلاه حيث منع أفرادها من التعليم والعمل الحر والتحكم في المال أو الأراضي ، لدرجة أنه بعد حظر العبودية إستمر أهل البلد الواحد في إستعباد أفراد من قبائل أخرى
بغرض التكسب حيث كان الإقتصاد والتجارة قد تدهورت بالفعل بسبب سيطرة الحكومات الأخرى وتفشي الجهل
- كانت الكلمة السحرية هي "التعليم" حيث إنتبهت إليه الدول الغربية وبدأت في تنميته بشكل أكبر ،حيث كانت الأمية في أمريكا تتجاوز 40% ، ولكن أسيا وأفريقيا تأخرت عن الركب و لم تنتبه له إلا مؤخرا
كما أن الوسائل والأليات المستخدمة في الصناعة والزراعة في الشرق ماهي إلا نتاج الغرب ، وقلة الإبتكار أو الإعتماد على الخامات المتاحة في البيئة هو سبب مهم لتأخر دول أسيا وأفريقيا
- أخيرا اليابان ، كيف تمكنت من النمو مع أنها من ضمن دول أسيا وعليها ما عليهم بالضبط ؟
خلال حكم الإمبراطور توكوجاوا بدأت الحكومة تنتبه إلى أنه لازال هناك وقت ممكن للحاق بالركب ، فألقت العناية الكبرى "للتعليم" بعد أن جاوزت الأمية 60% وكان نصف أفراد البلاد على خط الفقر ، وبقية العناية ألقتها لتشجيع الصناعة حيث تم إنشاء أول مصنع للحديد في عصره وللزراعه نصيب من الدعم
وتم فتح أبواب السوق الحر وتوفير المساحة للمستثمرين وكان الإعتماد الكامل على طاقة المياه والطاقة النظيفة "يعني لا بترول ولا مايحزنون" .. أدت عمليات التنميه إلى إزدهار مبهر بدأ في الثمانينات وظهرت نتائجة في القرن العشرين فقط .
ولو لاحظتم يا سيدات وسادة الرابط المشترك بين كل الإقتصاديات الناجحه : التعليم ، التعليم ، التعليم ..

*كتاب إقتصادي تاريخي مميز ، أنصح به لمن يريد تكوين فكرة شاملة
Profile Image for xhxhx.
49 reviews30 followers
February 19, 2015
It could have been so much better.

A non-Marxist center-left account. No, that's not quite right. A Listian, Leninist and Preobrazhenskyan history of the world. A history of primitive accumulation and extractive growth.

A critically incomplete account. Provides the outputs of growth, trade, and labor market models, but does not articulate their premises. Offers a dubious account of capital and technology transfer. Offers the conventional (deprecated) account of underdevelopment in the periphery. Dismissive of Smith and the New Institutionalists, and of liberalism more generally.

Begs questions. There's a section that declares that Mexico supplied less education than Americans because Mexicans demanded less education than Americans, and that Mexicans demanded less education than Americans because they had lower consumption expectations than Americans. That's quite a departure from the premises underlying the rest of the book, where labor remains undifferentiated.

Provides aid and comfort to the anti-revisionists. Stalin and Mao get a good press here. Perhaps the most interesting section of the book is its unconventional account of economic development in the People's Republic. According to Allen, the infrastructure, technology, education supply and industrial base established under Mao set the stage for take-off growth after 1978. Institutional and policy change under Deng would have had no effect without that Maoist base.

Includes an excellent bibliography, without a single work by Gregory Clark.
Profile Image for Vivek Agarwal.
134 reviews3 followers
June 16, 2016
The perspectives in this book are not unlike the other history books I have previously read

The main difference is that this is as the title says a lot more concise and to the point

The chapter on Africa is vey interesting and shows how and why Africa has lost out on the development which the other emerging countries were able to build upon

The author is very careful in linking many variables very well through the book

Which includes the education, ago based economy, how and why the Industrial Revolution happened and why it happened and how it affected the world

How the changes in China and the other new emerging countries are affecting the balance of trade and how things might look in the near future based on this

Where is the growth going to be sustainable and why? (Or why not)

Interesting book with a few different perspectives on economic history which is worth reading and considering


Good book
I am considering looking at the other books in the series

Profile Image for SuNeO T..
7 reviews4 followers
June 25, 2019
ในบรรดาชุดหนังสือความรู้ฉบับพกพา เล่มนี้รู้สึกอ่านเข้าใจง่าย แม้ไม่ได้มีพื้นฐานด้านประวัติศาสตร์ประเทศของบางภูมิภาคมากนัก

