Yet More Economic History
By Arnold Kling
A representative sentence from John Darwin’s history of the world since 1400, After Tamerlane (p. 305).
The steamship and railway were the battering rams with which European traders could break the monopolies that African coastal elites and their inland allies had tried to maintain over their commercial hinterlands.
As the “battering rams” metaphor illustrates, Darwin strains to play up the West’s violence and use of slavery. He also strains to play up the progressive aspects of the Islamic realm, China, Japan, India, and Russia.
Nonetheless, After Tamerlane has a lot to offer those of us with an appetite for economic history.p. 23:
the difficulty of forming autonomous states on an ethnic basis, against the gravitational pull of cultural or economic attraction (as well as disparities of military force), has been so great that empire (where different ethnic communities fall under a common ruler) has been the default mode of political organization throughout most of history.
Note that I started reading the book after writing The Benefits of Hegemony.
On p. 28:
By the 400’s, Roman rule in the West was breaking down…towns dwindled to mere junctions on old Roman roads; society and economy became overwhelmingly rural and preoccupied with subsistence…between AD 500 and 1000, even parts of Europe that had once been Romanized became too poor and inaccessible to be of much interest to traders
[in the 1500’s] the Estado became a system for extorting protection money from the seaborne trade between South East Asia, western India, the Persian Gulf and the Red Sea. Asian merchants had to buy a cartaz or safe conduct at one of the Portuguese ‘factories’…or run the risk of plunder by the Estado’s sea captains.
But there was little sign by the end of the long sixteenth century (c. 1620)…of a world economy…the commodities that circulated…were not staples but luxuries; their volume was tiny…fifty to seventy ships departed annually for the East from Lisbon
after 1803…British sea power demolished the mercantilist zoning that had subdivided world trade into exclusive blocs…the excuse for commercial monopoly (justified in the past on grounds of the high price of protection) and the bar to new entrants were all cut away.
This is a key point. Prior to British hegemony, competition was military for monopoly access to markets. Under British hegemony, competition was mercantile with open access to markets.
But Darwin continues
It is unlikely, however, that these striking advances would have yielded much more than a temporary gain…The great limitation on Europe’s commercial exchanges with most of the rest of Eurasia had been the miserably small scale of trade. It was almost entirely confined to luxury goods…A year’s worth of imports from Asia (so Jan de Vries has calculated) would scarcely fill up one modern container ship.
Then comes the industrial revolution. On p. 189:
By 1810, calculates Paul Bairoch, a British operative using a spinning machine produced ten to fourteen times as much cotton yarn in an hour as his Indian competitor using traditional methods.
Of course, this leads to the question, emphasized and answered by Gregory Clark in A Farewell to Alms, of why the Indian worker’s productivity did not reach similar levels when spinning machines were introduced there.
Continued improvements in transportation, communication, and international finance produced striking changes. p. 238:
By 1880 the cost of basic commodities (like food grains) was set by their price on the world market…The volume of trade grew by twenty-five times between 1820 and 1913
Building states in pre-colonial Africa was exceptionally arduous. Imposing taxes or duties on reluctant subjects was hard anywhere. But, where rebelling meant no more than walking away to found a splinter community…
Don’t you wish that rebelling were that simple today? It probably is still simple, if you’re willing to live in an isolated remote village somewhere.