An Essay on “The Great Divergence” by Marc Roca Ferrer

These days, there is the intense debate regarding the “rise of China” pointing out the

huge GDP gains, often in the high single digits, that have been happening in the last 25 years,

but I want to let the reader know that China is merely returning to the balance of power that

the world was in at the start of the 18th century, when China accounted for approximately

30% of the whole world GDP. In this essay, we will explore the “Great Divergence” a term

coined first by Samuel Huntington which refers to the process by which Western World 1

overcame pre-modern growth constraints and by consequence it became the most powerful

and wealthy civilization of all time. I will start by providing a brief introduction to the “rise

of the West” schools of thought and then speak about Kenneth Pomeranz works that have

brought the Industrial Revolution debate up to date. But did the Great Divergence really

happen? Was Japan part of it? and what do other World Historians have to say about

Pomeranz work?

First of all, we have to speak about the three different schools of thought about class

relations, if we are to understand where is this “Great Divergence” is coming from: the

mainstream approach has always been influenced by the Weberian perspective, which

focuses on the Western society values like modern capitalism, state and science, the Marxist

perspective which is more based on modes of production (that when used for historical

analyses has become more scarce compared to others) and also the neo-marxist approach of

Wallerstein’s World System that also doesn’t give much importance to the British Industrial

Revolution and then we have the School of California (in which Pomeranz is one of it’s most

prolific scholars) , which surprisingly attaches no particular importance to capitalism, that

defines that there we a lot of resemblances between the most advanced economies of Eurasia,

and that the divergence took place lately due to industrialization and that it was quite sudden.

They also mainly focused on China up until now, but they are starting to include Tokugawa

1 Frank, Andre (2001), "Review of The Great Divergence", Journal of Asian Studies, Cambridge University Press, 60 (1): 180–182

Japan which Peer Vries defines as an “advanced organic economy”. Moving on to speak 2

about the economy, I want to define what is considered modern growth. Up to the 1800s the

GDP growth was 0.1% to 0.2% per year, mainly due to the focus on an agricultural economy,

but after the Industrial Revolution and starting with Britain in the 1700s it became what we

now refer to as modern growth which consists of 1% to 2% a year, this brought Britain to

become wealthier than the other world cores due to achieving this kind of growth a century

before the others, and as I will explain later, even though the technologies used in the West

arrived to the East, they were used differently, so the East didn’t achieve this kind of growth

until much later. 3

Secondly, let’s dive into another text of Kenneth Pomeranz named “Chinese

Development in Long-Run Perspective” to understand what happened in region in the second

half of the 18th century. Coastal China, specifically the Yangzi Delta, was one of the richest

regions of the world until the Industrial Revolution thanks to their inter-regional trade. They

used the excess wealth to provide for the peripheries and this prevented capital accumulation

and a huge migration towards the richest areas (opposite of Britain) that helped maintain the

economic gap between regions. But we must ask, why didn’t they develop the same as 4

Britain? Well, to start, they lacked energy sources like coal, wood, peat and most metallic

ores , and this made it unlikely that people would switch from an agrarian economy to a 5

more capital intensive one as huge profits weren’t available due to unskilled industrious

workers earning just a little bit more than their agrarian counterparts. Another key difference

is the strong feeling of managerial work that the Chinese and Japanese had, in a way, they

didn’t convert to proletariat because they didn’t want to work for another and lose their

independence for such a small increment in wealth. So we can observe that China had a 6

more rural industry and more widespread economy and the West had a more concentrated

capital-intensive economy that didn’t care about constraints because they had the New World

to provide for more raw resources, nonetheless, in my opinion, the most important factor was

the concentration of brilliant minds that advanced the technology used for the industry, “a

2 Vries, Peer (2016) What we do and do not know about the Great Divergence at the beginning of 2016 3 Clark, Gregory; Feenstra, Robert C. (2003), "Technology in the Great Divergence", in Bordo, Michael D. (ed.), Globalization in Historical Perspective (PDF), University of Chicago Press, pp. 277–320 4 Pomeranz, Kenneth (2005) Chinese Development in Long-Run Perspective 5 Vries, Peer (2016) What we do and do not know about the Great Divergence at the beginning of 2016 6 Vries, Peer (2016) What we do and do not know about the Great Divergence at the beginning of 2016

network of knowledge” with a cooperative and communal scientific research spirit instead of 7

market competition, that really allowed the British to achieve the monumental feat of a rapid

increase of GDP year after year.