หนังสือพยายามเชื่อมโยงปัจจัยที่ส่งผลต่อความเจริญทางเศรษฐกิจของแต่ละประเทศ หรือ ภูมิภาคต่างๆ เช่น
- ในแง่ของภูมิศาสตร์ มีผลทำให้การพัฒนาของอเมริกาเหนือและใต้ต่างกันเพราะอะไร
- ทำไมการปฏิวัติอุตสาหกรรมถึงเกิดขึ้นที่อังกฤษไม่ใช่ฝรั่งเศส หรือ ประเทศอื่นๆในยุโรป
- ทำไมปัจจัยที่เคยส่งผลให้ประเทศนึงประสบความสำเร็จ เมื่อนำมาใช้กับอีกประเทศถึงได้ผลลัพธ์ต่างกัน
- ปัจจัยที่ทำให้ในช่วงที่โลกเริ่มเข้าสู่ยุคสมัยใหม่ช่วงหลัง (ศตวรรษที่19-20) ญี่ปุ่นเป็นประเทศเดียวในเอเชีย สามารถพัฒนาเศรษฐกิจจนยืนหยัดได้เทียบเท่าชาติตะวันตก
- ขั้วอำนาจโลกเปลี่ยนมาเป็นอเมริกาได้อย่างไร

เป็นหนังสือที่ระหว่างอ่านเปิดAtlasไปด้วย สนุกดี กระตุ้นต่อมความอยากรู้ประวัติศาสตร์ประเทศอื่นๆมากขึ้น
Profile Image for Ismoil Sadullozoda.
42 reviews2 followers
January 12, 2021
This very short introduction is a good start to economics for students of non-economic fields. It introduces many economic terms, concepts, and theories with lots of quantitative data. It also gives many economic measurements that can be applied individually to analyze the social and economic state of different societies.

I recommend reading this book with "Why Nations Fail" by J. Robinson and D. Acemoglu. Many concepts and processes that are introduced in this short introduction can be found in a more revealed form in the mentioned book.
Profile Image for Pat Hornchaiya.
40 reviews2 followers
December 30, 2014
เป็นหนังสือทางเศรษฐศาสตร์ที่ดี และอธิบายสาเหตุต่างๆในทางเศรษฐกิจโลกอย่างน่าสนใจ ตอบคำถามที่ว่าทำไมบางประเทศร่ำรวย บางประเทศยากจนที่สอดคล้องกับปัจจุบันได้ดีมา���
Profile Image for Chakkrit P..
30 reviews3 followers
May 15, 2015
......... อ่านเว่อร์ชั่นภาษาไทย...........

เป็นหนังสือที่ดีสำหรับคนที่สนใจประวัติศาสตร์ด้านเศรษฐศาสตร์ของโลก แรกๆอ่านอาจจะน่าเบื่อและงงๆ แต่พออ่านไปได้สักพักจะค้นพบว่าเขียนได้กระชับและสนุกมาก

Profile Image for violet✦.
42 reviews14 followers
Read
February 4, 2023
i am never taking an econ class again (this was actually pretty great and changed my understanding of the world immensely)
69 reviews2 followers
March 1, 2022
Robert C. Allen tells us in his introduction to the subject that economic history seeks to explain the nature and causes of national prosperity by examining the process of historical change.

Two essential questions hover above the subject.

First, why did the western Eurasian peninsula and its colonial offshoots diverge in such spectacular fashion from the cyclical Mathulsian limits that had hitherto characterised human history?

Second, how did those few countries that caught up with the West do so?

Trailing those two primary questions are the secondary ones of why the Great Divergence was a regional phenomenon, and why the rest ain’t as rich as the West (+ Japan and the East Asian tigers)?

The book shines when it examines those questions. Vim, vigour, dash, brio! are some of the words that came to mind as I read. In contrast, a rather out of place chapter on Africa is dull, disjointed and flaccid, as literature reviews inevitably are.

In lieu of the antiseptic BCE and CE, consider, instead, B1500 and A1500.
B1500, the wealthiest places on earth—those locations with the greatest concentration of sheer lucre—were the typically Asian empires astride great trading regions and vast metropolises fed by plough-powered, irrigated agriculture. Ming-era China and Mughal India are archetypes. Equally prosperous were city-sized emporia that linked demand and supply across the known world. Venice and Antwerp are justly famous, but there were also places like Alexandria, Ragusa and Dubrovnik.

