R. Allen – New Perspectives on Well-Being in Asia and Europe (2005)

Автор: R. Allen
Название книги: New Perspectives on Well-Being in Asia and Europe (2005)
Формат: PDF
Жанр: История Азии и Африки
Страницы: 495
Качество: Изначально компьютерное, E-book

When did Europe pull ahead of Asia in terms of living standards? A number of well-known scholars compare economic and demographic indicators of well-being in the pre-industrial period. The emerging picture is not one of great differences, but of considerable similarities in standard of living between Europe and Asia before the Industrial Revolution.

Inequality in global living standards is a major challenge facing humanity in the new millennium. Real output per capita
in Western Europe and North America is more than ten times that of many less developed countries. Differences are
also substantial with respect to educational attainment, average length of life, and the general health of the population.
Several dichotomies have been used to label this gap including rich and poor, developed–underdeveloped,
developed–developing, North–South; the latter referring to its geographical boundaries. It also has, however, an
East–West dimension—more obvious in the 1960s than today after some of the East-Asian countries have
experienced rapid industrialization and tremendous economic growth.
The main concern of this book is to assess when the gap between the East and the West emerged and to not only take
economic perspectives into consideration but social and demographic ones as well. The established view, stemming
from the classical economists and still influential, is that the gap originated far back in history, perhaps thousands of
years ago. This view has lately been challenged both by economists and demographers studying Asian history,
stimulating an intense debate on the long-term economic development of Europe and Asia (especially China). Many of
the arguments in this debate, however, have been based on fragmentary evidence collected from a few areas of a
handful of countries. This book contributes to this debate by presenting a collection of historical analyses aiming to
deepen and refine our knowledge of this important issue. The contributions cover major Asian and European
countries and regions presenting new evidence and interpretations not only on income, health, and education but also
on the ability to overcome short-term economic stress. In this way, we are able to provide a more substantial empirical
foundation for debate on when the gap in living standards between the East and the West emerged.
1. The Established View Challenged
The established view that the gap emerged before the Industrial Revolution, perhaps thousands of years ago, was
worked out in the eighteenth century in the context of trade between Europe and Asia. Since the Middle Ages,
Europeans had imported tropical goods from Asia and found that they had to pay for them with silver since their
manufactures were uncompetitive in Asian markets. This was partly a question of quality and partly a question of price—European goods were simply more expensive than their Asian counterparts.
From the late seventeenth century onwards, the English East India Company took advantage of this differential and
began to ship Indian cotton textiles to Europe. This trade was so successful that English woollen producers secured
the prohibition of Indian calicoes in Britain. They continued to be re-exported, however, to other parts of Europe and
to Africa and the Americas. The merchants engaged in these trades were well aware of the costs and prices of the
goods they sold and observed that the cheapness of Indian cottons was a direct result of the lowness of Indian wages
in comparison to those in England. This observation underlay the pessimistic view of Asian living standards.
The question was, were Asian wages even lower, on a percentage basis, than Asian prices? Adam Smith (1776/1937)
thought so. ‘Rice in China is much cheaper than wheat is any-where in Europe’ (1776/1937: 189). Wages were still
lower. ‘The difference between the money price of labour in China and Europe, is still greater than that between the
money price of subsistence; because the real recompense of labour is higher in Europe than in China, the greater part
of Europe being in an improving state, while China seems to be standing still’ (1776/1937: 189). As a result, ‘the
poverty of the lower ranks of people in China far surpasses that of the most beggarly nations in Europe’ (1776/1937:
72). People living on fishing boats near Canton were so poor that ‘any carrion, the carcass of a dead dog or cat, for
example, though half putrid and stinking, is as welcome to them as the most wholesome food to the people of other
countries’ (1776/1937: 20). Smith had the same view of India (1776/1937: 206).
Why were real wages lower in Asia than in Europe? Adam Smith propounded the liberal view that stable and secure
property rights, low taxation, limited government, and free trade were the bases of economic expansion, and expansion
