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The Great Divergence or European miracle is the
socioeconomic Socioeconomics (also known as social economics) is the social science that studies how economic activity affects and is shaped by social processes. In general it analyzes how modern societies progress, stagnate, or regress because of their loca ...
shift in which the
Western world The Western world, also known as the West, primarily refers to the various nations and states in the regions of Europe, North America, and Oceania.
(i.e.
Western Europe Western Europe is the western region of Europe. The region's countries and territories vary depending on context. The concept of "the West" appeared in Europe in juxtaposition to "the East" and originally applied to the ancient Mediterranean ...
and the parts of the
New World The term ''New World'' is often used to mean the majority of Earth's Western Hemisphere, specifically the Americas."America." ''The Oxford Companion to the English Language'' (). McArthur, Tom, ed., 1992. New York: Oxford University Press, p. 3 ...
where its people became the dominant populations) overcame
pre-modern The term premodern refers to the period in human history immediately preceding the modern era The term modern period or modern era (sometimes also called modern history or modern times) is the period of history that succeeds the Middle Ages (w ...
growth constraints and emerged during the 19th century as the most powerful and wealthy world
civilization A civilization (or civilisation) is any complex society characterized by the development of a state, social stratification, urbanization, and symbolic systems of communication beyond natural spoken language (namely, a writing system). ...
, eclipsing the
Ottoman Empire The Ottoman Empire, * ; is an archaic version. The definite article forms and were synonymous * and el, Оθωμανική Αυτοκρατορία, Othōmanikē Avtokratoria, label=none * info page on book at Martin Luther University) ...
,
Mughal India The Mughal Empire was an early-modern empire that controlled much of South Asia between the 16th and 19th centuries. Quote: "Although the first two Timurid emperors and many of their noblemen were recent migrants to the subcontinent, the ...
,
Qing China The Qing dynasty ( ), officially the Great Qing,, was a Manchu-led imperial dynasty of China and the last orthodox dynasty in Chinese history. It emerged from the Later Jin dynasty founded by the Jianzhou Jurchens, a Tungusic-speak ...
, Tokugawa Japan, and
Joseon Korea Joseon (; ; Middle Korean: 됴ᇢ〯션〮 Dyǒw syéon or 됴ᇢ〯션〯 Dyǒw syěon), officially the Great Joseon (; ), was the last dynastic kingdom of Korea, lasting just over 500 years. It was founded by Yi Seong-gye in July 1392 and r ...
. Scholars have proposed a wide variety of theories to explain why the Great Divergence happened, including
geography Geography (from Greek: , ''geographia''. Combination of Greek words ‘Geo’ (The Earth) and ‘Graphien’ (to describe), literally "earth description") is a field of science devoted to the study of the lands, features, inhabitants, an ...
,
culture Culture () is an umbrella term which encompasses the social behavior, institutions, and norms found in human societies, as well as the knowledge, beliefs, arts, laws, customs, capabilities, and habits of the individuals in these groups.Ty ...
,
institutions Institutions are humanly devised structures of rules and norms that shape and constrain individual behavior. All definitions of institutions generally entail that there is a level of persistence and continuity. Laws, rules, social conventions a ...
,
colonialism Colonialism is a practice or policy of control by one people or power over other people or areas, often by establishing colonies and generally with the aim of economic dominance. In the process of colonisation, colonisers may impose their relig ...
,
resources Resource refers to all the materials available in our environment which are technologically accessible, economically feasible and culturally sustainable and help us to satisfy our needs and wants. Resources can broadly be classified upon their a ...
and just pure chance. There is disagreement over the nomenclature of the "great" divergence, as a clear point of beginning of a divergence is traditionally held to be the 16th or even the 15th century, with the
commercial revolution The Commercial Revolution consisted of the creation of a European economy based on trade, which began in the 11th century and lasted until it was succeeded by the Industrial Revolution in the mid-18th century. Beginning with the Crusades, Europea ...
and the origins of
mercantilism Mercantilism is an economic policy that is designed to maximize the exports and minimize the imports for an economy. It promotes imperialism, colonialism, tariffs and subsidies on traded goods to achieve that goal. The policy aims to reduce a ...
and
capitalism Capitalism is an economic system based on the private ownership of the means of production and their operation for profit. Central characteristics of capitalism include capital accumulation, competitive markets, price system, private pr ...
during the
Renaissance The Renaissance ( , ) , from , with the same meanings. is a period in European history marking the transition from the Middle Ages to modernity and covering the 15th and 16th centuries, characterized by an effort to revive and surpass ide ...
and the
Age of Discovery The Age of Discovery (or the Age of Exploration), also known as the early modern period, was a period largely overlapping with the Age of Sail, approximately from the 15th century to the 17th century in European history, during which seafarin ...
, the rise of the European
colonial empires A colonial empire is a collective of territories (often called colonies), either contiguous with the imperial center or located overseas, settled by the population of a certain state and governed by that state. Before the expansion of early mod ...
,
proto-globalization Proto-globalization or early modern globalization is a period of the history of globalization roughly spanning the years between 1600 and 1800, following the period of archaic globalization. First introduced by historians A. G. Hopkins and Chris ...
, the
Scientific Revolution The Scientific Revolution was a series of events that marked the emergence of modern science during the early modern period, when developments in mathematics, physics, astronomy, biology (including human anatomy) and chemistry transforme ...
, or the
Age of Enlightenment The Age of Enlightenment or the Enlightenment; german: Aufklärung, "Enlightenment"; it, L'Illuminismo, "Enlightenment"; pl, Oświecenie, "Enlightenment"; pt, Iluminismo, "Enlightenment"; es, La Ilustración, "Enlightenment" was an intel ...
. Yet the largest jump in the divergence happened in the late 18th and 19th centuries with the
Industrial Revolution The Industrial Revolution was the transition to new manufacturing processes in Great Britain, continental Europe, and the United States, that occurred during the period from around 1760 to about 1820–1840. This transition included going f ...
and
Technological Revolution A technological revolution is a period in which one or more technologies is replaced by another novel technology in a short amount of time. It is an era of accelerated technological progress characterized by new innovations whose rapid applic ...
. For this reason, the "California school" considers only this to be the ''great'' divergence. Technological advances, in areas such as
transportation Transport (in British English), or transportation (in American English), is the intentional movement of humans, animals, and goods from one location to another. Modes of transport include air, land (rail and road), water, cable, pipeline, ...
,
mining Mining is the extraction of valuable minerals or other geological materials from the Earth, usually from an ore body, lode, vein, seam, reef, or placer deposit. The exploitation of these deposits for raw material is based on the economic v ...
, and
agriculture Agriculture or farming is the practice of cultivating plants and livestock. Agriculture was the key development in the rise of sedentary human civilization, whereby farming of domesticated species created food surpluses that enabled people t ...
, were embraced to a higher degree in the West than the East during the Great Divergence. Technology led to increased industrialization and economic complexity in the areas of agriculture, trade, fuel and resources, further separating the East and the West. Western Europe's use of
coal Coal is a combustible black or brownish-black sedimentary rock, formed as rock strata called coal seams. Coal is mostly carbon with variable amounts of other elements, chiefly hydrogen, sulfur, oxygen, and nitrogen. Coal is formed wh ...
as an energy substitute for wood in the mid-19th century gave it a major head start in modern energy production. In the twentieth century, the Great Divergence peaked before the
First World War World War I (28 July 1914 11 November 1918), often abbreviated as WWI, was List of wars and anthropogenic disasters by death toll, one of the deadliest global conflicts in history. Belligerents included much of Europe, the Russian Empire, ...
and continued until the early 1970s; then, after two decades of indeterminate fluctuations, in the late 1980s it was replaced by the Great Convergence as the majority of Third World countries reached economic growth rates significantly higher than those in most First World countries.


Terminology and definition

The term "Great Divergence" was coined by
Samuel P. Huntington Samuel Phillips Huntington (April 18, 1927December 24, 2008) was an American political scientist, adviser, and academic. He spent more than half a century at Harvard University, where he was director of Harvard's Center for International Affai ...
in 1996 and used by
Kenneth Pomeranz Kenneth Pomeranz, FBA (born November 4, 1958) is University Professor of History at the University of Chicago. He received his B.A. from Cornell University in 1980, where he was a Telluride Scholar, and his Ph.D. from Yale University in 1988, ...
in his book '' The Great Divergence: China, Europe, and the Making of the Modern World Economy'' (2000). The same phenomenon was discussed by Eric Jones, whose 1981 book '' The European Miracle: Environments, Economies and Geopolitics in the History of Europe and Asia'' popularized the alternate term "European Miracle". Broadly, both terms signify a
socioeconomic Socioeconomics (also known as social economics) is the social science that studies how economic activity affects and is shaped by social processes. In general it analyzes how modern societies progress, stagnate, or regress because of their loca ...
shift in which European countries advanced ahead of others during the modern period. The timing of the Great Divergence is in dispute among historians. The traditional dating is as early as the 16th (or even 15th) century, with scholars arguing that Europe had been on a trajectory of higher growth since that date. Pomeranz and others of the California school argue that the period of most rapid divergence was during the 19th century. Citing nutrition data and chronic European trade deficits as evidence, these scholars argue that before that date the most developed parts of
Asia Asia (, ) is one of the world's most notable geographical regions, which is either considered a continent in its own right or a subcontinent of Eurasia, which shares the continental landmass of Afro-Eurasia with Africa. Asia covers an area ...
had comparable economic development to Europe, especially
Qing China The Qing dynasty ( ), officially the Great Qing,, was a Manchu-led imperial dynasty of China and the last orthodox dynasty in Chinese history. It emerged from the Later Jin dynasty founded by the Jianzhou Jurchens, a Tungusic-speak ...
in the Yangzi Delta and
South Asia South Asia is the southern subregion of Asia, which is defined in both geographical and ethno-cultural terms. The region consists of the countries of Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka. ...
in the
Bengal Subah The Bengal Subah ( bn, সুবাহ বাংলা; fa, ), also referred to as Mughal Bengal ( bn, মোগল বাংলা), was the largest subdivision of the Mughal Empire (and later an independent state under the Nawabs of Be ...
.
Robert C. Allen Robert Carson Allen (born 10 January 1947 in Salem, Massachusetts) is Professor of Economic History at New York University Abu Dhabi. His research interests are economic history, technological change and public policy and he has written extensivel ...
, Tommy Bengtsson, Martin Dribe (2005)
''Living Standards in the Past: New Perspectives on Well-Being in Asia and Europe'', page 173-188
Oxford University Press Oxford University Press (OUP) is the university press of the University of Oxford. It is the largest university press in the world, and its printing history dates back to the 1480s. Having been officially granted the legal right to print books ...
Some argue that the cultural factors behind the divergence can be traced to earlier periods and institutions such as the
Renaissance The Renaissance ( , ) , from , with the same meanings. is a period in European history marking the transition from the Middle Ages to modernity and covering the 15th and 16th centuries, characterized by an effort to revive and surpass ide ...
and the Chinese
imperial examination The imperial examination (; lit. "subject recommendation") refers to a civil-service examination system in Imperial China, administered for the purpose of selecting candidates for the state bureaucracy. The concept of choosing bureaucrats by ...
system. Broadberry asserts that even the richest areas of Asia were behind Western Europe as early as the 16th century. He cites statistics comparing England to the Yangzi Delta (the most developed part of China by a good margin) showing that by 1600 the former had three times the latter's average wages when measured in silver, 15% greater wages when measured in wheat equivalent (the latter being used as a proxy for buying power of basic subsistence goods and the former as a proxy for buying power of craft goods, especially traded ones), and higher urbanization. England's silver wages were also five times higher than those of India in the late 16th century, with relatively higher grain wages reflecting an abundance of grain, and low silver wages reflecting low levels of overall development. Grain wages started to diverge more sharply from the early 18th century, with English wages being two and a half times higher than India or China's in wheat equivalent while remaining about five times higher in silver at that time.


Conditions in pre–Great Divergence cores

Unlike modern industrial economies, pre-modern economies were constrained by conditions which greatly limited economic growth. Although core regions in Eurasia had achieved a relatively high standard of living by the 18th century, shortages of land,
soil degradation Soil retrogression and degradation are two regressive evolution processes associated with the loss of equilibrium of a stable soil. Retrogression is primarily due to soil erosion and corresponds to a phenomenon where succession reverts the land ...
, deforestation, lack of dependable energy sources, and other ecological constraints limited growth in per capita incomes. Rapid rates of depreciation on capital meant that a great part of savings in pre-modern economies were spent on replacing depleted capital, hampering
capital accumulation Capital accumulation is the dynamic that motivates the pursuit of profit, involving the investment of money or any financial asset with the goal of increasing the initial monetary value of said asset as a financial return whether in the fo ...
. Massive windfalls of fuel, land, food and other resources were necessary for continued growth and capital accumulation, leading to
colonialism Colonialism is a practice or policy of control by one people or power over other people or areas, often by establishing colonies and generally with the aim of economic dominance. In the process of colonisation, colonisers may impose their relig ...
. The Industrial Revolution overcame these restraints, allowing rapid, sustained growth in per capita incomes for the first time in human history.