A1500, things changed. First in the mercantilist phase, c.1500-1800, in a vast burst of expansionary energy, mediaeval European empires like England, Portugal and Spain bound over the Pillars of Hercules into the New World and Asia.

The Americas were settled. They soon exported bullion, tobacco and sugar mined and cultivated by vassalized, enserfed and enslaved Amerindians and Africans. Much of those exports went to Europe, the rest went to Asia. In turn, the Asians traded spices, textiles and porcelain. Those products were circulated across a global market whose shipping, through force, guile and sheer competitiveness, had become a near European monopoly. Note that the Asian exports were industrial products. That becomes important later.

The British beat the Dutch and the French to emerge mistress of the seas in the mercantilist age. She held India, valuable Caribbean isles and an increasing number of naval bases across the world.
While the French, her closest rivals, dallied with revolution, the British mastered a general-purpose technology called steam. By the time Napoleon was cashiered, Britain was in a similar position that her star-spangled descendant would find himself after WW2.

By 1815, Britain was the workshop of the world and London, her greatest city, was becoming the place where British Capital did the world’s business. Britain had made it to the Champions League/The Playoffs while other countries were battling for seeding.

Western Europe and the USA were the first of the rest to make the grade. Their secret sauce was free trade, abolishing tariffs and embracing their comparative advantage.

Kidding.

Instead of those policies, they shifted their comparative advantage.

How?

They unified their national markets via infrastructure and demolished regional barriers, protected their infant industries from British competition, created Central Banks and well-capitalised financial institutions and embraced the mass education of their labour force.

While those future champions had their training montages, British industrial competition ate everyone else up and asked for dessert.

During the reign of Mad King George, the British share of global manufacturing was around 2%. In 1887, when his successor, twice removed, the British Queen-Empress Victoria celebrated her silver jubilee, Britain accounted for at least a quarter of global manufacturing. Unsurprisingly, her jubilee was a time for pomp and circumstance. Perhaps, for all but one. He wrote: ‘For frantic boast and foolish word— Thy mercy on Thy People, Lord!’

High wages, adjusted for inflation, Professor Allen writes, was the secret formula that explained the iteration of machine-driven production in Great Britain and, later, the West. To wit: ‘The incentive to increase the amount of machinery used by each worker is greatest where labour is dearest’. In sum, the Industrial Revolution did not cause high wages, it needed them to exist. Now go out, and buy this book.
Profile Image for g.
Author 68 books132 followers
October 4, 2021
Conjeturas macroeconómicas bien explicadas. Allen intenta entender por qué hay países ricos y países pobres. La complejidad del problema hace que cualquier respuesta resulte escasa, inclusive las respuestas de Allen que cuentan con coherencia y una especie de contrastación blanda hecha de tablas estadísticas. Una lectura de lector salteado deja una fuerte sensación de alegre sesgo confirmacionista. Entusiasmo porque parece tener sentido y escepticismo porque el problema parece ser mucho más complejo que la conjunción de 4 factores. Para seguir pensando.
Profile Image for Nourhan.
143 reviews27 followers
July 29, 2022
يجيب الكتاب على تساؤل هام و هو لماذا انطلق النمو الاقتصادي في أوروبا وليس في آسيا أو أفريقيا؟ في سياق تاريخي ممتع و إقتصادي مبسط .. أرشحه للمبتدئين في القراءة عن الإقتصاد. يتحدث الكتاب عن بداية الثورة الصناعية و الاسباب التي دفعت لقيامها و النتائج المترتبة. كما يأخذنا في رحلة لنشأة أمريكا و كيف تطور اقتصادها، كما تحدث عن الاسباب الممكنة لبقاء القارة السمراء فقيرة منذ القدم إلى الآن. و يتناول الكتاب أيضاً مساعي الدول المختلفة للحاق بركب الثروة الصناعية كاليابان و الصين و الاتحاد السوفيتي

أهم الاحداث من القرن ال15 إلى القرن ال17

العولمة الأولى: كانت الثورة الصناعية نفسها نتيجة المرحلة الأولى من العولمة التي بدأت في نهاية القرن الخامس عشر مع رحلات كولومبس وماجلان وغيرهما من المستكشفين العظام، ومن ثَمَّ فإن الفجوة الكبرى بدأت مع العولمة الأولى.

