World Economic History:

IntroductionOctober 1, 2007

Growth, historically

Introduction

The Malthusian trap

The Industrial Revolution

The Great Divergence

Life expectancy (years) - today & back then

0

10

20

30

40

50

60

70

80

90

DivergingGDP per capita

1990 International Geary-Khamis dollars

0

5000

10000

15000

20000

25000

30000

1 1000 1500 1600 1700 1820 1900 1950 2000

Western EuropeWestern OffshootsAsia AfricaWorldLatin America

The Malthusian economy

The Malthusian trap

Who was Malthus?

The model

The trap

The 3 assumptions Each society has a birth rate (B) that

increases with material living standards The death rate (D) declines as living

standards increase Material living standards decline as

population increases

PopulationIncome per capita

B-D

Surviving children per woman, pre-modern

1.90

1.95

2.00

2.05

2.10

Norway SouthernItaly

France England NorthernItaly

Iceland

Life expectancy and death rates

0

20

40

60

80

100

120

5 10 15 20 25 30 35

Death rate (per thousand)

Lif

e ex

pec

tanc

y (y

ears

)

Long-run equilibrium in the Malthusian economy

Revealed technological advance

Virtues and Vices in the Malthusian model

Living standards

Wages and Prices – some examples

Real Wages, England 1250-1850

The plague

Stagnant living standards….

GDP per capita: England vs. the other countries

Evidence for other countries in pre-modern times

0

5

10

15

20

25

30

Ancie

nt Bab

ylonia

Classic

al Athe

ns

Roman

Egy

pt

Engla

nd*

Amste

rdam

*

Paris

*

China*

*

Japa

n*

Day

wag

e in

pou

nds of

whe

at (*) 1780-1800 (**) 1750-1849

Calories intake per capita

0500

10001500200025003000350040004500 (*) 1878-96 (**) 1812 (***)1980s (****)1970s

Stature and living standards

62

63

64

65

66

67

68 (*) 1710-59 (**)1830s (***)1819-39 (****)1800-29 (*****) 1883-92

Hours worked

0

2

4

6

8

10

12

England1720-39

England1780-99

Tatuyo Ache Yanomano