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What was a deliberate effort made by countries to catch up with Britain in the standard model of development?
What was a deliberate effort made by countries to catch up with Britain in the standard model of development?
What was the main reason for the delay in the onset of modern economic growth in many regions?
What was the main reason for the delay in the onset of modern economic growth in many regions?
Which regions were the first to transition to modern economic growth after Britain?
Which regions were the first to transition to modern economic growth after Britain?
What were the key elements of the standard model of development?
What were the key elements of the standard model of development?
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What was still fragmentary in Germany in the mid-1800s compared to Britain?
What was still fragmentary in Germany in the mid-1800s compared to Britain?
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What explains the wide difference in incomes across the globe today?
What explains the wide difference in incomes across the globe today?
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What is one of the direct effects of geography on per capita income, as discussed in the text?
What is one of the direct effects of geography on per capita income, as discussed in the text?
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According to the Engerman-Sokoloff thesis, what does Latin America's geography favor, leading to inequality in wealth, education, and political power?
According to the Engerman-Sokoloff thesis, what does Latin America's geography favor, leading to inequality in wealth, education, and political power?
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What did Roy (2008) argue about informal institutions in C19th India?
What did Roy (2008) argue about informal institutions in C19th India?
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What is a key factor contributing to the low per capita incomes of ethnic groups severely affected by the Atlantic and Indian Ocean slave trades?
What is a key factor contributing to the low per capita incomes of ethnic groups severely affected by the Atlantic and Indian Ocean slave trades?
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What did Galor, Moav, and Vollrath (2009) link to the emergence of human-capital promoting institutions in the U.S. during 1900-1940?
What did Galor, Moav, and Vollrath (2009) link to the emergence of human-capital promoting institutions in the U.S. during 1900-1940?
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'The long-term effects of Africa’s slave trades' by Nunn (2008) and Wantchekon (2011) highlight what as a consequence of the slave trades?
'The long-term effects of Africa’s slave trades' by Nunn (2008) and Wantchekon (2011) highlight what as a consequence of the slave trades?
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Which event marked the beginning of the Great Divergence in GDP per capita?
Which event marked the beginning of the Great Divergence in GDP per capita?
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What was a significant factor contributing to the benefits for primary goods exporters?
What was a significant factor contributing to the benefits for primary goods exporters?
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What challenge hindered Japan's modernization in agriculture?
What challenge hindered Japan's modernization in agriculture?
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According to the Hayami-Ruttan thesis, what is required for agricultural development?
According to the Hayami-Ruttan thesis, what is required for agricultural development?
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What is a key requirement for transitioning to modern economic growth?
What is a key requirement for transitioning to modern economic growth?
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What influences societies' trade-off between anarchy and despotism?
What influences societies' trade-off between anarchy and despotism?
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Which factor may delay the transition to modern economic growth?
Which factor may delay the transition to modern economic growth?
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What is a potential risk associated with close informal relations between government, banks, and firms in Big Push policies?
What is a potential risk associated with close informal relations between government, banks, and firms in Big Push policies?
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Which historical events are cited as examples of Big Pushes gone wrong?
Which historical events are cited as examples of Big Pushes gone wrong?
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What does the California School argue may explain the Great Divergence between Europe and China?
What does the California School argue may explain the Great Divergence between Europe and China?
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What factor may halve the institutional effect estimate on growth according to the text?
What factor may halve the institutional effect estimate on growth according to the text?
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What may contribute to delaying the onset of modern economic growth in some regions?
What may contribute to delaying the onset of modern economic growth in some regions?
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Which factor contributed to the dominance of Western textiles in world markets?
Which factor contributed to the dominance of Western textiles in world markets?
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What led to deindustrialization in non-Western parts of the world?
What led to deindustrialization in non-Western parts of the world?
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What drove the Great Specialization and Great Divergence in the 19th century?
What drove the Great Specialization and Great Divergence in the 19th century?
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What contributed to Ottoman deindustrialization?
What contributed to Ottoman deindustrialization?
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What was a characteristic of railway networks by the early 20th century in Europe-China comparison?
What was a characteristic of railway networks by the early 20th century in Europe-China comparison?
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What was a peculiar characteristic of tariffs in the West?
What was a peculiar characteristic of tariffs in the West?
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What led to deindustrialization in non-Western parts of the world?
What led to deindustrialization in non-Western parts of the world?
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What was a consequence of Ottoman deindustrialization?
What was a consequence of Ottoman deindustrialization?
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What were the driving forces behind the Great Specialization and Great Divergence in the 19th century?
What were the driving forces behind the Great Specialization and Great Divergence in the 19th century?
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What contributed to the dominance of Western textiles in world markets?
What contributed to the dominance of Western textiles in world markets?
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What was a peculiar characteristic of tariffs in the West?
What was a peculiar characteristic of tariffs in the West?
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'Europe-China comparison' shows differences in which aspect by the early 20th century?
'Europe-China comparison' shows differences in which aspect by the early 20th century?
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What are the direct effects of geography on per capita income as discussed in the text?
What are the direct effects of geography on per capita income as discussed in the text?
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What did Roy (2008) argue about informal institutions in C19th India?