Western Europe

After the
Viking Vikings ; non, víkingr is the modern name given to seafaring people originally from Scandinavia (present-day Denmark, Norway and Sweden), who from the late 8th to the late 11th centuries raided, pirated, traded and se ...
,
Muslim Muslims ( ar, المسلمون, , ) are people who adhere to Islam, a monotheistic religion belonging to the Abrahamic tradition. They consider the Quran, the foundational religious text of Islam, to be the verbatim word of the God of Abraha ...
, and Magyar invasions waned in the 10th century, Europe entered a period of prosperity, population growth and territorial expansion known as the
High Middle Ages The High Middle Ages, or High Medieval Period, was the period of European history that lasted from AD 1000 to 1300. The High Middle Ages were preceded by the Early Middle Ages and were followed by the Late Middle Ages, which ended around AD ...
. Trade and commerce revived, with increased specialization between areas and between the countryside and artisans in towns. By the 13th century the best land had been occupied and agricultural income began to fall, though trade and commerce continued to expand, especially in
Venice Venice ( ; it, Venezia ; vec, Venesia or ) is a city in northeastern Italy and the capital of the Veneto region. It is built on a group of 118 small islands that are separated by canals and linked by over 400 bridges. The isl ...
and other northern Italian cities. The 14th century brought a series of calamities: famines, wars, the
Black Death The Black Death (also known as the Pestilence, the Great Mortality or the Plague) was a bubonic plague pandemic occurring in Western Eurasia and North Africa from 1346 to 1353. It is the most fatal pandemic recorded in human history, cau ...
and other epidemics. The resulting drop in the population led to falling rents and rising wages, undermining the
feudal Feudalism, also known as the feudal system, was the combination of the legal, economic, military, cultural and political customs that flourished in medieval Europe between the 9th and 15th centuries. Broadly defined, it was a way of structur ...
and
manorial Manorialism, also known as the manor system or manorial system, was the method of land ownership (or "tenure") in parts of Europe, notably France and later England, during the Middle Ages. Its defining features included a large, sometimes forti ...
relationships that had characterized Medieval Europe. According to a 2014 study, "there was a 'little divergence' within Europe between 1300 and 1800: real
wage A wage is payment made by an employer to an employee for work done in a specific period of time. Some examples of wage payments include compensatory payments such as ''minimum wage'', ''prevailing wage'', and ''yearly bonuses,'' and remun ...
s in the
North Sea Region The North Sea Region (NSR) of Europe refers to European countries and regions that have access to the North Sea. Cultural and economic co-operation has a strong tradition in the area, dating back to the VikingsGermany Germany,, officially the Federal Republic of Germany, is a country in Central Europe. It is the second most populous country in Europe after Russia, and the most populous member state of the European Union. Germany is situated betwee ...
,
Italy Italy ( it, Italia ), officially the Italian Republic, ) or the Republic of Italy, is a country in Southern Europe. It is located in the middle of the Mediterranean Sea, and its territory largely coincides with the homonymous geographical ...
, and
Spain , image_flag = Bandera de España.svg , image_coat = Escudo de España (mazonado).svg , national_motto = '' Plus ultra'' (Latin)(English: "Further Beyond") , national_anthem = (English: "Royal March") , ...
) began to fall after the fifteenth century and returned to some kind of subsistence minimum during the 1500–1800 period. This 'little divergence' in real wages mirrors a similar divergence in
GDP per capita Lists of countries by GDP per capita list the countries in the world by their gross domestic product (GDP) per capita. The lists may be based on nominal or purchasing power parity GDP. Gross national income (GNI) per capita accounts for inflow ...
: in the 'periphery' of Europe there was almost no per capita growth (or even a decline) between 1500 and 1800, whereas in
Holland Holland is a geographical regionG. Geerts & H. Heestermans, 1981, ''Groot Woordenboek der Nederlandse Taal. Deel I'', Van Dale Lexicografie, Utrecht, p 1105 and former province on the western coast of the Netherlands. From the 10th to the 16th ...
and
England England is a Countries of the United Kingdom, country that is part of the United Kingdom. It shares land borders with Wales to its west and Scotland to its north. The Irish Sea lies northwest and the Celtic Sea to the southwest. It is separa ...
real income continued to rise and more or less doubled in this period". In the
Age of Discovery The Age of Discovery (or the Age of Exploration), also known as the early modern period, was a period largely overlapping with the Age of Sail, approximately from the 15th century to the 17th century in European history, during which seafarin ...
, navigators discovered new routes to the
Americas The Americas, which are sometimes collectively called America, are a landmass comprising the totality of North and South America. The Americas make up most of the land in Earth's Western Hemisphere and comprise the New World. Along with t ...
and
Asia Asia (, ) is one of the world's most notable geographical regions, which is either considered a continent in its own right or a subcontinent of Eurasia, which shares the continental landmass of Afro-Eurasia with Africa. Asia covers an area ...
.
Commerce Commerce is the large-scale organized system of activities, functions, procedures and institutions directly and indirectly related to the exchange (buying and selling) of goods and services among two or more parties within local, regional, nation ...
expanded, together with innovations such as
joint stock companies A joint-stock company is a business entity in which shares of the company's stock can be bought and sold by shareholders. Each shareholder owns company stock in proportion, evidenced by their shares (certificates of ownership). Shareholders are ...
and various financial institutions. New military technologies favored larger units, leading to a concentration of power in states whose finances relied on trade. The
Dutch Republic The United Provinces of the Netherlands, also known as the (Seven) United Provinces, officially as the Republic of the Seven United Netherlands ( Dutch: ''Republiek der Zeven Verenigde Nederlanden''), and commonly referred to in historiography ...
was controlled by merchants, while
Parliament In modern politics, and history, a parliament is a legislative body of government. Generally, a modern parliament has three functions: representing the electorate, making laws, and overseeing the government via hearings and inquiries. ...
gained control of the
Kingdom of England The Kingdom of England (, ) was a sovereign state on the island of Great Britain from 12 July 927, when it emerged from various Anglo-Saxon kingdoms, until 1 May 1707, when it united with Scotland to form the Kingdom of Great Britain. On ...
after a long struggle culminating in the
Glorious Revolution The Glorious Revolution; gd, Rèabhlaid Ghlòrmhor; cy, Chwyldro Gogoneddus , also known as the ''Glorieuze Overtocht'' or ''Glorious Crossing'' in the Netherlands, is the sequence of events leading to the deposition of King James II and ...
. These arrangements proved more hospitable to economic development. At the end of the 16th century,
London London is the capital and List of urban areas in the United Kingdom, largest city of England and the United Kingdom, with a population of just under 9 million. It stands on the River Thames in south-east England at the head of a estuary dow ...
and
Antwerp Antwerp (; nl, Antwerpen ; french: Anvers ; es, Amberes) is the largest city in Belgium by area at and the capital of Antwerp Province in the Flemish Region. With a population of 520,504,
began pulling away from other European cities, as illustrated in the following graph of real wages in several European cities: According to a 2021 review of existing evidence by
Jack Goldstone Jack A. Goldstone (born September 30, 1953) is an American sociologist, political scientist, and historian, specializing in studies of social movements, revolutions, political demography, and the 'Rise of the West' in world history. He is an ...
, the Great Divergence only arose after 1750 (or even 1800) in northwestern Europe. Prior to that, economic growth rates in northwestern Europe were neither sustained nor remarkable, and income per capita was similar to "peak levels achieved hundreds of years earlier in the most developed regions of Italy and China." The West had a series of unique advantages compared to Asia, such as the proximity of coal mines; the discovery of the
New World The term ''New World'' is often used to mean the majority of Earth's Western Hemisphere, specifically the Americas."America." ''The Oxford Companion to the English Language'' (). McArthur, Tom, ed., 1992. New York: Oxford University Press, p. 3 ...
, which alleviated ecological restraints on economic growth (land shortages etc.); and the profits from colonization.


China

China had a larger population than Europe throughout the last two millennia. Unlike Europe, it was politically united for long periods during that time. During the
Song dynasty The Song dynasty (; ; 960–1279) was an imperial dynasty of China that began in 960 and lasted until 1279. The dynasty was founded by Emperor Taizu of Song following his usurpation of the throne of the Later Zhou. The Song conquered the rest ...
(960–1279), the country experienced a revolution in agriculture, water transport, finance, urbanization, science and technology, which made the Chinese economy the most advanced in the world from about 1100. Mastery of wet-field rice cultivation opened up the hitherto underdeveloped south of the country, while later northern China was devastated by Jurchen and
Mongol The Mongols ( mn, Монголчууд, , , ; ; russian: Монголы) are an East Asian people, East Asian ethnic group indigenous peoples, native to Mongolia, Inner Mongolia in China and the Buryatia, Buryatia Republic of the Russia, Russ ...
invasions, floods and epidemics. The result was a dramatic shift in the center of population and industry from the home of Chinese civilization around the
Yellow River The Yellow River or Huang He (Chinese: , Mandarin: ''Huáng hé'' ) is the second-longest river in China, after the Yangtze River, and the sixth-longest river system in the world at the estimated length of . Originating in the Bayan Ha ...
to the south of the country, a trend only partially reversed by the re-population of the north from the 15th century. By 1300, China as a whole had fallen behind Italy in living standards and by 1400, England had also caught up with it but its wealthiest regions, especially the Yangzi Delta, may have remained on par with those of Europe until the early 18th century. In the late imperial period (1368–1911), comprising the
Ming The Ming dynasty (), officially the Great Ming, was an imperial dynasty of China, ruling from 1368 to 1644 following the collapse of the Mongol-led Yuan dynasty. The Ming dynasty was the last orthodox dynasty of China ruled by the Han peop ...
and
Qing The Qing dynasty ( ), officially the Great Qing,, was a Manchu-led imperial dynasty of China and the last orthodox dynasty in Chinese history. It emerged from the Later Jin dynasty founded by the Jianzhou Jurchens, a Tungusic-speak ...
dynasties,
taxation A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity) by a governmental organization in order to fund government spending and various public expenditures (regional, local, o ...
was low, and the economy and population grew significantly, though without substantial increases in productivity. Chinese goods such as
silk Silk is a natural protein fiber, some forms of which can be woven into textiles. The protein fiber of silk is composed mainly of fibroin and is produced by certain insect larvae to form cocoons. The best-known silk is obtained from t ...
,
tea Tea is an aromatic beverage prepared by pouring hot or boiling water over cured or fresh leaves of '' Camellia sinensis'', an evergreen shrub native to East Asia which probably originated in the borderlands of southwestern China and north ...
and
ceramics A ceramic is any of the various hard, brittle, heat-resistant and corrosion-resistant materials made by shaping and then firing an inorganic, nonmetallic material, such as clay, at a high temperature. Common examples are earthenware, porcelain, ...
were in great demand in Europe, leading to an inflow of silver, expanding the money supply and facilitating the growth of competitive and stable markets. By the end of the 18th century, population density levels exceeded those in Europe. China had more large cities but far fewer small ones than in contemporary Europe. Kenneth Pomeranz originally claimed that Great Divergence did not begin until the 19th century. Later he revisited his position and now sees the date between 1700 and 1750.