But what about Japan? Well, if we study the textile industries of both China and Japan

in the nineteenth century, we can observe that Japan had the stronger economy. And as Akira 8

Hayami said: “Japan did not industrialize because of its industriousness. Its industrialization

was not the natural outcome of an internal evolution: it came via an external shock.” Japan 9

had ample supply of labor and the way they made the switch towards a more proletarian

economy was to offer seniority wages and life-long employment, a value switch towards hard

work to make them think that their jobs improved the country. But moving back to the 10

Tokugawa era, we knew that the economy was mainly agrarian, with only a 1% of the land

used for livestock, and it was mainly comprised of small farmsteads. This model didn’t solve

the problem of lack of land for the Japanese, so they developed highly sophisticated agrarian

techniques like intercropping and seed selection. This improvement of productivity allowed

the agrarian excedent to be commercialized and a proto industrialization happened not long

after. Here, we can observe again that technology is the most important factor in economic 11

growth.

If we are to speak about mercantilism, we have to talk about the concept that

Pomeranz introduced in his book, about the concept ghost acreage, which means that he

thought that Britain, by having the colonies, was able to have sustained economic growth

over most of the nineteenth century. This was due to the possibility of importing raw

materials, but as De Vries points out, by already having the industrious capacity, the huge

amount of imports like cotton made sense and helped growth. But did the “Little Ice Age” 12

impact mercantilism? We could say that due to this environmentally driven crisis, the growth

wasn’t noticed until the 18th century, even if many of the changes in consumption patterns

7 Bateman, Victoria (2012) “Markets and Growth in Early Modern Europe”, pp. 171. 8 Debin Ma, ‘Why Japan, not China, was the first to develop in East Asia. Lessons from sericulture, 1850–1937’, Economic Development and Cultural Change, 52, 2 /2004, 369–394; 9 Hayami, Akira (2015) “Japan’s industrious revolution”, 71 and 124. 10 Vries, Peer (2016) What we do and do not know about the Great Divergence at the beginning of 2016 11 Martínez Taberner, G. and Delgado, J. (2011). La Región del Nanyō. El Japón Meiji y las colonias asiáticas del imperio español, 1858-1898. 1st ed. 12 Vries, Peer (2016) What we do and do not know about the Great Divergence at the beginning of 2016

already started happening at the start of the 17th in Europe in terms of more urban-based

consumption and import of exotic goods from overseas (tea, spices…). Another key factor 13

was that the merchants were considered a good “class” in Europe but not as much in Asia,

one has to ask himself, do I work harder and increase output if I am recognized by my peers?

In my opinion, yes you do, so that's why Europe had more of a growth economy, these

merchants really helped mercantilism thrive. And lastly, we now know that thanks to the

increase of caloric rich foods found in the new world all of this was possible, potatoes for

instance are a high density food, which means that you also don’t need to eat many a day to

reach your caloric needs, this made possible that less people had to work the fields and had

more human capital to study things like biology, physics or machinery.

Lastly, we should explore what other great historians have to say about Pomeranz

work. The bulletin of Historical Society released a special edition in 2011, ten years after 14

the first publication of “the Great Divergence” with reflections of different world historians.

