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Global Economic History: a Very Short

Introduction By Robert C. Allen

Article in Australian Economic History Review July 2012

DOI: 10.1111/j.1467-8446.2012.00344.x

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Gary B. Magee
Monash University (Australia)
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Robert C. Allen, Global Economic History: a Very Short Introduction. Oxford: Oxford
University Press, 2011. xvi + 170 pp. ISBN: 978 0 1995 9665 2. Paperback 7.99.

This book boldly sets out to present in a mere 147 pages of text a coherent economic history
of the world: a labour of almost Herculean proportions, some might contend. Fortunately,
its author, the eminent economic historian, Bob Allen, is more than up to the task. Drawing
freely from his seminal research on comparative real wages and prices, he has produced a
work of great synthesis and erudition that skilfully and concisely traces the path of the
global economy since 1500.

Global Economic History, of course, has its drawbacks. Some concepts and topics are
fleetingly introduced and finished with, something that not only will upset the sensitivities
of some specialists, but also leaves one wondering exactly how much the uninitiated reader
will actually comprehend. Then there are the occasional anachronisms, such as when British
inventors of the Industrial Revolution are described as spending much time and money
doing R&D (p. 33); the bold assertions, like there being a standard four-policies
development model (railways, tariffs, banks, and schools, p. 114); and the overlooked
literatures (the Islamic world, for example, warrants relatively little mention). Yet, such
glitches are almost to be expected in a book so accurately subtitled a very short
introduction.

So, what then is Allens take on global economic history? While he acknowledges the
background roles of geography, culture, and institutions, his overarching theory is
thoroughly rooted in economic processes unleashed by induced technological change,
globalisation and policy. At its heart lies Western Europes growing external reach and
pivotal role in the first global economy from 1500. Success on this front not only brought it
wealth, but promoted urbanisation and manufacturing, developments which were to carry a
number of consequences and shape subsequent European and global economic history.
Most importantly, they led to higher wages in Europe, which in turn prompted inter alia an
agricultural revolution and the growth of education. They also created a high level of
demand for energy, which ultimately led to the invention and introduction of new, cheaper
sources of energy, most crucially, coal. Europes relatively expensive labour and cheap
energy then created the incentive for the development of the labour-saving technologies of
the Industrial Revolution, which raised productivity and wages further and provided the
stimulant for the next round of even more capital-intensive and labour-saving technological
change. The productivity of British, and then Western European and US, manufacturing
allowed them to dominate global markets. Unable to introduce capital-intensive western
technology because of their relatively low wages and high capital costs, the traditional
manufacturing centres of Asia, Africa and South America simply deindustrialised. Their
comparative advantage in the global market had shifted to primary products; the same
forces have continued to act against their industrial development ever since.
 While his theory carries significant explanatory power, Allens account is not without gaps.
As mentioned, he begins his analysis in 1500, taking conditions at that time as given. Apart
from the fact that this choice leaves the majority of world economic history (i.e. pre-1500)
out of scope, it also raises analytical problems. Most notably, it means that no explanation
for Europes ability to unleash the first phase of globalisation around 1500 is presented.
Rather, this important development is somewhat surprisingly taken as a fait accompli. Thus,
with respect to the development of ocean-going shipping, Allen simply writes (p. 16) that
globalization required ships that could sail the high seas. Europeans did not have them
until the 15th century. These newly invented full-rigged ships could navigate the globe.
Where the capability to invent such ships and, more broadly, reach out so decisively beyond
its shores by 1500 came from is left largely undiscussed. In a similar vein, Allen asserts that,
unlike India and other poorer nineteenth-century nations, which could not profitably
introduce capital-intensive Western technologies, Meiji Japan was far more creative: they
redesigned technology to make it cost-effective in their low-wage economy (p. 122). This
may be true, but, again, no real explanation for Japans special creativity is given.

Putting these and similar gaps aside, Allen is to be commended for producing a very short
and accessible introduction to the field for the uninitiated. If one were to quibble, one might
wish that, given its intended audience, a more explicit selling of the intellectual and practical
value of economic history more generally might have been in order. To be fair, on this point,
the book actually does start off promisingly, opening with the eloquent and somewhat
tantalising statement that economic history is the queen of the social sciences (p. 1), a
sentiment, no doubt, that will resonate with many readers of this review. Sadly, the
metaphor is neither explained, nor developed further. Such a missed opportunity
notwithstanding, Global Economic History remains a thoroughly entertaining and learned
book. It is recommended to seasoned and novice economic historians alike.

Gary B. Magee
Monash University

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