اقترح البحَّار كريستوفر كولومبس — وهو من مدينة جنوة — الطريق البديل للإبحار غربًا من أوروبا إلى آسيا مباشرًة، ورست سفن كولومبس في جزر البهاما في ١٢ أكتوبر ١٤٩٢ ، مقتنعًا بأنه وصل إلى الهند الشرقية، لكنه في الحقيقة كان قد اكتشف الأمريكتين — الحدث الذي غيَّر من تاريخ العالم .وفي عام ١٤٩٨ ، وصل فاسكو دا جاما (أول أوروبي يصل) إلى في الهند. أطلقت رحلات كولومبس ودا جاما صراعًا حول إقامة الإمبراطوريات.

كانت إمبراطورية إسبانيا أكثر ثراءً، وتمثَّلت أعظم نجاحات إسبانيا في غزو إمبراطورية الأزتك وإمبراطورية إنكا. أدَّى نهب إمبراطورياتَيْ الأزتك والإنكا إلى إثراء إسبانيا ثراءً فاحشًا في الحال، وقد تبع تلك الغزوات اكتشاف مناجم هائلة للفضة في بوليفيا والمكسيك، وقد ساهم تدفق الفضة إلى إسبانيا في تمويل جيش هَبسبورج الذي كان يحارب البروتستانتيين عبر أوروبا، كما وفَّر السيولة النقدية للأوروبيين لشراء السلع الآسيوية، وأطلق عقودًا من التضخم صارت تُعرَف باسم ثورة الأسعار.

لم يصبح الأوروبيون الشماليون قوى استعمارية ذات ثقل حتى القرن السابع عشر، وكانت المنظمة المفضَّلة لديهم هي شركة الهند الشرقية التي جمعت بين النشاط الاستعماري والنشاط التجاري. وكانت تمتلك قوات عسكرية وبحرية.امتلكت جميع القوى الشمالية شركات كهذه، وقد تأسست شركة الهند الشرقية الإنجليزية في عام ١٦٠٠ ، ثم
نظيرتها الهولندية بعدها بعامين.

في القرن السابع عشر، كانت الصين والهند أكبر معقلين لصناعة القطن في العالم. بدأت شركات الهند الشرقية المختلفة في تصدير المنسوجات القطنية والموسلين إلى أوروبا في أواخر القرن السابع عشر؛ حيث نجحت هذه المنسوجات في منافسة الكتان والصوف، وهي المنسوجات الأوروبية الرئيسية. لقد كانت عملية غزل القطن تمثِّل جوهرالمشكلة، وقد ظل المخترعون يعملون على التوصل إلى أفضل الحلول لها منذ ثلاثينيات القرن الثامن عشر على الأقل.

أفريقيا: بدأ الاستعمار الأوروبي بالبرتغاليين الذين أقاموا مستعمرات فيما يُعرَف اليوم بغينيا وأنجولا وموزمبيق في القرنين الخامس عشر والسادس عشر، ثم أقامت القوى الأوروبية الأخرى حصونًا على ساحل غرب أفريقيا لتسهيل تجارة العبيد. اتخذ الاستعمار الأوروبي
شكلًا أكثر جدية في القرن التاسع عشر، بَيْدَ أن تقسيم القارة بين القوى الاستعمارية لم يحدث إلا مع نهاية القرن.

أهم الاحداث من القرن ال18 إلى القرن ال19

أعلنت الولايات المتحدة الأمريكية الاستقلال عن بريطانيا في عام 1776

كان خط السكك الحديدية العام الأول هو الخط الذي كان يربط بين ليفربول ومانشستر، والذي امتد لمسافة ٣٥ ميلًا وافتُتِح في عام ١٨٣٠ . حقَّق هذا الخط نجاحًا كبيرًا، وأطلق حمى ترويج بناء خطوط سكك حديدية في بريطانيا.


بين عامَيْ ١٧٥٠ و ١٨٨٠ ، كانت الثورة الصناعية البريطانية هي الحدث الأكبر تميَّزت الفترة من عام ١٨٨٠ إلى الحرب العالمية الثانية بتحوُّل الولايات المتحدة الأمريكية وقارة أوروبا — لا سيما ألمانيا على وجه الخصوص — إلى دول صناعية.

في منتصف القرن التاسع عشر، كانت بريطانيا «ورشة العالم» حيث كانت تنتج معظم المصنوعات التي يتم تصديرها في العالم. احتفظت بريطانيا بمكانتها التجارية ببيع منتجاتها إلى مستعمرات إمبراطوريتها، وقد أدى ارتفاع قيمة تكوين الإمبراطورية على هذا النحو إلى تفجُّر الصراع على المستعمرات بين الاقتصادات الصناعية. انطوى تفوُّق ألمانيا على بريطانيا في إنتاج الصلب على تداعيات في مجال تصنيع العتاد العسكري، وقد أدت المنافسة التجارية بين بريطانيا وألمانيا إلى إثارة التوترات الدولية قبيل الحرب العالمية الأولى.