Peter A. Coclanis proposes the four R’s and the One Without to make his critique: changing

the level of refraction on through which we view the early modern world, reorientation of the

understanding that Asia had an economic importance in the premodern world on what was

just an eurocentric point of view, recalibration of the central issues in the demographic

history of England, rejuvenation of the early modern economic history that in consequence

has brought different scholars from different disciplines to do new research throughout the

world and lastly resolution, he emphasises that the Californians have deepened our

knowledge but mostly our interest on those issues. Jan de Vries celebrates the book but he

says the content is hard to believe, he gives us three reasons on why the book is influential:

it’s a book for our time, it offers a new approach to comparative history and it emphasizes

ecological and environmental history, but then he tells us why he is not convinced by it and

gives us three reasons: in his opinion, the divergence began earlier, the divergence was not

initiated by the British Revolution and the explanation of coal and colonies is insufficient.

After reading him, we could say that Pomeranz’s comparative analysis is too informal as he

doesn’t use institutions or the military at all. Moving on to Philip T. Hoffman comment, he

13 Sugihara, Kaoru & Wong, R.Bin (2015). The Cambridge World History. 1st ed. Cambridge: Cambridge University Press. 14 Historically Speaking (2011) Assessing Kenneth Pomeranz’s The Great Divergence: A Forum, Volume 12, Number 4, September 2011

starts off by commending Pomeranz on bringing scholars together and opening the debate by

asking “when did the gap of incomes open between the West and Asia?” but he emphasises

that the British Industrial Revolution was not foreordained, that it was a consequence of

historical accidents and warfare technological development and he also poses us the question

on why didn’t China use said technology to rapidly industrialize in the 19th century. On the

other hand, R. Bin Wong, also points out what he thinks are the two main points of

Pomeranz's book: that the early modern Chinese economy was more similar to European

economy than most people think and that the importance of coal and colonies was paramount

to the divergence. But he also says that the main reason of Europe's swift ascension was the

permanent threat of war that lead to the substitution of labor for capital and brought upon us

the technological change. Lastly, Kenneth Pomeranz gives his opinion and he agrees that his

book doesn’t provide an adequate resolution to the issue, but in my opinion, he was happy

that his work light a fire on researchers to touch this economic era.

In conclusion, there would be no the “Great Divergence” debate without the scholars

of the California School , indeed the great divergence did happen but in my opinion it was a 15

casual accident, if peace was achieved in Europe and wars stopped being so important we

might still live in a less technological world, but alas they were not, so scientists banded

together and they achieved new technological improvements, but we cannot blame the

Chinese or Japanese for their lack of industrialization, humans respond to threats, and the

latter had none, one was focused on having an agrarian economy and by being an importer of

silver from the New World for their mercantile needs and as we will see in the future, they

paid a dear price when they tried to catch up with the West with the Great Leap Forward led

by Mao Zedong in 1949 and Japan by being closed for so long, also, without any threat to

their sovereignty they didn’t have the need to become an industrious economy, but we have

to hand it to them, after the second world war they achieved something incredible in terms of

economic growth. As my closing remark I would like to say that by being an enthusiast of

Japan and economic history I cannot wait to read “Japan and the Great Divergence” by

Professor Peer Vries project due in 2018, which might become a book as important as “The

Great Divergence” by Kenneth Pomeranz’s has been.

15 Vries, Peer (2016) What we do and do not know about the Great Divergence at the beginning of 2016

Bibliography:

Bateman, Victoria (2012) “Markets and Growth in Early Modern Europe” Bentley, J., Subrahmanyam, S. and Wiesner, M. (2015). The Cambridge World History Clark, Gregory; Feenstra, Robert C. (2003), "Technology in the Great Divergence" Debin Ma, ‘Why Japan, not China, was the first to develop in East Asia. Lessons from sericulture, 1850–1937’ Frank, Andre (2001), "Review of The Great Divergence", Journal of Asian Studies Hayami, Akira (2015) “Japan’s industrious revolution” Martínez Taberner, G. and Delgado, J. (2011). La Región del Nanyō. El Japón Meiji y las colonias asiáticas del imperio español, 1858-1898. 1st ed. Pomeranz, Kenneth (2005) Chinese Development in Long-Run Perspective Historically Speaking (2011) Assessing Kenneth Pomeranz’s The Great Divergence: A Forum, Volume 12, Number 4, September 2011 Vries, Peer (2016) What we do and do not know about the Great Divergence at the beginning of 2016