The term “The Great Divergence” was coined by American political scientist, Samuel Huntington in 1996. It refers to the socioeconomic that Europe, especially Western Europe faced during the 19th century. The European countries advanced other countries during the modern age and became the most powerful and wealthy. There were advancements in many fields during the Great Divergence; especially in the field of technology. This led to increased industrialization.
A better understanding of the Great Divergence would help to refine some received economic wisdom - particularly the assumption that economic success is determined by a country’s culture. The Great Divergence was not simply caused by European culture, it emerged because a business-friendly, open, and innovative economy was created – mostly by an accident. Why did sustained industrial growth begin in Northwest Europe, despite surprising similarities between advanced areas of Europe and East Asia? According to Ken Pomeranz as recently as 1750, parallels between these two parts of the world were very high in life expectancy, consumption, product and factor markets, and the strategies of households. He states that the Chinese and Japanese cores were no worse off ecologically than Western Europe. Core areas throughout the eighteenth-century Old World faced comparable local shortages of land-intensive products that were only partly resolved by trade.
Pomeranz argues that Europe’s divergence from the Old World in the nineteenth century was thanks to their supply of coal, a superior alternative to timber. As such, Europe’s failure to use its land intensively was not much of a problem and energy-intensive industries began to grow. Fortuitous global conjunctures resulted in the Americas becoming a greater source of primary products for Europe than any Asian periphery. Consequently, Northwest Europe grew dramatically in population, specialised further in manufacture, and removed labour from the land by using increased imports rather than maximising yields. Together, coal and the New World allowed Europe to grow along resource-intensive, labour-saving paths.
On the other hand, Asia hit a cul-de-sac of sorts. Although the East Asian hinterlands boomed after 1750, both in population and in manufacturing, this same growth prevented these peripheral regions from exporting vital resources to the cloth-producing Yangtze Delta. Growth in the core of East Asia’s economy essentially stopped, and whatever growth existed was forced along labour-intensive, resource-saving paths — paths Europe could have been forced down, too, had it not been for the favourable resource stocks from underground and overseas. Asia was also failing to catch up with Europe in technology. Heavy restrictions on foreign trade were forced upon by Tokugawa Japan and Qing China. This barred the European countries from making any profits from trading with the rich Asian countries. However, European countries were able to inflict significant power moves in these countries as observed in the Opium Wars of 1839-42 and 1856-60, where they were able to bend the rules to their advantage.
The ubiquitous Mughal Empire started to shake with infighting and foreign invasions by Nader Shah and Ahmad Shah Durrani, which paved the way for Marathas. The Europeans saw this as an opportunity to establish themselves as a power in India.
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The economic disparity between European and Asian countries were visible before 1913. The cause however was still a mystery. Interestingly, the per capita income of Southern Europe fell from 75.2 to 47.3%, the gap in Eastern Europe widened from 30 to 58%, in Asia from 44 to 80% and in Africa from 54 to 85%. There were no constant forces in that caused the Great Divergence. These were however, more alarming before 1870 given the trade forces among the poor.
According to Kenneth Pomeranz, The Great Divergence started after 1750- 1800. Numerous empirical references project only a few differences between Britain and China which in turn point to this thesis. Therefore, it makes sense to think that the aforementioned countries had an equal level of income, development, and technology. Pomeranz has not only been an ardent critic of the commonly stated reasons for Divergence but has played an instrumental role in deciphering its major causes. The first reason is concerned with accumulation, the second - technology, and the third - institutions. Europe had a higher level of per capita livestock which implies they had access to greater capital with positive implications for agriculture, transportation, and nutrition. Pomeranz considered this to be false because he believed that living standards and income did not truly open until 1800. When it comes to technology, the argument put forward by Pomeranz was that the European countries were well ahead as a consequence of efficient use of energy, the innovation of fossil fuels, and the timely adoption of land saving techniques. Concerning institutions, China had competitive markets as well as proper legal systems of property rights coupled with freer marketplaces than Europe.
A few centuries ago, it would have been difficult to tell Europe apart from the rest of the world—in economic terms, at least. Moreover, half a millennium ago Europe might justly have been considered a laggard. The three inventions which, in the words of Karl Marx, “ushered in bourgeois society” were not invented in Europe. Gunpowder, the compass, and the printing press were probably all invented in China.
But by the 19th century, things had changed radically. Western Europe and parts of North America had become fabulously wealthy leaving almost everyone else rather poor. Economic historians refer to this as the “Great Divergence”. The timing of the divergence is hotly debated even today. Some think that it took off around 1800 while others reckon that it happened earlier. Such debates will probably never be resolved with much precision and conviction, given the unreliability of the evidence.
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