Findlay, Ronald and Kevin O’Rourke, Power and Plenty: Trade, War and the World Economy in the Second Millennium(2007), 619p.
In this ambitious survey of the world economy during the last millennium, Findlay and O’Rourke have set out to place contemporary globalization in a broad historical context of uneven economic development. Many historians have seen the first industrial revolution as the source of the “great divergence” between Western Europe and the rest of the world. This study argues that the industrial revolution “can only be understood as the outcome of a historical process with multiple causes stretching well back into the medieval period, and in which international movements of commodities, warriors, microbes, and technologies all played a leading role. Purely domestic accounts of the ‘Rise of the West,’ emphasizing Western institutions, cultural attributes, or endowments, are hopelessly inadequate, since they ignore the vast web of interrelationships between Europe and the rest of the world that had been spun for many centuries, and was crucially important for the breakthrough to modern economic growth.” While Marxists have argued that Western Europe’s economic success was primarily due to its use of power and exploitation, the authors argue that they view “inventiveness and an incentives…as being the heart of growth” but this does not imply that European overseas expansion should be written off as irrelevant. “Plunder may not have directly fueled the industrial revolution, but mercantilism and imperialism were an important part of a global context within which it originated, expanding markets and ensuring the supply of raw materials. Violence thus undoubtedly mattered in shaping the environment in which the conventional economic forces of supply and demand operated.”
Central to their study is their view that interregional trade was the key to economic growth. Their analysis consists of describing the geopolitics of Eurasia’sand North Africa’s major regions and their interactions, which gradually brought the rest of the world into a world economy. These regions are Western Europe (the Catholic area before the Reformation), Eastern Europe (Orthodox Christian), North Africa and South-West Asia (Islamic heartland), Central or Inner Asia, South-East Asia, and East Asia. One of their key contributions is their constant reminder that economic geography and resource endowments were key factors in regional economic success. The authors point out that at the beginning of the millennium the pivotal region of the world was the Islamic world, for it was in contact with the rich areas of both the east as well as the relatively less developed western European region. The central event during this period was the Pax Mongolica, which knitted together most of the Eurasian landmass under the Mongol Empire, stimulating trade from Japan to the Atlantic. This also allowed the spread of the plague, the Black Death of the 14th century, which, despite its devastating immediate effects, helped create a “microbial common market” in Eurasia, which in turn allowed the expansion of population, output and prices around the world, but especially in Western Europe and Southeast Asia.
This crisis set the stage for the launching of the Iberian voyages of ‘discovery’ of the New World and the initial exploitation of its resources with the labor of African slaves under the command of Western Europeans. This was followed by a long struggle for hegemony in the emerging world economy between the Dutch Republic, Great Britain and France, while, at the other end of the world, the Russian Czarist and Chinese Manchu Qing empires struggled for hegemony in central and Far Eastern Asia. At this point the authors interrupt their narrative to take a closer look at the fundamental breakthrough of the industrial revolution in Britain and Western Europe. They argue that the industrial revolution “set in motion economic forces that determined the future course of international trade, down to our own day.” It produced a “Great Divergence” in income levels between regions as the new technologies spread unevenly across the globe and created a “Great Specialization” between “an industrial core and a primary-producing periphery. This resulted in the protection of agriculture in the core and the protection of manufacturing in the periphery and “finally a gradual unwinding of these trends as the industrial revolution spread to encompass an ever increasing proportion of the globe.” The authors explain that this process was not a smooth evolution but “was profoundly marked by the political consequences of three major world wars, the French and Napoleonic wars that ended the age of mercantilism, World War I and World War II.” According to the authors, war, the ultimate exercise of power, which was vastly expanded by the industrial revolution, has had and continues to have a vast impact on the evolution of the world economy. The authors have successfully synthesized a vast body of economic and historical literature to produce an impressive economic history of the world economy that places the study of the European industrial revolution in a world historical context. Its extensive bibliography is an excellent guide to the contemporary debates on the history of globalization and the origin and consequences of the industrial revolution.