Continuity and Change in The Early Modern Global Economy

Continuity and Change in The Early Modern

Global Economy

European World Week Four

Tim Davies

Lecture StructureIntroduction to the world economy, c.1500Changes in the economy 1500 – 1750…

Europe:PopulationAgricultureManufactureTrade

HistoriographyThe wider world and divergence

European Economies c. 1500Rural - PeasantrySome developments in trade…

Genoa and Venice

View of Genoa in the Sixteenth Century

European Economies c. 1500Rural - PeasantrySome developments in trade…

Genoa and VeniceDominance of Italy and Flanders (Belgium)Large gap between rich and poor societiesLimited choice (Musgrave)

The World Beyond EuropePoly-centricSignificance of Asia:

Islamic worldTransnational interactionMastery of science, navigation and a sophisticated

commercial structure

A market scene, Constantinople,

sixteenth century

The World Beyond EuropePoly-centricSignificance of Asia:

Islamic worldTransnational interactionMastery of science, navigation and a sophisticated

commercial structureChina

Widespread literacy, sophisticated economyOverseas exploration (Zheng He)

Hongzhi Emperor (Ming Dynasty), 1470-1505

Zheng He, (1371-1433)

Economic Growth in Europe?Emmanuel Le Roy Ladurie,

The Peasants of Languedoc = ‘l’histoire immobile’Low production ceiling…

Population and UrbanisationDramatic population rise in some areas … increased

European population as a whole…75 million in 1500110 – 120 million in 1700(De Vries, 1984, p. 36)

More of this population lived in towns…

Rising prices as demand increasedProduction (agricultural and manufacture) appears to keep

pace

AgricultureTwo periods of agrarian change:

1500 – 1600More intensive use of land

1600 – 1750Labour efficiencies

Mark Overton

Proto-IndustrialisationF. Mendels, 'Proto-industrialisation: the First

Phase of the Industrialisation Process', JEconH, 32 (1972)

P. Kriedte, H. Medick and J. Schlumbohm, Industrialization before Industrialization (Cambridge, 1981)

Proto-Industrialisation

Proto-IndustrialisationRural labour; often in tandem with agricultural

workProduction for a market – using urban-based

merchantsLow rate of technological changeExtensive rather than intensive growthDiversification

ManufactureDevelopment in certain industries and

areas…MiningIronStill small scale…Importance of England, Sweden and

HollandAlthough some development elsewhere

Iron industry in Germany, sixteenth century

Mining in Germany, sixteenth century

Antwerp Stock Exchange, 1650

The English and Dutch East India Companies

The Role of the StateMercantilism

Sixteenth and seventeenth centuriesStates and foreign tradeTariffs

National banksBank of Sweden, 1668Bank of England, 1694

Some Explanations…Population growth => economic activity => sustained

economic growth (Postan)

Weak peasant farmers, strong capitalist farmers => enclosure and farming innovations => rapid agricultural growth (Brenner)

Enhanced protections of property rights => incentive for profitable activity => sustained economic growth (North)

Wallerstein and World SystemsImmanuel Wallerstein,

The Modern World-System, vol. 1: Capitalist Agriculture and the Origins of the European World Economy in the Sixteenth century (1974)

Centre and Periphery…

World Beyond Europe, c.1750Ottoman Empire

Imperial overstretch?China

Regime changeNo more overseas expansion

Changes seem quite marked in comparison to Europe:Foreign tradePower of the state – mercantilismDevelopment of Proto-Industry

Divergence?

Stagnation?Not everywhere in Europe experienced

such developments. This is important…Economic growth not a normal

condition. 0.04 % – 0.08% annually.North/South divideJan Luiten van Zanden – measuring early

modern economic growth

ConclusionsA transition to capitalism?Owners of capital rather than owners of

landNew world of choice and variation…

But not everyone includedNot yet a unified global economy…

Beginnings of divergence?