India

According to a 2020 study and dataset, the Great Divergence between
northern India North India is a loosely defined region consisting of the northern part of India. The dominant geographical features of North India are the Indo-Gangetic Plain and the Himalayas, which demarcate the region from the Tibetan Plateau and Central ...
(from
Gujarat Gujarat (, ) is a state along the western coast of India. Its coastline of about is the longest in the country, most of which lies on the Kathiawar peninsula. Gujarat is the fifth-largest Indian state by area, covering some ; and the ninth- ...
to
Bengal Bengal ( ; bn, বাংলা/বঙ্গ, translit=Bānglā/Bôngô, ) is a geopolitical, cultural and historical region in South Asia, specifically in the eastern part of the Indian subcontinent at the apex of the Bay of Bengal, predo ...
) and Britain began in the late 17th century. It widened after the 1720s and exploded after the 1800s. The study found that it was "primarily England's spurt and India's stagnation in the first half of the nineteenth century that brought about most serious differences in the standard of living." By the 1500s,
India India, officially the Republic of India ( Hindi: ), is a country in South Asia. It is the seventh-largest country by area, the second-most populous country, and the most populous democracy in the world. Bounded by the Indian Ocean on the ...
, especially the
Bengal Sultanate The Sultanate of Bengal ( Middle Bengali: শাহী বাঙ্গালা ''Shahī Baṅgala'', Classical Persian: ''Saltanat-e-Bangālah'') was an empire based in Bengal for much of the 14th, 15th and 16th centuries. It was the dominan ...
, a major trading nation in the world, benefited from extensive external and internal trade. Its agriculture was highly efficient as well as its industry. Unlike China, Japan and western and central Europe, India did not experience extensive
deforestation Deforestation or forest clearance is the removal of a forest or stand of trees from land that is then converted to non-forest use. Deforestation can involve conversion of forest land to farms, ranches, or urban use. The most concentrated ...
until the 19th and 20th centuries. It thus had no pressure to move to coal as a source of energy. From the 17th century,
cotton Cotton is a soft, fluffy staple fiber that grows in a boll, or protective case, around the seeds of the cotton plants of the genus ''Gossypium'' in the mallow family Malvaceae. The fiber is almost pure cellulose, and can contain minor pe ...
textile Textile is an umbrella term that includes various fiber-based materials, including fibers, yarns, filaments, threads, different fabric types, etc. At first, the word "textiles" only referred to woven fabrics. However, weaving is not t ...
s from
Mughal India The Mughal Empire was an early-modern empire that controlled much of South Asia between the 16th and 19th centuries. Quote: "Although the first two Timurid emperors and many of their noblemen were recent migrants to the subcontinent, the ...
became popular in Europe, with some governments banning them to protect their wool industries.
Mughal Bengal The Bengal Subah ( bn, সুবাহ বাংলা; fa, ), also referred to as Mughal Bengal ( bn, মোগল বাংলা), was the largest subdivision of the Mughal Empire (and later an independent state under the Nawabs of Be ...
, the most developed region, in particular, was globally prominent in industries such as
textile manufacturing Textile Manufacturing or Textile Engineering is a major industry. It is largely based on the conversion of fibre into yarn, then yarn into fabric. These are then dyed or printed, fabricated into cloth which is then converted into useful good ...
and
shipbuilding Shipbuilding is the construction of ships and other floating vessels. It normally takes place in a specialized facility known as a shipyard. Shipbuilders, also called shipwrights, follow a specialized occupation that traces its roots to befo ...
. In
early modern Europe Early modern Europe, also referred to as the post-medieval period, is the period of European history between the end of the Middle Ages and the beginning of the Industrial Revolution, roughly the late 15th century to the late 18th century. Histo ...
, there was significant demand for products from
Mughal India The Mughal Empire was an early-modern empire that controlled much of South Asia between the 16th and 19th centuries. Quote: "Although the first two Timurid emperors and many of their noblemen were recent migrants to the subcontinent, the ...
, particularly cotton textiles, as well as goods such as
spice A spice is a seed, fruit, root, bark, or other plant substance primarily used for flavoring or coloring food. Spices are distinguished from herbs, which are the leaves, flowers, or stems of plants used for flavoring or as a garnish. Spic ...
s,
pepper Pepper or peppers may refer to: Food and spice * Piperaceae or the pepper family, a large family of flowering plant ** Black pepper * ''Capsicum'' or pepper, a genus of flowering plants in the nightshade family Solanaceae ** Bell pepper ** Chili ...
s,
indigo Indigo is a deep color close to the color wheel blue (a primary color in the RGB color space), as well as to some variants of ultramarine, based on the ancient dye of the same name. The word "indigo" comes from the Latin word ''indicum'', m ...
,
silk Silk is a natural protein fiber, some forms of which can be woven into textiles. The protein fiber of silk is composed mainly of fibroin and is produced by certain insect larvae to form cocoons. The best-known silk is obtained from t ...
s, and
saltpeter Potassium nitrate is a chemical compound with the chemical formula . This alkali metal nitrate salt is also known as Indian saltpetre (large deposits of which were historically mined in India). It is an ionic salt of potassium ions K+ and ...
(for use in
munitions Ammunition (informally ammo) is the material fired, scattered, dropped, or detonated from any weapon or weapon system. Ammunition is both expendable weapons (e.g., bombs, missiles, grenades, land mines) and the component parts of other weap ...
). European fashion, for example, became increasingly dependent on Indian textiles and silks. In the 17th and 18th centuries, India accounted for 95% of British imports from
Asia Asia (, ) is one of the world's most notable geographical regions, which is either considered a continent in its own right or a subcontinent of Eurasia, which shares the continental landmass of Afro-Eurasia with Africa. Asia covers an area ...
, and the
Bengal Subah The Bengal Subah ( bn, সুবাহ বাংলা; fa, ), also referred to as Mughal Bengal ( bn, মোগল বাংলা), was the largest subdivision of the Mughal Empire (and later an independent state under the Nawabs of Be ...
alone accounted for 40% of Dutch imports from Asia. Amiya Kumar Bagchi estimates 10.3% of Bihar's populace were involved in hand spinning thread, 2.3% weaving, and 9% in other manufacturing trades, in 1809–13, to satisfy this demand. In contrast, there was very little demand for European goods in India, which was largely self-sufficient, thus Europeans had very little to offer, except for some
woolen Woolen (American English) or woollen (Commonwealth English) is a type of yarn made from carded wool. Woolen yarn is soft, light, stretchy, and full of air. It is thus a good insulator, and makes a good knitting yarn. Woolen yarn is in contrast ...
textiles, unprocessed
metal A metal (from Greek μέταλλον ''métallon'', "mine, quarry, metal") is a material that, when freshly prepared, polished, or fractured, shows a lustrous appearance, and conducts electricity and heat relatively well. Metals are typica ...
s and a few luxury items. The trade imbalance caused Europeans to export large quantities of gold and silver to India in order to pay for Indian imports.


Middle East

The
Middle East The Middle East ( ar, الشرق الأوسط, ISO 233: ) is a geopolitical region commonly encompassing Arabia (including the Arabian Peninsula and Bahrain), Asia Minor (Asian part of Turkey except Hatay Province), East Thrace (Europ ...
was more advanced than Western Europe in 1000, on par by the middle of the 16th century, but by 1750, leading Middle Eastern states had fallen behind the leading Western European states of Britain and the Netherlands. An example of a Middle Eastern country that had an advanced economy in the early 19th century was
Ottoman Egypt The Eyalet of Egypt (, ) operated as an administrative division of the Ottoman Empire from 1517 to 1867. It originated as a result of the conquest of Mamluk Egypt by the Ottomans in 1517, following the Ottoman–Mamluk War (1516–17) and the ...
, which had a highly productive industrial
manufacturing Manufacturing is the creation or production of goods with the help of equipment, labor, machines, tools, and chemical or biological processing or formulation. It is the essence of secondary sector of the economy. The term may refer t ...
sector, and per-capita income that was comparable to leading Western European countries such as
France France (), officially the French Republic ( ), is a country primarily located in Western Europe. It also comprises of Overseas France, overseas regions and territories in the Americas and the Atlantic Ocean, Atlantic, Pacific Ocean, Pac ...
and higher than that of
Japan Japan ( ja, 日本, or , and formally , ''Nihonkoku'') is an island country in East Asia. It is situated in the northwest Pacific Ocean, and is bordered on the west by the Sea of Japan, while extending from the Sea of Okhotsk in the north ...
and
Eastern Europe Eastern Europe is a subregion of the European continent. As a largely ambiguous term, it has a wide range of geopolitical, geographical, ethnic, cultural, and socio-economic connotations. The vast majority of the region is covered by Russia, wh ...
. Other parts of the
Ottoman Empire The Ottoman Empire, * ; is an archaic version. The definite article forms and were synonymous * and el, Оθωμανική Αυτοκρατορία, Othōmanikē Avtokratoria, label=none * info page on book at Martin Luther University) ...
, particularly
Syria Syria ( ar, سُورِيَا or سُورِيَة, translit=Sūriyā), officially the Syrian Arab Republic ( ar, الجمهورية العربية السورية, al-Jumhūrīyah al-ʻArabīyah as-Sūrīyah), is a Western Asian country loc ...
and southeastern
Anatolia Anatolia, tr, Anadolu Yarımadası), and the Anatolian plateau, also known as Asia Minor, is a large peninsula in Western Asia and the westernmost protrusion of the Asian continent. It constitutes the major part of modern-day Turkey. The re ...
, also had a highly productive manufacturing sector that was evolving in the 19th century. In 1819,
Egypt under Muhammad Ali The history of Egypt under the Muhammad Ali dynasty (1805–1953) spanned the later period of Ottoman Egypt, the Khedivate of Egypt under British occupation, and the nominally independent Sultanate of Egypt and Kingdom of Egypt, ending with the ...
began programs of state-sponsored
industrialization Industrialisation ( alternatively spelled industrialization) is the period of social and economic change that transforms a human group from an agrarian society into an industrial society. This involves an extensive re-organisation of an econom ...
, which included setting up factories for weapons production, an
iron Iron () is a chemical element with symbol Fe (from la, ferrum) and atomic number 26. It is a metal that belongs to the first transition series and group 8 of the periodic table. It is, by mass, the most common element on Earth, right in fro ...
foundry A foundry is a factory that produces metal castings. Metals are cast into shapes by melting them into a liquid, pouring the metal into a mold, and removing the mold material after the metal has solidified as it cools. The most common metals p ...
, large-scale cotton cultivation, mills for
ginning A cotton gin—meaning "cotton engine"—is a machine that quickly and easily separates cotton fibers from their seeds, enabling much greater productivity than manual cotton separation.. Reprinted by McGraw-Hill, New York and London, 1926 (); a ...
,
spinning Spin or spinning most often refers to: * Spinning (textiles), the creation of yarn or thread by twisting fibers together, traditionally by hand spinning * Spin, the rotation of an object around a central axis * Spin (propaganda), an intentional ...
and
weaving Weaving is a method of textile production in which two distinct sets of yarns or threads are interlaced at right angles to form a fabric or cloth. Other methods are knitting, crocheting, felting, and braiding or plaiting. The longitudinal th ...
of cotton, and enterprises for agricultural processing. By the early 1830s, Egypt had 30
cotton mill A cotton mill is a building that houses spinning or weaving machinery for the production of yarn or cloth from cotton, an important product during the Industrial Revolution in the development of the factory system. Although some were dri ...
s, employing about 30,000 workers. In the early 19th century, Egypt had the world's fifth most productive cotton industry, in terms of the number of spindles per capita. The industry was initially driven by machinery that relied on traditional energy sources, such as animal power,
water wheel A water wheel is a machine for converting the energy of flowing or falling water into useful forms of power, often in a watermill. A water wheel consists of a wheel (usually constructed from wood or metal), with a number of blades or bucke ...
s, and
windmill A windmill is a structure that converts wind power into rotational energy using vanes called sails or blades, specifically to mill grain ( gristmills), but the term is also extended to windpumps, wind turbines, and other applications, in s ...
s, which were also the principle energy sources in Western Europe up until around 1870. While
steam power A steam engine is a heat engine that performs mechanical work using steam as its working fluid. The steam engine uses the force produced by steam pressure to push a piston back and forth inside a cylinder. This pushing force can be tr ...
had been experimented with in Ottoman Egypt by engineer Taqi ad-Din Muhammad ibn Ma'ruf in 1551, when he invented a steam jack driven by a rudimentary
steam turbine A steam turbine is a machine that extracts thermal energy from pressurized steam and uses it to do mechanical work on a rotating output shaft. Its modern manifestation was invented by Charles Parsons in 1884. Fabrication of a modern steam tur ...
, it was under
Muhammad Ali of Egypt Muhammad Ali Pasha al-Mas'ud ibn Agha, also known as Muhammad Ali of Egypt and the Sudan ( sq, Mehmet Ali Pasha, ar, محمد علي باشا, ; ota, محمد علی پاشا المسعود بن آغا; ; 4 March 1769 – 2 August 1849), was ...
in the early 19th century that
steam engine A steam engine is a heat engine that performs mechanical work using steam as its working fluid. The steam engine uses the force produced by steam pressure to push a piston back and forth inside a cylinder. This pushing force can be tr ...
s were introduced to Egyptian industrial manufacturing.
Boiler A boiler is a closed vessel in which fluid (generally water) is heated. The fluid does not necessarily boil. The heated or vaporized fluid exits the boiler for use in various processes or heating applications, including water heating, central ...
s were manufactured and installed in Egyptian industries such as
ironworks An ironworks or iron works is an industrial plant where iron is smelted and where heavy iron and steel products are made. The term is both singular and plural, i.e. the singular of ''ironworks'' is ''ironworks''. Ironworks succeeded bloo ...
, textile manufacturing,
paper mill A paper mill is a factory devoted to making paper from vegetable fibres such as wood pulp, old rags, and other ingredients. Prior to the invention and adoption of the Fourdrinier machine and other types of paper machine that use an endless be ...
s, and hulling mills. Compared to Western Europe, Egypt also had superior agriculture and an efficient transport network through the
Nile The Nile, , Bohairic , lg, Kiira , Nobiin: Áman Dawū is a major north-flowing river in northeastern Africa. It flows into the Mediterranean Sea. The Nile is the longest river in Africa and has historically been considered the longest ...
. Economic historian Jean Batou argues that the necessary economic conditions for rapid industrialization existed in Egypt during the 1820s–1830s. After the death of
Muhammad Ali Muhammad Ali (; born Cassius Marcellus Clay Jr.; January 17, 1942 – June 3, 2016) was an American professional boxer and activist. Nicknamed "The Greatest", he is regarded as one of the most significant sports figures of the 20th century, a ...
in 1849, his industrialization programs fell into decline, after which, according to historian Zachary Lockman, "Egypt was well on its way to full integration into a European-dominated world market as supplier of a single raw material, cotton." Lockman argues that, had Egypt succeeded in its industrialization programs, "it might have shared with Japan r the United Statesthe distinction of achieving autonomous capitalist development and preserving its independence."