في القرن ال 19، لم تكتفِ دول أوروبا الغربية باللحاق بالدولة الرائدة، بل انضمت إليها أيضًا في تكوين مجموعة من المبتكِرين الذين سعَوا معًا إلى تطوير التكنولوجيا في العالم منذ ذلك الحين. بطبيعة الحال، تحوَّلت أمريكا الشمالية إلى دولة صناعية في القرن التاسع عشر، ثم سرعان ما انضمت إلى نادي الابتكار

في القرن التاسع عشر، ظهرت حزمة من سياسات التنمية التي ساعدت دولَ القارةِ الأوروبية على اللحاق برَكْب بريطانيا وهي إنشاء سوق وطنية كبيرة من خلال إلغاء التعريفات الداخلية وتطوير وسائل النقل، وفرض تعريفات جمركية خارجية لحماية الصناعات الوليدة من المنافسة البريطانية، و بنوك لتحقيق استقرار في أسعار العملة وتوفير رأس المال للشركات، وأخيرًا، نشر التعليم العام للإسراع من عملية استخدام التكنولوجيا وابتكارها.


بحلول عام ١٨٥٠ ، كانت دول أوروبا وأمريكا الشمالية قد تقدمت على سائر دول العالم، وتمثَّلت المشكلة الجديدة في كيفية لحاق الدول الفقيرة بها. لم يكن في وسع المستعمرات فعل الكثير إزاء هذا الأمر؛ إذ كانت القوى الإمبريالية تقيِّد خياراتها، ولكن كان في إمكان الدول المستقلة تطبيق النموذج القياسي — متمثِّلًا في إنشاء خطوط السكك الحديدية،
وفرض التعريفات الجمركية، وإنشاء البنوك والمدارس — الذي نجح في الولايات المتحدة وأوروبا الغربية، وبمرور الوقت أصبحت هذه الاستراتيجية أقل فعالية.

كانت المستعمرات الأفريقية الأولى — على غرار نظيراتها السابقة عليها في أمريكا الشمالية — تُدار من خلال «الحكم المباشر»؛ حيث كانت الحكومات الاستعمارية تطبِّق قانون الدولة الأم في جميع الأراضي التابعة على كلٍّ مِن المستوطنين والسكان الأصليين على حد سواء، وإنْ لم يتمتع السكان الأصليون بكامل حقوقهم في غالب الأحيان. بنهاية القرن التاسع عشر، حل «الحكم غير المباشر» محل الحكم المباشر، وكان الغرض من ذلك هو جعل الاحتلال الأجنبي أكثر قبولًا للسكان الأصليين من خلال الاعتراف بالاختلافات العرقية جميعها، ومن خلال منح السلطة والثروة إلى القادة المتعاونين في مقابل دعم الأجانب.

صمم كارل بنز السيارة العملية الأولى في عام 1885


مقتطفات من الكتاب

إن التاريخ الاقتصادي درَّة العلوم الاجتماعية؛ فموضوعه الرئيسي يدور حول «طبيعة وأسباب ثروة الأمم»؛ وقد صار التاريخ الاقتصادي مجالًا مثيرًا للاهتمام في السنوات الأخيرة؛ منذ أن أصبح نطاق السؤال: «لماذا ثَمَّة دول ثرية وأخرى فقيرة؟» نطاقًا عالميًّا. قبل خمسين عامًا، كان السؤال هو: «لماذا اندلعت الثورة الصناعية في إنجلترا وليس فرنسا؟» و يجب أن يكون السؤال اليوم هو: لماذا انطلق النمو الاقتصادي في أوروبا وليس في آسيا أو أفريقيا؟

كان التغير التكنولوجي هو محرك الثورة الصناعية؛ فقد جرى ابتكار العديد من الاختراعات المشهورة مثل المحرك البخاري، وماكينات غزل القطن ونسجه، والعمليات الجديدة لصهر وتنقية الحديد والصلب باستخدام الفحم بدلًا من الخشب. بالإضافة إلى ذلك، ظهرت آلات كثيرة أخرى بسيطة أدت إلى زيادة إنتاجية الأيدي العاملة في صناعات عادية، مثل صناعة القبعات والدبابيس والمسامير.

