Week 1: Before Growth Began Flashcards
Economic growth?
-measured in GDP per capita growth
-must be sustained
Extensive growth?
- a rise in inputs (more people/land) causing a rise in output (not modern econ growth)
- rather than productivity
Intensive growth?
- a rise in output caused by a rise in productivity not a rise in inputs
Smithian growth?
-economic growth driven by increased specialization and division of labour
-urbanisation can be a proxy for Smithian specialisation
How can productivity rise?
-Division of labour (Smithian Growth)
-Technological innovation
-Better management
Grain wage?
-type of PPP
-wage expressed as the amount of grain (wheat, rice) you could buy
Malthusian trap?
-Population growth “uses up” income growth, so that incomes per person fall back to subsistence
Path Dependency?
-Today is determined by yesterday
-GDP is path dependent, especially in the short run
-Technology can be path dependent
-Shocks can change the path a country or technology are on (war, famine…)
The Great Divergence?
Economic growth started in England, and it, its neighbours and offshoots, remained ahead for many years
Was the economic leaders determined by path dependence?
No
-Areas that had the Neolithic revolution first are poorer today (Olsen and Paik)
Neolithic revolution?
-the first economic revolution
-the Neolithic transformation from hunter-gather to settled agriculture
-5000 years between Israel etc and UK
Examples of Chinese wealth?
-1400 China far ahead
-The Ming Voyages as an example of Chinese prowess
-No European equivalent
Info on 7 Ming Voyages?
-To India and east coast of Africa
-3500 ships
So what happens to China?
-The Ming dynasty turns inwards (policy of isolation)
-Forbidden City building cost (cf European Cathedrals built only in good times, Buringh)
-Bad harvests, flooding
-Threat of Mongols
-They destroy their fleet in 1525: lost the technical know-how
-Internal grain trade falls after 1750
Who says churches are only built in good times?
-Burnigh
-China built forbidden city which diverted resources away from other critical sectors, contributing to economic stagnation.
In 1800, how can we compare Yangtze delta vs England reasons?
-agriculture output per worker is close to the same
-crops
-marriage and fertility rate
-No demographic transition
Crops in the context of Yangtze delta vs England?
-In the Yangtze Delta, rice cultivation achieved higher land productivity but lower labor productivity due to its labor-intensive nature, driven by dense populations.
-In England, oat cultivation relied on land and mechanization, achieving higher labor productivity but lower land productivity.
Marriage and fertility in the context of Yangtze delta vs England?
-marriage patterns and fertility rates were influenced by economic and agricultural factors, with rice cultivation encouraging larger families due to labor demands, whereas wheat cultivation did not create the same incentive.
-In China families had a around 8 children on average
-In England high age of marriage
How does no demographic transition effect China?
Very large families bad for economic growth
Malthusian trap still applies in China
Makes them vulnerable to famine
Areas with enough grain reluctant to trade – no resilience
Voth and Voigtländer 2013?
The Black Death caused a reversion to pastoral agriculture in England
-Women have
a Comparative Advantage in pastoral agriculture
as it is less reliant on brute strength
- Women’s bargaining power in the marriage market increased
-Marriage ages rise, never-married props increase
-Opportunity Cost of children rises, Fertility mechanically
declines
Income grows and the West Rises
What does Clark argue about being better off and divergence with China?
-average person in 1800 was likely no better off, and potentially worse off, than their Stone Age ancestors.
-High fertility rates among the wealthy in England compared to China, A transfer of skills, capital, and resources to future generations.
Greater economic mobility and increased chances of wealthier descendants driving innovation and productivity improvements.
What does Clark argue about being England’s divergence?
Institutional stability, (private property)
Demographic changes
Increased innovation, driven not by greater rewards but by a greater supply of innovations.
Access to resources, Britain = ‘Workshop of the World’
What does Court reason caused the great divergence?
-Religion (he Protestant Reformation, influenced human capital accumulation, governance, and social ethics)
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State Capacity: The fragmented political landscape of Europe, characterized by competition between states, led to advancements in military technology and fiscal innovations