Japan

Japanese society was governed by the
Tokugawa Shogunate The Tokugawa shogunate (, Japanese 徳川幕府 ''Tokugawa bakufu''), also known as the , was the military government of Japan during the Edo period from 1603 to 1868. Nussbaum, Louis-Frédéric. (2005)"''Tokugawa-jidai''"in ''Japan Encyclopedia' ...
, which divided Japanese society into a strict hierarchy and intervened considerably in the economy through state monopolies and restrictions on foreign trade; however, in practice, the Shogunate's rule was often circumvented. From 725 to 1974, Japan experienced GDP per capita growth at an annual rate of 0.04%, with major periods of positive per capita GDP growth occurring during 1150–1280, 1450–1600 and after 1730. There were no significant periods of sustained growth reversals. Relative to the United Kingdom, GDP per capita was at roughly similar levels until the middle of the 17th century. By 1850, per capita incomes in Japan were approximately a quarter of the British level. However, 18th-century Japan had a higher
life expectancy Life expectancy is a statistical measure of the average time an organism is expected to live, based on the year of its birth, current age, and other demographic factors like sex. The most commonly used measure is life expectancy at birth ...
, 41.1 years for adult males, compared with 31.6 to 34 for England, between 27.5 and 30 for France, and 24.7 for Prussia.


Korea

In its earlier days, Korea had healthy international trading relationships, receiving merchants from as far as the Middle East. Yet because of its strategic value to its neighboring countries, Korea had been invaded several times during its
Goryeo Goryeo (; ) was a Korean kingdom founded in 918, during a time of national division called the Later Three Kingdoms period, that unified and ruled the Korea, Korean Peninsula until 1392. Goryeo achieved what has been called a "true national un ...
and Joseon eras, starting with the
Mongol invasion The Mongol invasions and conquests took place during the 13th and 14th centuries, creating history's largest contiguous empire: the Mongol Empire ( 1206-1368), which by 1300 covered large parts of Eurasia. Historians regard the Mongol devastatio ...
in the 13th century. Though repelled due to its strong navy and aid from China, the Japanese invasions in the late 16th century were particularly devastating to the peninsula and it never truly recovered until the modern era. Due to relatively frequent invasions, increased Western colonization of Asia, and the arrival of
Christian missionaries A Christian mission is an organized effort for the propagation of the Christian faith. Missions involve sending individuals and groups across boundaries, most commonly geographical boundaries, to carry on evangelism or other activities, such a ...
, Korea began a long period of isolationism, maintaining diplomatic relationships primarily with China only. For the rest of the Joseon period, the country was marred by economic hardships, peasant revolts, and political factionalism until it was annexed by Japan in the early 20th century.


Sub-Saharan Africa

Pre-colonial sub-Saharan Africa was politically fragmented, just as early modern Europe was. Africa was home to numerous wealthy empires which grew around coastal areas or large rivers that served as part of important trade routes. Africa was however far more sparsely populated than Europe. According to University of Michigan political scientist Mark Dincecco, "the high land/ labor ratio may have made it less likely that historical institutional centralization at the "national level" would occur in sub-Saharan Africa, thwarting further state development." The transatlantic slave trade may have further weakened state power in Africa. A series of states developed in the
Sahel The Sahel (; ar, ساحل ' , "coast, shore") is a region in North Africa. It is defined as the ecoclimatic and biogeographic realm of transition between the Sahara to the north and the Sudanian savanna to the south. Having a hot semi-arid cli ...
on the southern edge of the Sahara which made immense profits from trading across the Sahara, trading heavily in gold and slaves for the
Trans-Saharan slave trade During the Trans-Saharan slave trade, slaves were transported across the Sahara desert. Most were moved from Sub-Saharan Africa to North Africa to be sold to Mediterranean and Middle eastern civilizations; a small percentage went the other di ...
. Kingdoms in the heavily forested regions of West Africa were also part of trade networks. The growth of trade in this area was driven by the Yoruba civilization, which was supported by cities surrounded by farmed land and made wealthy by extensive trade development.


East Africa

For most of the first millennium AD, the Axumite Kingdom in East Africa had a powerful navy and trading links reaching as far as the Byzantine Empire and India. Between the 14th and 17th centuries, the
Ajuran Sultanate The Ajuran Sultanate ( so, Saldanadda Ajuuraan, ar, سلطنة الأجورانية), also natively referred-to as Ajuuraan, and often simply Ajuran, was a Somali Empire in the Middle Ages in the Horn of Africa that dominated the trade in the ...
in modern-day Somalia practiced
hydraulic engineering Hydraulic engineering as a sub-discipline of civil engineering is concerned with the flow and conveyance of fluids, principally water and sewage. One feature of these systems is the extensive use of gravity as the motive force to cause the ...
and developed new systems for agriculture and taxation, which continued to be used in parts of the Horn of Africa as late as the 19th century. On the east coast of Africa, Swahili kingdoms had a prosperous trading empire. Swahili cities were important trading ports along the
Indian Ocean The Indian Ocean is the third-largest of the world's five oceanic divisions, covering or ~19.8% of the water on Earth's surface. It is bounded by Asia to the north, Africa to the west and Australia to the east. To the south it is bounded by ...
, engaging in trade with the Middle East and Far East. Kingdoms in southeast Africa also developed extensive trade links with other civilizations as far away as China and India. The institutional framework for long-distance trade across political and cultural boundaries had long been strengthened by the adoption of Islam as a cultural and moral foundation for trust among and with traders.


Possible factors

Scholars have proposed numerous theories to explain why the Great Divergence occurred.


Coal

In metallurgy and steam engines the
Industrial Revolution The Industrial Revolution was the transition to new manufacturing processes in Great Britain, continental Europe, and the United States, that occurred during the period from around 1760 to about 1820–1840. This transition included going f ...
made extensive use of coal and coke – as cheaper, more plentiful and more efficient than wood and
charcoal Charcoal is a lightweight black carbon residue produced by strongly heating wood (or other animal and plant materials) in minimal oxygen to remove all water and volatile constituents. In the traditional version of this pyrolysis process, ...
. Coal-fired steam engines also operated in the railways and in shipping, revolutionizing transport in the early 19th century. Kenneth Pomeranz drew attention to differences in the availability of coal between West and East. Due to regional climate, European coal mines were wetter, and deep mines did not become practical until the introduction of the
Newcomen steam engine The atmospheric engine was invented by Thomas Newcomen in 1712, and is often referred to as the Newcomen fire engine (see below) or simply as a Newcomen engine. The engine was operated by condensing steam drawn into the cylinder, thereby creati ...
to pump out groundwater. In mines in the arid northwest of China, ventilation to prevent explosions was much more difficult. Another difference involved geographic distance; although China and Europe had comparable mining technologies, the distances between the economically developed regions and coal deposits differed vastly. The largest coal deposits in China are located in the northwest, within reach of the Chinese industrial core during the
Northern Song Northern may refer to the following: Geography * North, a point in direction * Northern Europe, the northern part or region of Europe * Northern Highland, a region of Wisconsin, United States * Northern Province, Sri Lanka * Northern Range, a r ...
(960–1127). During the 11th century China developed sophisticated technologies to extract and use coal for energy, leading to soaring iron production. The southward population shift between the 12th and 14th centuries resulted in new centers of Chinese industry far from the major coal deposits. Some small coal deposits were available locally, though their use was sometimes hampered by government regulations. In contrast, Britain contained some of the largest coal deposits in Europe – all within a relatively compact island. The centrality of coal to Industrial revolution was criticized by Gregory Clark and David Jacks, who show that coal could be substituted without much loss of national income. Similarly Deirdre N. McCloskey says that coal could easily have been imported to Britain from other countries. Moreover, the Chinese could move their industries closer to coal reserves.


New World

A variety of theories posit Europe's unique relationship with the
New World The term ''New World'' is often used to mean the majority of Earth's Western Hemisphere, specifically the Americas."America." ''The Oxford Companion to the English Language'' (). McArthur, Tom, ed., 1992. New York: Oxford University Press, p. 3 ...
as a major cause of the Great Divergence. The high profits earned from the colonies and the slave trade constituted 7 percent a year, a relatively high rate of return considering the high rate of depreciation on pre-industrial capital stocks, which limited the amount of savings and capital accumulation. Early European colonization was sustained by profits through selling New World goods to Asia, especially silver to China. According to Pomeranz, the most important advantage for Europe was the vast amount of fertile, uncultivated land in the Americas which could be used to grow large quantities of farm products required to sustain European economic growth and allowed labor and land to be freed up in Europe for industrialization. New World exports of wood, cotton, and wool are estimated to have saved England the need for 23 to of cultivated land (by comparison, the total amount of cultivated land in England was just 17 million acres), freeing up immense amounts of resources. The New World also served as a market for European manufactures. Chen (2012) also suggested that the New World as a necessary factor for industrialization, and trade as a supporting factor causing less developed areas to concentrate on agriculture supporting industrialized regions in Europe.


Political fragmentation

Jared Diamond Jared Mason Diamond (born September 10, 1937) is an American geographer, historian, ornithologist, and author best known for his popular science books ''The Third Chimpanzee'' (1991); '' Guns, Germs, and Steel'' (1997, awarded a Pulitzer Prize); ...
and Peter Watson argue that a notable feature of Europe's geography was that it encouraged political
balkanization Balkanization is the fragmentation of a larger region or state into smaller regions or states, which may be hostile or uncooperative with one another. It is usually caused by differences of ethnicity, culture, and religion and some other factor ...
, such as having several large peninsulas and natural barriers such as mountains and straits that provided defensible borders. By contrast, China's geography encouraged political unity, with a much smoother
coastline The coast, also known as the coastline or seashore, is defined as the area where land meets the ocean, or as a line that forms the boundary between the land and the coastline. The Earth has around of coastline. Coasts are important zones in ...
and a heartland dominated by two river valleys (
Yellow Yellow is the color between green and orange on the spectrum of light. It is evoked by light with a dominant wavelength of roughly 575585 nm. It is a primary color in subtractive color systems, used in painting or color printing. In the ...
and
Yangtze The Yangtze or Yangzi ( or ; ) is the longest river in Asia, the third-longest in the world, and the longest in the world to flow entirely within one country. It rises at Jari Hill in the Tanggula Mountains (Tibetan Plateau) and flow ...
). In his book ''
Guns, Germs, and Steel ''Guns, Germs, and Steel: The Fates of Human Societies'' (subtitled ''A Short History of Everybody for the Last 13,000 Years'' in Britain) is a 1997 transdisciplinary non-fiction book by Jared Diamond. In 1998, it won the Pulitzer Prize for gen ...
'', Diamond argues that advanced cultures outside Europe had developed in areas whose
geography Geography (from Greek: , ''geographia''. Combination of Greek words ‘Geo’ (The Earth) and ‘Graphien’ (to describe), literally "earth description") is a field of science devoted to the study of the lands, features, inhabitants, an ...
was conducive to large, monolithic, isolated empires. In these conditions policies of technological and social stagnation could persist. He gives the example of China in 1432, when the
Xuande Emperor The Xuande Emperor (16 March 1399 31 January 1435), personal name Zhu Zhanji (朱瞻基), was the fifth Emperor of the Ming dynasty, reigned from 1425 to 1435. His era name " Xuande" means "proclamation of virtue". Ruling over a relatively ...
outlawed the building of ocean-going ships, in which China was the world leader at the time. On the other hand,
Christopher Columbus Christopher Columbus * lij, Cristoffa C(or)ombo * es, link=no, Cristóbal Colón * pt, Cristóvão Colombo * ca, Cristòfor (or ) * la, Christophorus Columbus. (; born between 25 August and 31 October 1451, died 20 May 1506) was a ...
obtained sponsorship from Queen Isabella I of Castile for his expedition even though three other European rulers turned it down. As a result, governments that suppressed economic and technological progress soon corrected their mistakes or were out-competed relatively quickly. He argues that these factors created the conditions for more rapid internal superpower change (Spain succeeded by France and then by the United Kingdom) than was possible elsewhere in Eurasia.
Justin Yifu Lin Justin Yifu Lin (; born on October 15, 1952) is a Chinese economist and professor of economics at Peking University. He served as the Chief Economist and Senior Vice President of the World Bank from 2008 to 2012. He has been appointed as China ...
argued that China's large population size proved beneficial in technological advancements prior to the 14th century, but that the large population size was not an important factor in the kind of technological advancements that resulted in the Industrial Revolution. Early technological advancements depended on "learning by doing" (where population size was an important factor, as advances could spread over a large political unit), whereas the Industrial Revolution was the result of experimentation and theory (where population size is less important). Economic historian Joel Mokyr has argued that political fragmentation (the presence of a large number of European states) made it possible for heterodox ideas to thrive, as entrepreneurs, innovators, ideologues and heretics could easily flee to a neighboring state in the event that the one state would try to suppress their ideas and activities. This is what set Europe apart from the technologically advanced, large unitary empires such as China. China had both a printing press and movable type, yet the industrial revolution would occur in Europe. In Europe, political fragmentation was coupled with an "integrated market for ideas" where Europe's intellectuals used the lingua franca of Latin, had a shared intellectual basis in Europe's classical heritage and the pan-European institution of the
Republic of Letters The Republic of Letters (''Respublica literaria'') is the long-distance intellectual community in the late 17th and 18th centuries in Europe and the Americas. It fostered communication among the intellectuals of the Age of Enlightenment, or '' phi ...
. The historian
Niall Ferguson Niall Campbell Ferguson FRSE (; born 18 April 1964)Biography
Niall Ferguson
attributes this divergence to the West's development of six "killer apps", which he finds were largely missing elsewhere in the world in 1500 – "competition, the scientific method, the rule of law, modern medicine, consumerism and the work ethic". Economic historian Tuan-Hwee Sng has argued that the large size of the Chinese state contributed to its relative decline in the 19th century:
The vast size of the Chinese empire created a severe
principal–agent problem The principal–agent problem refers to the conflict in interests and priorities that arises when one person or entity (the " agent") takes actions on behalf of another person or entity (the " principal"). The problem worsens when there is a gr ...
and constrained how the country was governed. In particular, taxes had to be kept low due to the emperor's weak oversight of his agents and the need to keep corruption in check. The Chinese state's fiscal weaknesses were long masked by its huge tax base. However, economic and demographic expansion in the eighteenth century exacerbated the problems of administrative control. This put a further squeeze on the nation's finances and left China ill-prepared for the challenges of the nineteenth century.
One reason why Japan was able to modernize and adopt the technologies of the West was due to its much smaller size relative to China. Stanford political scientist Gary W. Cox argues in a 2017 study,
that Europe's political fragmentation interacted with her institutional innovations to foster substantial areas of "economic liberty," where European merchants could organize production freer of central regulation, faced fewer central restrictions on their shipping and pricing decisions, and paid lower tariffs and tolls than their counterparts elsewhere in Eurasia. When fragmentation afforded merchants multiple politically independent routes on which to ship their goods, European rulers refrained from imposing onerous regulations and levying arbitrary tolls, lest they lose mercantile traffic to competing realms. Fragmented control of trade routes magnified the spillover effects of political reforms. If parliament curbed arbitrary regulations and tolls in one realm, then neighboring rulers might have to respond in kind, even if they themselves remained without a parliament. Greater economic liberty, fostered by the interaction of fragmentation and reform, unleashed faster and more inter-connected urban growth.