يرجع السبب في فقر الدول الفقيرة إلى أنها تستخدم التكنولوجيا التي طورتها الدول الغنية في الماضي. وتُعتبَر أكثر الصناعات نجاحًا في العديد من الدول النامية هي صناعة الملابس؛ حيث تُعتبَر التكنولوجيا الرئيسية هي ماكينة الخياطة. فنجاح التصدير في معظم الدول النامية اليوم قائم على تكنولوجيا القرن التاسع عشر.
الدول الفقيرة اليوم لم تلحق بركب الصعود، فتنخفضفيها الأجور وترتفع تكاليف رأس المال، ومن ثَمَّ لا تملك هذه الدول سوى التكيُّف مع استخدام التكنولوجيا العتيقة والأجور المنخفضة.

ويُعَدُّ تقدُّم الأمريكتين أنفسهما مثالًا حيٍّا على الانقسام العالمي بين الشمال الغني والجنوب الفقير. كانت أمريكا الشمالية تحظى بالأفضلية. أولًا، كانت أمريكا الشمالية أقرب إلى أوروبا التي كانت السوق الرئيسية لصادرات المستعمرات، كما كان يمكن بلوغ أعماق القارة من خلال أنهار سانت لورانس وموهوك هدسون والمسيسيبي. في المقابل، كانت معظم الأنشطة الاقتصادية في أمريكا اللاتينية تجري في أعماق المكسيك ومنطقة جبال الأنديز. لم تصل الأنهار بين هذه الأقاليم والسواحل، ومن ثَمَّ كانت تكلفة التصدير مرتفعة.

أدت أمراض المناطق الاستوائية إلى ارتفاع نسبة الوفيات بين الأوروبيين في مناطق الكاريبي والأمازون، وهو ما أدى إلى انخفاض نسبة نمو السكان الأوروبيين فيها. كان السكان الأصليون موزَّعين على نحوٍ غير متساوٍ عبر الأمريكتين. عاش معظم السكان الأصليين في المكسيك (٢١ مليونًا)، أو الأنديز (١٢ مليونًا)، في المقابل لم يَعِشْ سوى خمسة ملايين فقط من السكان الأصليين في الولايات المتحدة. يرجع جزء كبير من هذا الانخفاض في عدد السكان الأصليين إلى ظهور الأمراض؛ مثل الجدري والحصبة والأنفلونزا والتيفوس، التي لم يكن لدى السكان الأصليين أي مناعة ضدها، أما الأسباب الأخرى فتتمثل في الحروب والاستعباد والمعاملة السيئة من قبل المستوطنين

تمثِّل اليابان حالة خاصة مثيرة للاهتمام؛ حيث إنها كانت الدولة الآسيوية الأولى التي تلحق بالغرب. ينقسم التاريخ الياباني إلى أربع فترات: عصر توكوجاوا (١٦٠٣–١٨٦٨) عندما كان يحكم البلاد حكام عسكريون (الشجونيون) من قبيلة توكوجاوا، وعصر الإمبراطور ميجي (١٨٦٨–١٩٠٥) عندما استردَّ الإمبراطور ميجي سلطته وبدأت عملية التحديث الاقتصادي، والفترة ��لاستعمارية (١٩٠٥–١٩٤٠) عندما أُنشئت الصناعات الثقيلة، وأخيرًا عصر النمو السريع (١٩٥٠–١٩٩٠) عندما لحقت اليابان بركب الدول الغنية الغربية.

في عام ١٨٣٩ ، هاجمت بريطانيا الصين لإجبارها على السماح باستيراد الأفيون، الذي كان أحد أكثر منتجات شركة الهند الشرقية تحقيقًا للربح، وقد انتصرت الإمبريالية التي تروِّج للمخدرات بهزيمة الصين في عام ١٨٤٢

كانت الساعة اليابانية التقليدية تقسِّم الوقت من شروق الشمس إلى غروبها إلى ست ساعات، ومن غروب الشمس إلى شروقها إلى ست ساعات أخرى؛ ومن ثَمَّ اختلفت الساعة النهارية عن الساعة الليلية في مدة كلٍّ منهما، بل واختلف طول كلٍّ منهما على مدار السنة. ألغت الدولة نظام التوقيت الياباني التقليدي واعتمدت نظام التوقيت الغربي القائم على ٢٤ ساعة في اليوم؛ فنظام النقل الحديث استلزم وجود نظام توقيت حديث.