What did Roy (2008) argue about informal institutions in C19th India?
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What does the Engerman-Sokoloff thesis suggest about Latin America's geography?
What does the Engerman-Sokoloff thesis suggest about Latin America's geography?
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According to Galor, Moav, and Vollrath (2009), what was linked to the emergence of human-capital promoting institutions in the U.S. during 1900-1940?
According to Galor, Moav, and Vollrath (2009), what was linked to the emergence of human-capital promoting institutions in the U.S. during 1900-1940?
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'The long-term effects of Africa’s slave trades' by Nunn (2008) and Wantchekon (2011) highlight what as a consequence of the slave trades?
'The long-term effects of Africa’s slave trades' by Nunn (2008) and Wantchekon (2011) highlight what as a consequence of the slave trades?
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What is a key factor contributing to the low per capita incomes of ethnic groups severely affected by the Atlantic and Indian Ocean slave trades?
What is a key factor contributing to the low per capita incomes of ethnic groups severely affected by the Atlantic and Indian Ocean slave trades?
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Which factor hindered Japan's modernization in agriculture?
Which factor hindered Japan's modernization in agriculture?
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What does the Hayami-Ruttan thesis suggest about agricultural development?
What does the Hayami-Ruttan thesis suggest about agricultural development?
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What do institutions represent in the context of societal choices?
What do institutions represent in the context of societal choices?
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What is the significance of the Great Divergence in GDP per capita?
What is the significance of the Great Divergence in GDP per capita?
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'Transition to modern economic growth often requires the capacity to innovate' - What does this statement imply?
'Transition to modern economic growth often requires the capacity to innovate' - What does this statement imply?
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'Societies' trade-off between anarchy and despotism depends on their institutional possibility frontier' - What does this statement suggest?
'Societies' trade-off between anarchy and despotism depends on their institutional possibility frontier' - What does this statement suggest?
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Study Notes
Economic Growth, Deep Root Problems, and Big Push Policies
- Big Push policies may lead to rapid transitory growth, as seen in East Asian convergence after 1950
- Poverty traps, such as lack of infrastructure, savings, or necessary industries, can delay the transition to modern economic growth
- Late-industrializing countries may require greater state initiative, as heavy government involvement in East Asian industrialization suggests
- Close informal relations between government, banks, and firms in Big Push policies can lead to corruption risks
- Central planning in the Soviet Union coped with mass production but failed in late 20th-century frontier developments
- Examples of Big Pushes gone wrong include Stalinist industrialization in the USSR and the Great Leap Forward in China
- The California School argues that geographic differences, such as coal supply and access to complementary resources, can explain the Great Divergence between Europe and China
- Institutional legacy effects from colonization policies, such as checks and balances and property rights protection, can impact long-run growth
- European settlers' institutions, cultural factors, and disease environments all play a role in long-run growth, making it hard to isolate institutional effects
- Disease burden and present-day Malaria risk can halve the institutional effect estimate on growth
- Differences in geographic endowments, institutions, and culture may contribute to delaying the onset of modern economic growth in some regions
- The transition to modern economic growth may require a "Big Push" and involve overcoming deep root factors such as geographic endowments and institutional legacies
Railway Networks, Trade Liberalization, and Industrialization in the 19th Century
- Germany's railway network caught up with Britain's by 1880
- Europe-China comparison shows early 20th-century railway network differences
- Mass education spread quickly in the West by the early 20th century
- Tariffs were comparatively high in the West due to a peculiar Western characteristic
- Asymmetric free trade treaties and military imbalances emerged in the 19th century
- Import competition led to deindustrialization in non-Western parts of the world
- The British cotton textile industry became competitive due to increased total factor productivity
- Western textiles began dominating world markets, leading to deindustrialization in other regions
- Ottoman deindustrialization led to a shift in comparative advantage to primary goods production
- The Great Specialization and Great Divergence were driven by increasing returns to scale and transportation advancements
- New Economic Geography models explain trade specialization and income divergence in the 19th century
- Steamships and railways led to the Great Specialization and Great Divergence in the 19th century
The Great Divergence and Economic Growth Challenges
- The Great Divergence in GDP per capita began around 1820
- Some regions transitioned to modern economic growth while specializing in primary production
- Terms of trade effects led to benefits for primary goods exporters
- China and India experienced long-run declines in per capita incomes
- Japan's technology transfer challenges in agriculture hindered its modernization
- U.S. agricultural technology was not useful in Japan due to different land-labor ratios
- The Hayami-Ruttan thesis suggests different endowments require different technologies for agricultural development
- Transition to modern economic growth often requires the capacity to innovate
- Institutions are endogenous choices that societies make to navigate between undesirable extremes
- Societies' trade-off between anarchy and despotism depends on their institutional possibility frontier
- Different societal fundamentals lead to different institutions that minimize social losses due to expropriation
- Rwanda's steep institutional possibility frontier is influenced by a history of ethnic conflict
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Test your knowledge about crucial economic concepts such as The Great Divergence and Caveats to the deindustrialization thesis. Explore the transition to modern economic growth and the impact on primary production and global trade.