Other geographic factors

Fernand Braudel Fernand Braudel (; 24 August 1902 – 27 November 1985) was a French historian and leader of the Annales School. His scholarship focused on three main projects: ''The Mediterranean'' (1923–49, then 1949–66), ''Civilization and Capitalism'' ...
of the Annales school of historians argued that the
Mediterranean Sea The Mediterranean Sea is a sea connected to the Atlantic Ocean, surrounded by the Mediterranean Basin and almost completely enclosed by land: on the north by Western and Southern Europe and Anatolia, on the south by North Africa, and on ...
was poor for fishing due to its depth, therefore encouraging long-distance trade. Furthermore, the
Alps The Alps () ; german: Alpen ; it, Alpi ; rm, Alps ; sl, Alpe . are the highest and most extensive mountain range system that lies entirely in Europe, stretching approximately across seven Alpine countries (from west to east): France, Swi ...
and other parts of the
Alpide belt The Alpide belt or Alpine-Himalayan orogenic belt,K.M. Storetvedt, K. M., ''The Tethys Sea and the Alpine-Himalayan orogenic belt; mega-elements in a new global tectonic system,'' Physics of the Earth and Planetary Interiors, Volume 62, Issues 1 ...
supplied the coastal regions with fresh migrants from the uplands. This helped the spread of ideas, as did the east–west axis of the Mediterranean which lined up with the
prevailing winds In meteorology, prevailing wind in a region of the Earth's surface is a surface wind that blows predominantly from a particular direction. The dominant winds are the trends in direction of wind with the highest speed over a particular point on ...
and its many
archipelago An archipelago ( ), sometimes called an island group or island chain, is a chain, cluster, or collection of islands, or sometimes a sea containing a small number of scattered islands. Examples of archipelagos include: the Indonesian Arch ...
s which together aided navigation, as was also done by the great rivers which brought inland access, all of which further increased immigration. The
peninsula A peninsula (; ) is a landform that extends from a mainland and is surrounded by water on most, but not all of its borders. A peninsula is also sometimes defined as a piece of land bordered by water on three of its sides. Peninsulas exist on all ...
s of the Mediterranean also promoted political
nationalism Nationalism is an idea and movement that holds that the nation should be congruent with the state. As a movement, nationalism tends to promote the interests of a particular nation (as in a group of people), Smith, Anthony. ''Nationalism: T ...
which brought international competition. Testing theories related to geographic endowments economists
William Easterly William Russell Easterly (born September 7, 1957) is an American economist, specializing in economic development. He is a professor of economics at New York University, joint with Africa House, and co-director of NYU’s Development Research Inst ...
and Ross Levine find evidence that tropics, germs, and crops affect development through institutions. They find no evidence that tropics, germs, and crops affect country incomes directly other than through institutions, nor did they find any effect of policies on development once controls for institutions were implemented.


Innovation

Beginning in the early 19th century, economic prosperity rose greatly in the West due to improvements in technological efficiency, as evidenced by the advent of new conveniences including the
railroad Rail transport (also known as train transport) is a means of transport that transfers passengers and goods on wheeled vehicles running on rails, which are incorporated in tracks. In contrast to road transport, where the vehicles run on a pre ...
,
steamboat A steamboat is a boat that is marine propulsion, propelled primarily by marine steam engine, steam power, typically driving propellers or Paddle steamer, paddlewheels. Steamboats sometimes use the ship prefix, prefix designation SS, S.S. or S/S ...
,
steam engine A steam engine is a heat engine that performs mechanical work using steam as its working fluid. The steam engine uses the force produced by steam pressure to push a piston back and forth inside a cylinder. This pushing force can be tr ...
, and the use of
coal Coal is a combustible black or brownish-black sedimentary rock, formed as rock strata called coal seams. Coal is mostly carbon with variable amounts of other elements, chiefly hydrogen, sulfur, oxygen, and nitrogen. Coal is formed wh ...
as a fuel source. These innovations contributed to the Great Divergence, elevating
Europe Europe is a large peninsula conventionally considered a continent in its own right because of its great physical size and the weight of its history and traditions. Europe is also considered a Continent#Subcontinents, subcontinent of Eurasia ...
and the
United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territo ...
to high economic standing relative to the East. It has been argued the attitude of the
East East or Orient is one of the four cardinal directions or points of the compass. It is the opposite direction from west and is the direction from which the Sun rises on the Earth. Etymology As in other languages, the word is formed from the fa ...
towards innovation is one of the other factors that might have played a big role in the West's advancements over the East. According to
David Landes David Saul Landes (April 29, 1924 – August 17, 2013) was a professor of economics and of history at Harvard University. He is the author of ''Bankers and Pashas'', '' Revolution in Time'', ''The Unbound Prometheus'', '' The Wealth and Poverty ...
, after a few centuries of innovations and inventions, it seemed like the East stopped trying to innovate and began to sustain what they had. They kept nurturing their pre-modern inventions and did not move forward with the modern times. China decided to continue a self-sustaining process of scientific and technological advancement on the basis of their indigenous traditions and achievements. The East's attitude towards innovation showed that they focused more on experience, while the West focused on experimentation. The East did not see the need to improve on their inventions and thus from experience, focused on their past successes. While they did this, the West was focused more on experimentation and trial by error, which led them to come up with new and different ways to improve on existing innovations and create new ones.


Efficiency of markets and state intervention

A common argument is that Europe had more free and efficient markets than other civilizations, which has been cited as a reason for the Great Divergence. In Europe, market efficiency was disrupted by the prevalence of
feudalism Feudalism, also known as the feudal system, was the combination of the legal, economic, military, cultural and political customs that flourished in medieval Europe between the 9th and 15th centuries. Broadly defined, it was a way of structur ...
and
mercantilism Mercantilism is an economic policy that is designed to maximize the exports and minimize the imports for an economy. It promotes imperialism, colonialism, tariffs and subsidies on traded goods to achieve that goal. The policy aims to reduce a ...
. Practices such as
entail In English common law, fee tail or entail is a form of trust established by deed or settlement which restricts the sale or inheritance of an estate in real property and prevents the property from being sold, devised by will, or otherwise alien ...
, which restricted land ownership, hampered the free flow of labor and buying and selling of land. These feudal restrictions on land ownership were especially strong in continental Europe. China had a relatively more liberal land market, hampered only by weak customary traditions. Bound labor, such as
serfdom Serfdom was the status of many peasants under feudalism, specifically relating to manorialism, and similar systems. It was a condition of debt bondage and indentured servitude with similarities to and differences from slavery, which developed ...
and
slavery Slavery and enslavement are both the state and the condition of being a slave—someone forbidden to quit one's service for an enslaver, and who is treated by the enslaver as property. Slavery typically involves slaves being made to perf ...
were more prevalent in Europe than in China, even during the Manchu conquest. Urban industry in the West was more restrained by
guild A guild ( ) is an association of artisans and merchants who oversee the practice of their craft/trade in a particular area. The earliest types of guild formed as organizations of tradesmen belonging to a professional association. They sometimes ...
s and state-enforced monopolies than in China, where in the 18th century the principal monopolies governed salt and foreign trade through
Guangzhou Guangzhou (, ; ; or ; ), also known as Canton () and alternatively romanized as Kwongchow or Kwangchow, is the capital and largest city of Guangdong province in southern China. Located on the Pearl River about north-northwest of Hong Kong ...
. Pomeranz rejects the view that market institutions were the cause of the Great Divergence, and concludes that China was closer to the ideal of a market economy than Europe. Economic historian
Paul Bairoch Paul Bairoch (24 July 1930 in Antwerp – 12 February 1999 in Geneva) was a (in 1985 naturalised) Swiss economic historian of Belgian descent who specialized in urban history and historical demography. He published or co-authored more than two ...
presents a contrary argument, that Western countries such as the United States, Britain and Spain did not initially have
free trade Free trade is a trade policy that does not restrict imports or exports. It can also be understood as the free market idea applied to international trade. In government, free trade is predominantly advocated by political parties that hold eco ...
, but had
protectionist Protectionism, sometimes referred to as trade protectionism, is the economic policy of restricting imports from other countries through methods such as tariffs on imported goods, import quotas, and a variety of other government regulations. ...
policies in the early 19th century, as did China and Japan. In contrast, he cites the
Ottoman Empire The Ottoman Empire, * ; is an archaic version. The definite article forms and were synonymous * and el, Оθωμανική Αυτοκρατορία, Othōmanikē Avtokratoria, label=none * info page on book at Martin Luther University) ...
as an example of a state that did have free trade, which he argues had a negative economic impact and contributed to its
deindustrialization Deindustrialization is a process of social and economic change caused by the removal or reduction of industrial capacity or activity in a country or region, especially of heavy industry or manufacturing industry. There are different interpr ...
. The Ottoman Empire had a liberal trade policy, open to foreign imports, which has origins in
capitulations of the Ottoman Empire Capitulations of the Ottoman Empire were contracts between the Ottoman Empire and other powers in Europe, particularly France. Turkish capitulations, or Ahidnâmes were generally bilateral acts whereby definite arrangements were entered into ...
, dating back to the first commercial treaties signed with France in 1536 and taken further with capitulations in 1673 and 1740, which lowered duties to only 3% for imports and exports. The liberal Ottoman policies were praised by British economists advocating free trade, such as J. R. McCulloch in his ''Dictionary of Commerce'' (1834), but later criticized by British politicians opposing free trade, such as
prime minister A prime minister, premier or chief of cabinet is the head of the cabinet and the leader of the ministers in the executive branch of government, often in a parliamentary or semi-presidential system. Under those systems, a prime minister is ...
Benjamin Disraeli Benjamin Disraeli, 1st Earl of Beaconsfield, (21 December 1804 – 19 April 1881) was a British statesman and Conservative Party (UK), Conservative politician who twice served as Prime Minister of the United Kingdom. He played a centr ...
, who cited the Ottoman Empire as "an instance of the injury done by unrestrained competition" in the 1846
Corn Laws The Corn Laws were tariffs and other trade restrictions on imported food and corn enforced in the United Kingdom between 1815 and 1846. The word ''corn'' in British English denotes all cereal grains, including wheat, oats and barley. They we ...
debate:


Wages and living standards

Classical economists Classical economics, classical political economy, or Smithian economics is a school of thought in political economy that flourished, primarily in Britain, in the late 18th and early-to-mid 19th century. Its main thinkers are held to be Adam Smith ...
, beginning with
Adam Smith Adam Smith (baptized 1723 – 17 July 1790) was a Scottish economist and philosopher who was a pioneer in the thinking of political economy and key figure during the Scottish Enlightenment. Seen by some as "The Father of Economics"——� ...
and
Thomas Malthus Thomas Robert Malthus (; 13/14 February 1766 – 29 December 1834) was an English cleric, scholar and influential economist in the fields of political economy and demography. In his 1798 book ''An Essay on the Principle of Population'', Malt ...
, argued that high wages in the West stimulated labor-saving technological advancements. Revisionist studies in the mid to late 20th century have depicted
living standards Standard of living is the level of income, comforts and services available, generally applied to a society or location, rather than to an individual. Standard of living is relevant because it is considered to contribute to an individual's quality ...
in 18th century China and pre-Industrial Revolution Europe as comparable. According to Pomeranz life expectancy in China and Japan was comparable to the advanced parts of Europe. Similarly Chinese consumption per capita in calories intake is comparable to England. According to Pomeranz and others, there was modest per capita growth in both regions, the Chinese economy was not stagnant, and in many areas, especially agriculture, was ahead of Western Europe. Chinese cities were also ahead in public health. Economic historian
Paul Bairoch Paul Bairoch (24 July 1930 in Antwerp – 12 February 1999 in Geneva) was a (in 1985 naturalised) Swiss economic historian of Belgian descent who specialized in urban history and historical demography. He published or co-authored more than two ...
estimated that China's GNP per capita in 1800 was $228 in 1960
US dollars The United States dollar (symbol: $; code: USD; also abbreviated US$ or U.S. Dollar, to distinguish it from other dollar-denominated currencies; referred to as the dollar, U.S. dollar, American dollar, or colloquially buck) is the official ...
($ in 1990 dollars), higher than Western Europe's $213 ($ in 1990 dollars) at the time. Similarly for
Ottoman Egypt The Eyalet of Egypt (, ) operated as an administrative division of the Ottoman Empire from 1517 to 1867. It originated as a result of the conquest of Mamluk Egypt by the Ottomans in 1517, following the Ottoman–Mamluk War (1516–17) and the ...
, its per-capita income in 1800 was comparable to that of leading Western European countries such as
France France (), officially the French Republic ( ), is a country primarily located in Western Europe. It also comprises of Overseas France, overseas regions and territories in the Americas and the Atlantic Ocean, Atlantic, Pacific Ocean, Pac ...
, and higher than the overall average income of Europe and Japan. Economic historian Jean Barou estimated that, in terms of 1960 dollars,
Egypt Egypt ( ar, مصر , ), officially the Arab Republic of Egypt, is a transcontinental country spanning the northeast corner of Africa and southwest corner of Asia via a land bridge formed by the Sinai Peninsula. It is bordered by the Medite ...
in 1800 had a per-capita income of $232 ($ in 1990 dollars). In comparison, per-capita income in terms of 1960 dollars for France in 1800 was $240 ($ in 1990 dollars), for
Eastern Europe Eastern Europe is a subregion of the European continent. As a largely ambiguous term, it has a wide range of geopolitical, geographical, ethnic, cultural, and socio-economic connotations. The vast majority of the region is covered by Russia, wh ...
in 1800 was $177 ($ in 1990 dollars), and for Japan in 1800 was $180 ($ in 1990 dollars). According to Paul Bairoch, in the mid-18th century, "the average
standard of living Standard of living is the level of income, comforts and services available, generally applied to a society or location, rather than to an individual. Standard of living is relevant because it is considered to contribute to an individual's quality ...
in Europe was a little bit lower than that of the rest of the world." He estimated that, in 1750, the average GNP per capita in the
Eastern world The Eastern world, also known as the East or historically the Orient, is an umbrella term for various cultures or social structures, nations and philosophical systems, which vary depending on the context. It most often includes at least ...
(particularly China, India and the Middle East) was $188 in 1960 dollars ($ in 1990 dollars), higher than the West's $182 ($ in 1990 dollars). He argues that it was after 1800 that Western European per-capita income pulled ahead. However, the average incomes of China and Egypt were still higher than the overall average income of Europe. According to Jan Luiten van Zanden, the relationship between GDP per capita with wages and standards of living is very complex. He gives Netherlands economic history as an example. Real wages in Netherlands declined during the early modern period between 1450 and 1800. The decline was fastest between 1450/75 and the middle of the sixteenth century, after which real wages stabilized, meaning that even during the
Dutch Golden Age The Dutch Golden Age ( nl, Gouden Eeuw ) was a period in the history of the Netherlands, roughly spanning the era from 1588 (the birth of the Dutch Republic) to 1672 (the Rampjaar, "Disaster Year"), in which Dutch trade, science, and art and ...
purchasing power did not grow. The stability remained until the middle of 18th century, after which wages declined again. Similarly citing studies of the average height of Dutch men, van Zaden shows that it declined from the
Late Middle Ages The Late Middle Ages or Late Medieval Period was the period of European history lasting from AD 1300 to 1500. The Late Middle Ages followed the High Middle Ages and preceded the onset of the early modern period (and in much of Europe, the Ren ...
. During 17th and 18th centuries, at the height of Dutch Golden Age, the average height was 166 centimeters, about 4 centimeters lower than in 14th and early 15th century. This most likely indicates consumption declines during the early modern period, and average height would not equal medieval heights until the 20th century. Meanwhile, GDP per capita increased by 35 to 55% between 1510/1514 and the 1820s. Hence it is possible that standards of living in advanced parts of Asia were comparable with Western Europe in the late 18th century, while Asian GDP per capita was about 70% lower. Şevket Pamuk and Jan-Luiten van Zanden also show that during the Industrial Revolution, living standards in Western Europe increased little before the 1870s, as the increase in nominal wages was undermined by rising food prices. The substantial rise in living standards only started after 1870, with the arrival of cheap food from the Americas. Western European GDP grew rapidly after 1820, but real wages and the standard of living lagged behind. According to Robert Allen, at the end of the Middle Ages, real wages were similar across Europe and at a very high level. In the 16th and 17th century wages collapsed everywhere, except in the
Low Countries The term Low Countries, also known as the Low Lands ( nl, de Lage Landen, french: les Pays-Bas, lb, déi Niddereg Lännereien) and historically called the Netherlands ( nl, de Nederlanden), Flanders, or Belgica, is a coastal lowland region in N ...
and
London London is the capital and List of urban areas in the United Kingdom, largest city of England and the United Kingdom, with a population of just under 9 million. It stands on the River Thames in south-east England at the head of a estuary dow ...
. These were the most dynamic regions of the early modern economy, and their living standards returned to the high level of the late fifteenth century. The dynamism of London spread to the rest of England in 18th century. Although there was fluctuation in real wages in England between 1500 and 1850, there was no long term rise until the last third of 19th century. And it was only after 1870 that real wages begin to rise in other cities of Europe, and only then they finally surpassed the level of late 15th century. Hence while the Industrial Revolution raised GDP per capita, it was only a century later before a substantial raise in standard of living. However, responding to the work of Bairoch, Pomeranz, Parthasarathi and others, more subsequent research has found that parts of 18th century Western Europe did have higher wages and levels of per capita income than in much of India, Ottoman Turkey, Japan and China. However, the views of Adam Smith were found to have overgeneralized Chinese poverty. Maddison, Angus (2007), ''Contours of the World Economy, 1–2030 AD. Essays in Macro-Economic History'',
Oxford University Press Oxford University Press (OUP) is the university press of the University of Oxford. It is the largest university press in the world, and its printing history dates back to the 1480s. Having been officially granted the legal right to print books ...
,
Between 1725 and 1825 laborers in Beijing and Delhi were only able to purchase a basket of goods at a subsistence level, while laborers in London and Amsterdam were able to purchase goods at between 4 and 6 times a subsistence level. As early as 1600 Indian GDP per capita was about 60% the British level. A real decline in per capita income did occur in both China and India, but in India began during the Mughal period, before British colonialism. Outside of Europe much of this decline and stagnation has been attributed to population growth in rural areas outstripping growth in cultivated land as well as internal political turmoil. Free colonials in
British North America British North America comprised the colonial territories of the British Empire in North America from 1783 onwards. English colonisation of North America began in the 16th century in Newfoundland, then further south at Roanoke and Jamestow ...
were considered by historians and economists in a survey of academics to be amongst the most well off people in the world on the eve of the
American Revolution The American Revolution was an ideological and political revolution that occurred in British America between 1765 and 1791. The Americans in the Thirteen Colonies formed independent states that defeated the British in the American Revoluti ...
. The earliest evidence of a major health transition leading to increased
life expectancy Life expectancy is a statistical measure of the average time an organism is expected to live, based on the year of its birth, current age, and other demographic factors like sex. The most commonly used measure is life expectancy at birth ...
began in Europe in the 1770s, approximately one century before Asia's. Robert Allen argues that the relatively high wages in eighteenth century Britain both encouraged the adoption of labour-saving technology and worker training and education, leading to industrialisation.


Luxury consumption

Luxury consumption is regarded by many scholars to have stimulated the development of
capitalism Capitalism is an economic system based on the private ownership of the means of production and their operation for profit. Central characteristics of capitalism include capital accumulation, competitive markets, price system, private pr ...
and thus contributed to the Great Divergence. Proponents of this view argue that workshops, which manufactured luxury articles for the wealthy, gradually amassed capital to expand their production and then emerged as large firms producing for a mass market; they believe that Western Europe's unique tastes for luxury stimulated this development further than other cultures. However, others counter that luxury workshops were not unique to Europe; large cities in China and Japan also possessed many luxury workshops for the wealthy, and that luxury workshops do not necessarily stimulate the development of "capitalistic firms".


Property rights

Differences in
property rights The right to property, or the right to own property (cf. ownership) is often classified as a human right for natural persons regarding their possessions. A general recognition of a right to private property is found more rarely and is typically ...
have been cited as a possible cause of the Great Divergence. This view states that Asian merchants could not develop and accumulate capital because of the risk of state expropriation and claims from fellow kinsmen, which made property rights very insecure compared to those of Europe. However, others counter that many European merchants were de facto expropriated through defaults on government debt, and that the threat of expropriation by Asian states was not much greater than in Europe, except in Japan. Government and policies are seen as an integral part of modern societies and have played a major role in how different economies have been formed. The Eastern societies had governments which were controlled by the ruling dynasties and thus, were not a separate entity. Their governments at the time lacked policies that fostered innovation and thus resulted in slow advancements. As explained by Cohen, the east had a restrictive system of trade that went against the free world market theory; there was no political liberty or policies that encouraged the capitalist market (Cohen, 1993). This was in contrast to the western society that developed commercial laws and property rights which allowed for the protection and liberty of the marketplace. Their capitalist ideals and market structures encouraged innovation. Pomeranz (2000) argues that much of the land market in China was free, with many supposedly hereditary tenants and landlords being frequently removed or forced to sell their land. Although Chinese customary law specified that people within the village were to be offered the land first, Pomeranz states that most of the time the land was offered to more capable outsiders, and argues that China actually had a freer land market than Europe. However,
Robert Brenner Robert Paul Brenner (; born November 28, 1943) is a professor emeritus of history and director of the Center for Social Theory and Comparative History at UCLA, editor of the socialist journal ''Against the Current'', and editorial committee member ...
and Chris Isett emphasize differences in land tenancy rights. They argue that in the lower Yangtze, most farmers either owned land or held secure tenancy at fixed rates of rent, so that neither farmers nor landlords were exposed to competition. In 15th century England, lords had lost their serfs, but were able to assert control over almost all of the land, creating a rental market for tenant farmers. This created competitive pressures against subdividing plots, and the fact that plots could not be directly passed on to sons forced them to delay marriage until they had accumulated their own possessions. Thus in England both agricultural productivity and population growth were subject to market pressures throughout the early modern period. A 2017 study found that the presence of secure property rights in Europe and their absence in large parts of the Middle-East contributed to the increase of expensive labour-saving capital goods, such as water-mills, windmills, and cranes, in medieval Europe and their decrease in the Middle-East.


High-level equilibrium trap

The high-level equilibrium trap theory argues that China did not undergo an indigenous industrial revolution since its economy was in a stable equilibrium, where supply and demand for labor were equal, disincentivizing the development of labor-saving capital.