توصَّلت الشركات اليابانية إلى حلٍّ لمشكلة استيراد التكنولوجيا من خلال إعادة هندستها لتناسب الظروف اليابانية. كانت صناعة حَل الحرير مثالًا مبكِّرًا. أقامت عائلة أونو التجارية مصنعًا استخدم ماكينات استلهمت التكنولوجيا الأوروبية. في هذه الحالة، صُنعت الماكينات من الخشب بدلًا من المعدن، وتمثَّلَ مصدر الطاقة في رجال يديرون أذرع دوَّارة بدلًا من الاعتماد على المحرك البخاري.
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الفجوة الكبرى: حقَّقت أوروبا والدول التي كانت تتبع بريطانيا دخولًا أعلى في عام 1820 م و إلى الآن حققت زيادات في الدخول تراوحت بين ١٧ و ٢٥ ضعفًا، أما مناطق جنوب آسيا والشرق الأوسط ومعظم دول أفريقيا جنوب الصحراء فقد كانت أقل حظٍّا؛ حيث إنها كانت أكثر فقرًا في عام ١٨٢٠ ، ولم تحقِّق زيادات في متوسط الدخل إلا في حدود من ثلاثة إلى ستة أضعاف. هناك استثناءات لهذه الفجوة في مستويات الدخول وتعتبر اليابان هي قصة النجاح الأعظم في القرن العشرين و كذلك كوريا الجنوبية و تايوان

ويرى الكثير من خبراء الاقتصاد أن النجاح الاقتصادي إنما ينشأ عن تأمين حقوق الملكية، وخفض الضرائب، وتقليص التدخل الحكومي. يعتبر استبداد الحكومات أمرًا سيئًا للنمو؛ حيث يؤدي إلى زيادة الضرائب واللوائح والفساد ونزعة الجباية
Profile Image for Adam.
996 reviews196 followers
July 6, 2018
This book is not so much a history of the global economy as it is a comparative study of economic development after the Industrial Revolution. Its premise is that at around 1800, most nations had more or less the same size economy relative to their population – i.e., they were all poor despite the existence of some small elite. But from that point, the richest nations experienced a spiral of growing population, GDP, education, and industrial output, while the poorest nations continued to grow slowly despite access to increasingly productive technology and global markets. Later, some countries in the middle became rich through another path. The general question of the book is what is that spiral of growth and what allowed it to happen in some places and not others?

The first question is arguably a variant of the Jared Diamond "cargo" question: why did economic growth take off in Europe before anywhere else, and within Europe, why in England before any other nation? Allen begins his explanation with globalization. The richest nations in Europe were those engaged in the most trade around the world (Britain and the Netherlands). That meant that, for the first time in an agrarian society, high wages were not necessarily linked to a small market for goods. Allen doesn't reference secular cycles explicitly, but the logic is the same and I think it is more clear to think of it in those terms. What would normally happen is that the price of labor and thus manufactured goods (whose costs derives mainly from labor) would be high when population is low and vice versa. There would be no incentive to invest in capital to enhance the productivity of scarce labor because the price of labor would fall faster than the market would grow. With globalization, high wages and growing international markets combined to give capitalists the incentive to invest in research and development of laborsaving technologies.

Allen takes it for granted that the IR was caused by intentional R&D spending on a social scale if not by each company. He gives a fairly in-depth treatment of the technological iterations involved in cotton production, emphatically making the point that this was a process of technological evolution driven by sustained price competition and high wages.

The British industrial sector was initially protected from competition with (primarily) Indian cotton by transport costs. The low price of labor in India and many parts of Europe prevented the immediate adoption of laborsaving technologies elsewhere, preserving the technological advantage of the British businesses long enough for them to refine the machines. In the meantime, the price of British cotton and of transportation became low enough that British companies could outcompete native manufacturing in India. I was not aware of the fact that the handicraft cotton spinning industries in India and China were largely the same proportion of the economy as they were in Britain immediately before the Industrial Revolution, but shrank to almost nothing shortly thereafter. As soon as British cotton was cheaper to produce and ship to India than local laborers could spin it by hand, those laborers were better off in the short term working in agriculture, growing food to trade for British manufactured goods.

That leads to one of the points that I found most surprising. Britain was obviously not the only country to benefit from the Industrial Revolution. So the next question is why did some countries get on the same escalating spiral while others did not? The example of India hints at one explanation: competition. As long as imports are cheaper than native products could be, it is not worthwhile to invest in capital intensive technologies to try to compete. Some countries, like the United States and Germany, had high wages and were more or less able to join the Industrial Revolution as it began. Others, like India, experienced deindustrialization. Once they had missed the beginning, it was hard to step on that later points, because the population was not being educated and wages were not growing to justify the investment.

