Accounting for the ‘Little Divergence’ What drove economic growth in preindustrial Europe, 1300-1800?
Alexandra de Pleijt () and
Jan Luiten van Zanden
No 46, Working Papers from Utrecht University, Centre for Global Economic History
The Little Divergence is the process of differential economic growth within Europe in the period between 1300 and 1800, during which the North Sea Area developed into the most prosperous and dynamic part of the Continent. We test various hypotheses about the causes of the Little Divergence, using new data and focusing on trends in GDP per capita. The results are that institutional changes (in particular the rise of active Parliaments), human capital formation and structural change are the primary drivers of the growth that occurred, which contrast sharply with previous findings by Robert Allen (who however focused on real wages as dependent variable). We also test for the role of religion (the spread of Protestantism): this has affected human capital formation, but does not in itself have an impact on growth. Moreover, we find an insignificant effect of the land-labour ratio, which shows the limitations of the Malthusian model for understanding the Little Divergence.
Keywords: Europe; economic growth; Little Divergence; institutional change (search for similar items in EconPapers)
Pages: 25 pages
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Journal Article: Accounting for the “Little Divergence”: What drove economic growth in pre-industrial Europe, 1300–1800? (2016)
Working Paper: Accounting for the ‘Little Divergence’ What drove economic growth in pre-industrial Europe, 1300-1800? (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:ucg:wpaper:0046
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