European colonialism

A number of economic historians have argued that
European colonialism The historical phenomenon of colonization is one that stretches around the globe and across time. Ancient and medieval colonialism was practiced by the Phoenicians, the Greeks, the Turks, and the Arabs. Colonialism in the modern sense bega ...
played a major role in the
deindustrialization Deindustrialization is a process of social and economic change caused by the removal or reduction of industrial capacity or activity in a country or region, especially of heavy industry or manufacturing industry. There are different interpr ...
of non-Western societies.
Paul Bairoch Paul Bairoch (24 July 1930 in Antwerp – 12 February 1999 in Geneva) was a (in 1985 naturalised) Swiss economic historian of Belgian descent who specialized in urban history and historical demography. He published or co-authored more than two ...
, for example, cites
British colonialism The British Empire was composed of the dominions, colonies, protectorates, mandates, and other territories ruled or administered by the United Kingdom and its predecessor states. It began with the overseas possessions and trading posts e ...
in India as a primary example, but also argues that European
colonialism Colonialism is a practice or policy of control by one people or power over other people or areas, often by establishing colonies and generally with the aim of economic dominance. In the process of colonisation, colonisers may impose their relig ...
played a major role in the deindustrialization of other countries in Asia, the Middle East, and
Latin America Latin America or * french: Amérique Latine, link=no * ht, Amerik Latin, link=no * pt, América Latina, link=no, name=a, sometimes referred to as LatAm is a large cultural region in the Americas where Romance languages — languages derived ...
, and contributed to a sharp economic decline in
Africa Africa is the world's second-largest and second-most populous continent, after Asia in both cases. At about 30.3 million km2 (11.7 million square miles) including adjacent islands, it covers 6% of Earth's total surface area ...
. Other modern
economic historians Economic history is the academic learning of economies or economic events of the past. Research is conducted using a combination of historical methods, statistical methods and the application of economic theory to historical situations and ins ...
have blamed
British colonial rule The British Empire was composed of the dominions, colonies, protectorates, mandates, and other territories ruled or administered by the United Kingdom and its predecessor states. It began with the overseas possessions and trading posts esta ...
for India's deindustrialization in particular. The colonization of India is seen as a major factor behind both India's deindustrialization and Britain's Industrial Revolution. The historian
Jeffrey G. Williamson Jeffrey Gale Williamson (born 1935) is the ''Laird Bell'' Professor of Economics (Emeritus), Harvard University; an Honorary Fellow in the Department of Economics at the University of Wisconsin (Madison); Research Associate at the National Bureau ...
has argued that India went through a period of deindustrialization in the latter half of the 18th century as an indirect outcome of the collapse of the
Mughal Empire The Mughal Empire was an early-modern empire that controlled much of South Asia between the 16th and 19th centuries. Quote: "Although the first two Timurid emperors and many of their noblemen were recent migrants to the subcontinent, the d ...
, with British rule later causing further deindustrialization. According to Williamson, the decline of the Mughal Empire led to a decline in agricultural productivity, which drove up food prices, then
nominal Nominal may refer to: Linguistics and grammar * Nominal (linguistics), one of the parts of speech * Nominal, the adjectival form of " noun", as in "nominal agreement" (= "noun agreement") * Nominal sentence, a sentence without a finite verb * N ...
wages, and then textile prices, which led to India losing a share of the world textile market to Britain even before it had superior factory technology, though Indian textiles still maintained a competitive advantage over British textiles up until the 19th century. Economic historian Prasannan Parthasarathi, however, has argued that there wasn't any such economic decline for several post-Mughal states, notably
Bengal Subah The Bengal Subah ( bn, সুবাহ বাংলা; fa, ), also referred to as Mughal Bengal ( bn, মোগল বাংলা), was the largest subdivision of the Mughal Empire (and later an independent state under the Nawabs of Be ...
and the
Kingdom of Mysore The Kingdom of Mysore was a realm in southern India, traditionally believed to have been founded in 1399 in the vicinity of the modern city of Mysore. From 1799 until 1950, it was a princely state, until 1947 in a subsidiary alliance with Br ...
, which were comparable to Britain in the late 18th century, until British colonial policies caused deindustrialization. Up until the 19th century, India was the world's leading cotton textile manufacturer, with
Bengal Bengal ( ; bn, বাংলা/বঙ্গ, translit=Bānglā/Bôngô, ) is a geopolitical, cultural and historical region in South Asia, specifically in the eastern part of the Indian subcontinent at the apex of the Bay of Bengal, predo ...
and
Mysore Mysore (), officially Mysuru (), is a city in the southern part of the state of Karnataka, India. Mysore city is geographically located between 12° 18′ 26″ north latitude and 76° 38′ 59″ east longitude. It is located at an altitude o ...
the centers of cotton production. In order to compete with Indian imports, Britons invested in labour-saving textile manufacturing technologies during their Industrial Revolution. Following political pressure from the new industrial manufacturers, in 1813, Parliament abolished the two-centuries-old,
protectionist Protectionism, sometimes referred to as trade protectionism, is the economic policy of restricting imports from other countries through methods such as tariffs on imported goods, import quotas, and a variety of other government regulations. ...
East India Company The East India Company (EIC) was an English, and later British, joint-stock company founded in 1600 and dissolved in 1874. It was formed to trade in the Indian Ocean region, initially with the East Indies (the Indian subcontinent and Sout ...
monopoly on trade with Asia and introduced import
tariff A tariff is a tax imposed by the government of a country or by a supranational union on imports or exports of goods. Besides being a source of revenue for the government, import duties can also be a form of regulation of foreign trade and ...
s on Indian textiles. Until then, the monopoly had restricted exports of British manufactured goods to India. Exposing the Proto-industrial hand spinners and weavers in the territories the British
East India Company The East India Company (EIC) was an English, and later British, joint-stock company founded in 1600 and dissolved in 1874. It was formed to trade in the Indian Ocean region, initially with the East Indies (the Indian subcontinent and Sout ...
administered in India to competition from machine spun threads, and woven fabrics, resulting in De-Proto-Industrialization, with the decline of native manufacturing opening up new markets for British goods. British colonization forced open the large Indian market to British goods while restricting Indian imports to Britain, and raw cotton was imported from India without taxes or tariffs to British factories which manufactured textiles from Indian cotton and sold them back to the Indian market. India thus served as both an important supplier of raw goods such as cotton to British factories and a large
captive market Captive markets are markets where the potential consumers face a severely limited number of competitive suppliers; their only choices are to purchase what is available or to make no purchase at all. The term therefore applies to any market where ...
for British manufactured goods. In addition, the capital amassed from
Bengal Bengal ( ; bn, বাংলা/বঙ্গ, translit=Bānglā/Bôngô, ) is a geopolitical, cultural and historical region in South Asia, specifically in the eastern part of the Indian subcontinent at the apex of the Bay of Bengal, predo ...
following its conquest after the
Battle of Plassey The Battle of Plassey was a decisive victory of the British East India Company over the Nawab of Bengal and his French allies on 23 June 1757, under the leadership of Robert Clive. The victory was made possible by the defection of Mir Jafar, w ...
in 1757 was used to invest in British industries such as textile manufacturing and greatly increase British wealth. Britain eventually surpassed India as the world's leading cotton textile manufacturer in the 19th century. British colonial rule has been blamed for the subsequently dismal state of
British India The provinces of India, earlier presidencies of British India and still earlier, presidency towns, were the administrative divisions of British governance on the Indian subcontinent. Collectively, they have been called British India. In one ...
's economy, with investment in Indian industries limited since it was a colony. Economic decline in India has been traced to before British colonial rule and was largely a result of increased output in other parts of the world and Mughal disintegration. India's share of world output (24.9%) was largely a function of its share of the world population around 1600. Between 1880 and 1930 total Indian cotton textile production increased from 1200 million yards to 3700 million yards. The introduction of railways into India have been a source of controversy regarding their overall impact, but evidence points to a number of positive outcomes such as higher incomes, economic integration, and famine relief. Per capita GDP decreased from $550 (in 1990 dollars) per person in 1700 under Mughal rule to $533 (in 1990 dollars) in 1820 under British rule, then increased to $618 (in 1990 dollars) in 1947 upon
independence Independence is a condition of a person, nation, country, or state in which residents and population, or some portion thereof, exercise self-government, and usually sovereignty, over its territory. The opposite of independence is the st ...
. Coal production increased in Bengal, largely to satisfy the demand of the railroads. Life expectancy increased by about 10 years between 1870 and independence. Recent research on colonialism has been more favorable regarding its long-term impacts on growth and development. A 2001 paper by Daron Acemoglu, Daren Acemoglu, Simon Johnson, and James A. Robinson (economist), James Robinson found that nations with temperate climates and low levels of mortality were more popular with settlers and were subjected to greater degrees of colonial rule. Those nations benefited from Europeans creating more inclusive institutions that lead to higher rates of long term growth. Subsequent research has confirmed that both how long a nation was a colony or how many Europeans settlers migrated there are positively correlated with economic development and institutional quality, although the relationships becomes stronger after 1700 and vary depending on the colonial power, with British colonies typically faring best. Acemoglu et al. also suggest that colonial profits were too small a percentage of GNP to account for the divergence directly but could account for it indirectly due to the effects it had on institutions by reducing the power of absolutist monarchies and securing property rights.


Culture

Rosenberg and Birdzell claim that the so-called eastern culture of respect and unquestionable devotion to the ruling dynasty was as a result of a culture where the control of the dynasty led to a silent society that "did not ask questions or experiment without the approval or order from the ruling class". On the other hand, they claimed that the West of the late medieval era did not have a central authority or absolute state, which allowed for a free flow of ideas (Rosenberg, Birdzell, 1986). This eastern culture also supposedly showed a dismissal of change due to their "fear of failure" and disregard for the imitation of outside inventions and science; this was different from the "western culture" which they claimed to be willing to experiment and imitate others to benefit their society. They claimed that this was a culture where change was encouraged, and sense of anxiety and disregard for comfort led them to be more innovative. Max Weber argued in ''The Protestant Ethic and the Spirit of Capitalism'' that capitalism in northern Europe evolved when the Protestant work ethic (particularly Calvinism, Calvinist) influenced large numbers of people to engage in work in the secular world, developing their own enterprises and engaging in trade and the accumulation of wealth for investment. In his book ''The Religion of China: Confucianism and Taoism'' he blames Chinese culture for the non-emergence of capitalism in China. Chen (2012) similarly claims that cultural differences were the most fundamental cause for the divergence, arguing that the Humanism of the
Renaissance The Renaissance ( , ) , from , with the same meanings. is a period in European history marking the transition from the Middle Ages to modernity and covering the 15th and 16th centuries, characterized by an effort to revive and surpass ide ...
followed by the Age of Enlightenment, Enlightenment (including revolutionary changes in attitude towards religion) enabled a mercantile, innovative, individualistic, and capitalistic spirit. For Ming Dynasty China, he claims there existed repressive measures which stifled dissenting opinions and nonconformity. He claimed that Confucianism taught that disobedience to one's superiors was supposedly tantamount to "sin". In addition Chen claimed that merchants and artificers had less prestige than they did in Western Europe.
Justin Yifu Lin Justin Yifu Lin (; born on October 15, 1952) is a Chinese economist and professor of economics at Peking University. He served as the Chief Economist and Senior Vice President of the World Bank from 2008 to 2012. He has been appointed as China ...
has argued for the role of the
imperial examination The imperial examination (; lit. "subject recommendation") refers to a civil-service examination system in Imperial China, administered for the purpose of selecting candidates for the state bureaucracy. The concept of choosing bureaucrats by ...
system in removing the incentives for Chinese intellectuals to learn mathematics or to conduct experimentation.Justin Yifu Lin, "Demystifying the Chinese Economy", 2011, Cambridge University Press, Preface xiv, http://assets.cambridge.org/97805211/91807/frontmatter/9780521191807_frontmatter.pdf However, many scholars who have studied Confucian teachings have criticized the claim that the philosophy promoted unquestionable loyalty to one's superiors and the state. The core of Confucian philosophy itself was already Humanism, humanist and Rationalism, rationalist; it "[does] not share a belief in divine law and [does] not exalt faithfulness to a higher law as a manifestation of divine will." One of the central teachings of Confucianism is that one should remonstrate with authority. Many Confucians throughout history disputed their superiors in order to not only prevent the superiors and the rulers from wrongdoing, but also to maintain the independent spirits of the Confucians. Furthermore, the merchant class of China throughout all of Chinese history were usually wealthy and held considerable influence above their supposed social standing. Historians like Yu Yingshi and Billy So have shown that as Chinese society became increasingly commercialized from the
Song dynasty The Song dynasty (; ; 960–1279) was an imperial dynasty of China that began in 960 and lasted until 1279. The dynasty was founded by Emperor Taizu of Song following his usurpation of the throne of the Later Zhou. The Song conquered the rest ...
onward, Confucianism had gradually begun to accept and even support business and trade as legitimate and viable professions, as long as merchants stayed away from unethical actions. Merchants in the meantime had also benefited from and utilized Confucian ethics in their business practices. By the Song period, the Scholar-officials themselves were using intermediary agents to participate in trading.Gernet, Jacques (1962). ''Daily Life in China on the Eve of the Mongol Invasion, 1250–1276''. Translated by H.M. Wright. Stanford: Stanford University Press. pp. 68–69 This is true especially in the Ming-Qing dynasties, when the social status of merchants had risen to such significance that by the late Ming period, many scholar-officials were unabashed to declare publicly in their official family histories that they had family members who were merchants. Consequently, while Confucianism did not actively promote profit seeking, it did not hinder China's commercial development either. Of the developed cores of the Old world, India was distinguished by its Caste system in India, caste system of bound labor, which hampered economic and population growth and resulted in relative underdevelopment compared to other core regions. Compared with other developed regions, India still possessed large amounts of unused resources. India's caste system gave an incentive to elites to drive their Unfree labour, unfree laborers harder when faced with increased demand, rather than invest in new capital projects and technology. The Indian economy was characterized by vassal-lord relationships, which weakened the motive of financial profit and the development of markets; a talented artisan or merchant could not hope to gain much personal reward. Pomeranz argues that India was not a very likely site for an industrial breakthrough, despite its sophisticated commerce and technologies. Aspects of Islamic law have been proposed as an argument for the divergence for the Muslim world. Economist Timur Kuran argues that Islamic institutions which had at earlier stages promoted development later started preventing more advanced development by hampering formation of corporations, capital accumulation, mass production, and impersonal transactions. Other similar arguments proposed include the gradual prohibition of independent religious judgements (Ijtihad) and a strong communalism which limited contacts with outside groups and the development of institutions dealing with more temporary interactions of various kinds, according to Kuran. According to historian Donald Quataert, however, the Ottoman Middle East's manufacturing sector was highly productive and evolving in the 19th century. Quataert criticizes arguments rooted in Orientalism, such as "now-discredited stereotypes concerning the inferiority of Islam", economic institutions having stopped evolving after the Islamic Golden Age, and decline of Ijtihad in religion negatively affecting economic evolution. Economic historian
Paul Bairoch Paul Bairoch (24 July 1930 in Antwerp – 12 February 1999 in Geneva) was a (in 1985 naturalised) Swiss economic historian of Belgian descent who specialized in urban history and historical demography. He published or co-authored more than two ...
noted that Ottoman law promoted Economic liberalism, liberal
free trade Free trade is a trade policy that does not restrict imports or exports. It can also be understood as the free market idea applied to international trade. In government, free trade is predominantly advocated by political parties that hold eco ...
earlier than Britain and the United States, arguing that free trade had a negative economic impact on the Ottoman Empire and contributed to its deindustrialization, in contrast to the more
protectionist Protectionism, sometimes referred to as trade protectionism, is the economic policy of restricting imports from other countries through methods such as tariffs on imported goods, import quotas, and a variety of other government regulations. ...
policies of Britain and the United States in the early 19th century.


