Global Economic History

Book Review:

Historical Change and the Limits of European Experience
Roy Bin Wong
Cornell University Press, 1997
Book Review by Nicolaus Shombe (PHD14407)

• General Summary of the Book
• Economic History
– Agrarian to Industrialization

• Political Comparison
– State formation
– Ideology and Institutional resources

• Social Protest and Revolutions

General Summary

Historical transformation of China V/S Historical pattern of development of Early
Modern Europe.
The history of development of Western Europe has been considered as global

Patterns of historical change which include similarities and differences of
economic development and theories of industrialization such as Malthus theory
and Smithian theory.

Comparing State Formation and Transformation

Similarities and Differences between Politics, Protests and Social Change in China
and Europe

Economic History

China between 10th – 12th Centuries had society with urban culture which engaged in
expanding commercial economy.

Chinese could produce surplus for trading

In comparing Economic history and problems of development between China and Europe,
Chinese peasants’ economic undertakings were similar in fundamental and important to those of

Both early modern Europe and late imperial China shared Smithian economic growth dynamics,

Major changes in China began in the area of central China (near Shanghai) where there were
improvement of productivity in the agriculture.
The same pattern of growth was observed in Europe which is considered to be Adam Smith
growth path in which division of labor and specialization led to development in Europe.

same path of Early European development

Smithian growth → productivity in agriculture →surplus production → expansion of trade which
is prerequisite condition for the increase in division of labor and labor specialization in
production and trading.

Economic History

There was an increase in cash cropping and hand craft activities in different parts of
Chinese empire between the 16th – 18th C especially in Yangzi delta and Pearl river

Apart from products market, the factor market also emerged in Yangzi River where
there were land market for rental and sales also Labor market developed for both Long
Term and Short Term labor.

Textile formed a major rural hand craft centers similar to Europe especially in Jiangsu
and Zhejing provinces villages where increases number of peasants began to turn either
to cotton yarn and cloth production or silk weaving during 16th C.

both Europe and China experienced cycle of economic growth and contractions which
led to the division of labor and comparative advantage through the market.
In the cause of population growth, the Black Death occurred in 14th C reduced
population . In China also in 17th C and 19th C, rebellions, natural disasters, general
crisis of economic, social and political difficulties happened which is similar to the
Malthusian check

The author insisted that similarities between Europe and China continued until just
before Industrial revolution

State Formation and Transformation

During the time of the Roman Empire both Europe and China had roughly similar (agrarian
empire) formations, but while China sustained that state formation and the idea of a unified
polity until the 20thC, Europe experienced disintegration

After collapse of Roman Empire Europe never again had an imperial political formation of any
great size with the capacity to exercise centralize control over its territories.

Both European states and the Chinese empire faced different challenges, claims, and
commitments, and they did so in different ways

Chinese expanded its empire through combination of morality, material, and coercive means
with principal goal in achieving stability

European dynamics of imperial expansion embraced commercial, political and military

Chinese political economy was intended to capture the benefits of expanded production and
exchange through policies that increased production and stabilized trade

The crucial distinction between China and Europe: political economies was greater
adaptability of Europe to industrial possibilities.

State Formation and Transformation
• European state lacks institutional strategies to promote social order
• European rulers competed with institutionally distinct and powerful
aristocracies, cleric and urban elite
• In China the emperor worked to develop sustainable bureaucracy
while in Europe warfare among European rulers to expand their
• Domestic order in China involved both rural and urban while in
Europe is urban area

Institutions and Taxation
States function is raising revenue, guarding threats against
external enemies, assuring domestic social stability

China Taxation – agriculture taxation at low rate for provision of
services and welfare of the people
Institutional – Land was allotted by state so that peasants could
pay tax to support the state
State coordinated food supply as governments policy to
coordinate welfare
Used society to maintain peace and stability
House hold records for land, taxes and prevention of crimes
Use of extended kinship networks organized in cooperate
fashion to reproduce social order

Raising revenue
• China and Europe had different revenue mobilization strategies
• In Europe state makers competed with other power holders
(nobles, clerics and merchants) to redefine and expand there
claims on resources
• In China had system of taxation which was modest and steady
• In Europe borrowed loans against future revenue
• Chines relied on commercial tax and agriculture land
• Chines did not borrow but used its surplus in merchants to earn
interest rate.

Social Protest and Revolutions
• Grain seizures
• Tax resistance
• Revolutions in China and Europe- France.

1789 to 1799 during which France went from a monarchy ruled
by King Louis XVI to a republic ruled by the people

– Chinese Communist Revolution – collapse in Qing dynasty in
1911 created political crisis

The China After 1850
• Invasion by foreign
• Fought war – increase revenue
• Military strategized in the cost – resources were allocated in this area
1911 – 1949
• State rebuilding and Nationalism in 20th Century
- local capacity were expanded
• Anti-Japanese war (1937 -45) - Nationalism and establishment of People’s
Republic off China in 1949
China After 1949
• Communist inherited 1949 economy with modest industrial base
• Socialist country – investment decision is done by state (what to produce and
how much to produce)
State Bureaucracy
• Cadres system
• Unitary state with effective rule over the entire country
• China managed to continue united because it had no corporate groups, no elite
with their own bas power and authority