Which raises the question that is in some ways the most relevant today: how have some nations jumped onto that spiral while others remained at the bottom? Early on, the answer seems to lie in a "standard package" of development policies including eliminating internal tariffs, imposing external tariffs, and subsidizing education and transport networks. The US and Germany, among many others, took this approach and found it very successful. What I found surprising was the emphasis answer places on external tariffs, which I assumed economists found unwelcome in practically every circumstance. The implication that developing economies imposing external tariffs is in the long-term interest of their citizens, and that countries like the US now seek to destroy because our industries are now dominant and need markets more than protection, feels more like something you would hear in a NAFTA protest than an economics book.

Conversely, this "standard package" no longer seems to be effective as of the 20th century. Because rich countries have climbed so high on the development ladder,
enormous investments are required to jump to that level. Economies of scale mean that a steel plant or an automobile factory must be extremely large to compete on an international level, and many national economies are not large enough markets to support them. The answer once again seems to contradict contemporary economic conventional wisdom: Government planning. In China, Russia, and Japan, industrial development was kick started by targeted investment from government banks, which apparently demanded large scale production on the assumption that demand would rise to meet it. While part of this process was jumping up to the current level of efficient scale, the other part involved scaling down some machinery to be efficient at current wages.

It's interesting to note the balance in explanatory mechanisms Allen offers. In general, he has little faith in a cultural or institutional explanations and tends to prefer materialist ones. He does not totally dismiss the importance of bad policy, but he emphasizes that underlying economic conditions can work around or overcome it. He gives several interesting examples of cases where cultures and governments with policies or predilections many feel should discourage economic development in fact experienced rapid growth (the most obvious being China). On the other hand, the "standard model" and Big Push models of industrialization both feel more or less entirely up to the government.

There has to be some limit to how far a "Very Short Introduction" can follow the causal chain, so it would be reasonable for Allen not to spend much time going into the political economy of why some governments made those efforts and others did not. And for the most part he does, but there are some good insights in that vein. He suggests that many of the Latin American ex-colonies (and the Southern US) persisted in extremely divided and unequal societies, in which white elites did not want to grow the economy in ways that would benefit society in general (whereas New England had a more equal economy of small farmers and merchants and a democratic spirit friendly to investing in education). Colonial governments have more or less the same relationship, though exogenous instead of endogenous. India, for instance, seems to perhaps have suffered in comparison to China for this reason. Those ambitious development policies are universally beneficial in the long run, but a major lesson I think this book emphasizes is that for the most part things progress in small steps that are all beneficial in the short term or they don't progress at all. In that light, a Big Push investment is a feat of ultracooperation that requires more social capital than many countries possess, especially among often corrupt ruling classes.

Overall it's a remarkable dense but very accessible, and very even handed intro to the topic. More discussion of the debate on certain issues might be useful.
Profile Image for AnnaG.
437 reviews27 followers
March 3, 2018
A good overview of economic history. The narrative elements explaining statistically what happened when are thorough and interesting, some of the analysis seems a little superficial e.g. the authors implies in the Africa chapter that with tariffs, banks and schools any part of the world could develop and Africa was held back by colonial policies that prevented it from enacting these measures; however a chapter later he shows that Latin America did enact those policies and it still didn't work; by contrast Japan which arguably suffered a greater challenge than Africa in development (in that it lacks land and natural resources), managed to find a way forward through innovation that Africa could seemingly just as easily have followed.

The two components that seem to be missing from the analysis are Energy and Geography. Tim Marshall's Prisoners of Geography: Ten Maps That Tell You Everything You Need to Know About Global Politics makes a good case that Africa and South America having impenetrable interiors (Amazon, Sahara and Congo Rainforest) are at a real disadvantage to Europe with its more hospitable terrain e.g. navigable waterways that makes trade between nations simple. It's an excellent book and well worth a read. Similarly this book doesn't distinguish between the cost of energy and the cost of capital, whilst he mentions Britain's coal as being a driver of the industrial revolution, I think he underestimates how much of a difference it makes to have cheap energy. Once energy can substitute for labour, the workforce can be made redundant in the industries they are in and whilst that causes real social harm, the freed up labour force can them be moved to other sectors to make new things or provide new services. Frank Trentmann's Empire of Things: How We Became a World of Consumers, from the Fifteenth Century to the Twenty-First provides a (very) thorough examination of this process and how we have come to have so much more stuff in our lives.
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