Representative government

A number of economists have argued that representative government was a factor in the Great Divergence. They argue that absolutist governments, where rulers are not broadly accountable, are prone to corruption and rent-seeking while hurting property rights and innovation. Representative governments however were accountable to broader segments of the population and thus had to protect property rights and not rule in arbitrary ways, which caused economic prosperity.


Globalization

A 2017 study in the ''The American Economic Review, American Economic Review'' found that "globalization was the major driver of the economic divergence between the rich and the poor portions of the world in the years 1850–1900." The states that benefited from globalization were "characterised by strong constraints on executive power, a distinct feature of the institutional environment that has been demonstrated to favour private investment."


Chance

A number of economic historians have posited that the Industrial Revolution may have partly occurred where and when it did due to luck and chance.


The Black Death

Historian James Belich (historian), James Belich has argued that the
Black Death The Black Death (also known as the Pestilence, the Great Mortality or the Plague) was a bubonic plague pandemic occurring in Western Eurasia and North Africa from 1346 to 1353. It is the most fatal pandemic recorded in human history, cau ...
, a bubonic plague pandemic occurring in Afro-Eurasia from 1346 to 1353, set the conditions that made the Great Divergence possible. He argues that the pandemic, which caused mass death in Europe, doubled the per capita endowment of everything. A labor scarcity led to expanded use of waterpower, wind power, and gunpowder, as well as fast-tracked innovations in water-powered blast furnaces, heavily gunned galleons, and musketry.


Economic effects

The Old World methods of agriculture and production could only sustain certain lifestyles. Industrialization dramatically changed the European and American economy and allowed it to attain much higher levels of wealth and productivity than the other Old World cores. Although Western technology later spread to the East, differences in uses preserved the Western lead and accelerated the Great Divergence.


Productivity

When analyzing comparative use-efficiency, the economic concept of total factor productivity (TFP) is applied to quantify differences between countries. TFP analysis controls for differences in energy and raw material inputs across countries and is then used to calculate productivity. The difference in productivity levels, therefore, reflects efficiency of energy and raw materials use rather than the raw materials themselves. TFP analysis has shown that Western countries had higher TFP levels on average in the 19th century than Eastern countries such as
India India, officially the Republic of India ( Hindi: ), is a country in South Asia. It is the seventh-largest country by area, the second-most populous country, and the most populous democracy in the world. Bounded by the Indian Ocean on the ...
or China, showing that Western productivity had surpassed the East.


Per capita income

Some of the most striking evidence for the Great Divergence comes from data on per capita income. The West's rise to power directly coincides with per capita income in the West surpassing that in the East. This change can be attributed largely to the mass transit technologies, such as railroads and steamboats, that the West developed in the 19th century. The construction of large ships, trains, and railroads greatly increased productivity. These modes of transport made moving large quantities of coal, corn, grain, livestock and other goods across countries more efficient, greatly reducing transportation costs. These differences allowed Western productivity to exceed that of other regions. Economic historian
Paul Bairoch Paul Bairoch (24 July 1930 in Antwerp – 12 February 1999 in Geneva) was a (in 1985 naturalised) Swiss economic historian of Belgian descent who specialized in urban history and historical demography. He published or co-authored more than two ...
has estimated the GDP per capita of several major countries in 1960 US dollars after the Industrial Revolution in the early 19th century, as shown below. His estimates show that the GDP per capita of Western European countries rose rapidly after industrialization. For the 18th century, and in comparison to non-European regions, Bairoch in 1995 stated that, in the mid-18th century, "the average
standard of living Standard of living is the level of income, comforts and services available, generally applied to a society or location, rather than to an individual. Standard of living is relevant because it is considered to contribute to an individual's quality ...
in Europe was a little bit lower than that of the rest of the world."Chris Jochnick, Fraser A. Preston (2006)
''Sovereign Debt at the Crossroads: Challenges and Proposals for Resolving the Third World Debt Crisis'', pages 86–87
Oxford University Press Oxford University Press (OUP) is the university press of the University of Oxford. It is the largest university press in the world, and its printing history dates back to the 1480s. Having been officially granted the legal right to print books ...


Agriculture

Before and during the early 19th century, much of continental European agriculture was underdeveloped compared to Asian Cores and England. This left Europe with abundant idle natural resources.
England England is a Countries of the United Kingdom, country that is part of the United Kingdom. It shares land borders with Wales to its west and Scotland to its north. The Irish Sea lies northwest and the Celtic Sea to the southwest. It is separa ...
, on the other hand, had reached the limit of its agricultural productivity well before the beginning of the 19th century. Rather than taking the costly route of improving soil fertility, the English increased labor productivity by industrializing agriculture. From 1750 to 1850, European nations experienced population booms; however, European agriculture was barely able to keep pace with the dietary needs. Imports from the Americas, and the reduced caloric intake required by proletariat, industrial workers compared to farmers allowed England to cope with the food shortages. By the turn of the 19th century, much European farmland had been eroded and depleted of nutrients. Fortunately, through improved farming techniques, the import of fertilizers, and reforestation, Europeans were able to recondition their soil and prevent food shortages from hampering industrialization. Meanwhile, many other formerly hegemonic areas of the world were struggling to feed themselves – notably China.


Fuel and resources

The global demand for wood, a major resource required for industrial growth and development, was increasing in the first half of the 19th century. A lack of interest of silviculture in Western Europe, and a lack of forested land, caused wood shortages. By the mid-19th century, forests accounted for less than 15% of land use in most Western European countries. Fuel costs rose sharply in these countries throughout the 18th century and many households and factories were forced to ration their usage, and eventually adopt forest conservation policies. It was not until the 19th century that
coal Coal is a combustible black or brownish-black sedimentary rock, formed as rock strata called coal seams. Coal is mostly carbon with variable amounts of other elements, chiefly hydrogen, sulfur, oxygen, and nitrogen. Coal is formed wh ...
began providing much needed relief to the European energy shortage. China had not begun to use coal on a large scale until around 1900, giving Europe a huge lead on modern energy production. Through the 19th century, Europe had vast amounts of unused arable land with adequate water sources. However, this was not the case in China; most idle lands suffered from a lack of water supply, so forests had to be cultivated. Since the mid-19th century, Northern and southern China, northern China's water supplies have been declining, reducing its agricultural output. By growing
cotton Cotton is a soft, fluffy staple fiber that grows in a boll, or protective case, around the seeds of the cotton plants of the genus ''Gossypium'' in the mallow family Malvaceae. The fiber is almost pure cellulose, and can contain minor pe ...
for textiles, rather than importing, China exacerbated its water shortage. During the 19th century, supplies of wood and land decreased considerably, greatly slowing growth of Chinese per capita incomes.


Trade

During the era of European imperialism, periphery countries were often set up as specialized producers of specific resources. Although these specializations brought the periphery countries temporary economic benefit, the overall effect inhibited the industrial development of periphery territories. Cheaper resources for core countries through trade deals with specialized periphery countries allowed the core countries to advance at a much greater pace, both economically and industrially, than the rest of the world. Europe's access to a larger quantity of raw materials and a larger market to sell its manufactured goods gave it a distinct advantage through the 19th century. In order to further industrialize, it was imperative for the developing core areas to acquire resources from less densely populated areas, since they lacked the lands required to supply these resources themselves. Europe was able to trade manufactured goods to their colonies, including the Americas, for raw materials. The same sort of trading could be seen throughout regions in China and Asia, but colonization brought a distinct advantage to the West. As these sources of raw materials began to proto-industrialization, proto-industrialize, they would turn to import substitution, depriving the hegemonic nations of a market for their manufactured goods. Since European nations had control over their colonies, they were able to prevent this from happening. Britain was able to use import substitution to its benefit when dealing with textiles from
India India, officially the Republic of India ( Hindi: ), is a country in South Asia. It is the seventh-largest country by area, the second-most populous country, and the most populous democracy in the world. Bounded by the Indian Ocean on the ...
. Through industrialization, Britain was able to increase cotton productivity enough to make it lucrative for domestic production, and overtake India as the world's leading cotton supplier. Although Britain had limited cotton imports to protect its own industries, they allowed cheap British products into colonial India from the early 19th century. The colonial administration failed to promote Indian industry, preferring to export raw materials. Western Europe was also able to establish profitable trade with Eastern Europe. Countries such as Prussia, Bohemia and Poland had very little freedom in comparison to the West; forced labor left much of Eastern Europe with little time to work towards proto-industrialization and ample manpower to generate raw materials.


Guilds and journeymanship

A 2017 study in the ''Quarterly Journal of Economics'' argued, "medieval European institutions such as guilds, and specific features such as journeymanship, can explain the rise of Europe relative to regions that relied on the transmission of knowledge within closed kinship systems (extended families or clans)". Guilds and journeymanship were superior for creating and disseminating knowledge, which contributed to the occurrence of the Industrial Revolution in Europe.


See also

* Colonial empire * Deindustrialisation in India, Deindustrialisation in 19th century India * Economic history of China before 1912 * Eurocentrism * History of Western civilization * Mass production * Modern history * Textile manufacture during the British Industrial Revolution * Western empires


Books

* ''Roy Bin Wong#Before and Beyond Divergence, Before and Beyond Divergence'' * ''Niall Ferguson#Civilization, Civilization: The West and the Rest'' * ''The Civilizing Process'' * ''The Clash of Civilizations'' * ''The Eastern Origins of Western Civilisation'' * ''The European Miracle'' * ''A Farewell to Alms'' * ''Rodney Stark#Selected works, How the West Won: The Neglected Story of the Triumph of Modernity'' * ''Leonid Grinin#Great Divergence and Great Convergence, Great Divergence and Great Convergence'' * ''Kenneth Pomeranz#The Great divergence: China, Europe, and the making of the modern world economy, The Great Divergence: China, Europe, and the Making of the Modern World Economy'' * ''
Guns, Germs, and Steel ''Guns, Germs, and Steel: The Fates of Human Societies'' (subtitled ''A Short History of Everybody for the Last 13,000 Years'' in Britain) is a 1997 transdisciplinary non-fiction book by Jared Diamond. In 1998, it won the Pulitzer Prize for gen ...
'' * ''The Rise and Fall of the Great Powers'' * ''The Rise of the West'' * ''The Wealth and Poverty of Nations'' * ''Why the West Rules—For Now'' * ''Walter Scheidel#Works, The Great Escape: A Review Essay on Escape from Rome: The Failure of Empire and the Road to Prosperity''


References


Citations


Works cited

* * * * * * * * * * * * * * * * * * * * * * * * *


Further reading

* * Court, V. (2019).
A reassessment of the Great Divergence debate: towards a reconciliation of apparently distinct determinants
. ''European Review of Economic History''. . * * Root, Hilton L. (2020). ''Network Origins of the Global Economy: East vs. West in a Complex Systems Perspective''. Cambridge University Press. *


External links



– Estimates of economic growth between 1 and 2010

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