was the cause of high wages. ‘The proportion between the real recompense of labour in different countries’, he argued,
‘is naturally regulated’ by the ‘advancing, stationary, or declining condition’ of their economies (1776/1937: 189–90).
While he objected to certain features of British policy—the Navigation Acts, which limited free trade, were objects of
sustained attack—he regarded Britain's free labour, land, and product markets as particularly conducive to
development. Asian wages were low because its economy was ‘stationary’. This was due, in turn, to the lack of the
broad markets, secure property, and limited government, which the English and the Dutch enjoyed.
China's economy was paradoxical because the country was both rich and stationary. The riches were due to its natural
fertility and to a considerable division of labour based on internal commerce. China, like India and ancient Egypt,
‘seem all to have derived their great opulence from inland navigation’ (1776/1937: 20). The process was taken furthest
in China. ‘In the Eastern provinces of China…several great rivers form, by their different branches, a multitude of
canals, and by communicating with one another afford an inland navigation much more extensive than that either of
the Nile or the Ganges, or perhaps than both of them put together’ (1776/1937: 20). Rich as it was, however, Chinese institutions prevented the country from reaching its full potential. ‘China seems to
have been long stationary, and had probably long ago acquired that full complement of riches which is consistent with
the nature of its laws and institutions. But this complement may be much inferior to what, with other laws and
institutions, the nature of its soil, climate, and situation might admit of ’ (1776/1937: 95). Two institutions prevented
China from developing further. One was restriction on foreign trade. ‘A country which neglects or despises foreign
commerce, and which admits the vessels of foreign nations into one or two of its ports only, cannot transact the same
quantity of business which it might do with different laws and institutions’ (1776/1937: 95). This was, perhaps,
understandable, but was still regrettable. ‘A great nation surrounded on all sides by wandering savages and poor
barbarians might, no doubt, acquire riches by the cultivation of its own lands, and by its own interior commerce, but
not by foreign trade. It seems to have been in this manner that the ancient Egyptians and the modern Chinese acquired
their great wealth’ (1776/1937: 462). Limiting foreign trade, however, limited the division of labour, and thereby
limited the growth of income.
Insecure property rights also contributed to China's stationary state. ‘In a country…where, though the rich or the
owners of large capital enjoy a good deal of security, the poor or the owners of small capitals enjoy scarce any, but are
liable, under the pretence of justice, to be pillaged and plundered at any time by the inferior mandarins’,
investment—hence, employment and output—will be less than they might be (1776/1937: 95). The proper function of
the state, in Smith's view, was to establish clear and secure property rights, and the Chinese Empire failed that test.
Smith, thus, explained the low standard of living in China with the same theory that explained the high standard of
living in Europe.
Malthus (1803/1973) is famous for his population theories, and he marshalled them to explain Asian backwardness.
Like Smith, he was impressed by the paradox of a highly productive agriculture and widespread poverty. He attributed
the former to the fertility of the soil and the high standard of cultivation, which reflected state encouragement. This, in
Malthus' view, induced a large population. ‘The population which has arisen naturally from the fertility of the soil, and
the encouragements to agriculture, may be considered as genuine and desirable’ (1803/1973: 131). However, there
were three ‘encouragements to marriage’ that increased the population beyond a reasonable level and ‘which have
caused the immense produce of the country to be divided into very small shares, and have consequently rendered
China more populous, in proportion to its means of subsistence, than perhaps any other country in the world’ (1803/
1973: 128–9). These ‘encouragements’ included (1) ancestor worship, which led parents to have children to secure
sacrifices to themselves after death, (2) ‘prudence, because the children, particularly, the sons, are bound to maintain
their parents’, and (3) infanticide, which allowed parents to rid themselves of children they could not support (1803/
1973: 129). Infanticide was regarded with such abhorrence that its practice was sufficient to conclude that the Chinese
were desperately poor by European standards (Staunton 1797) Malthus applied the same logic to India, where he also believed the standard of living to be very low. He entertained
the prospect that Hindu asceticism would depress fertility (a preventive check) but concluded, ‘from the prevailing
habits and opinions of the people there is reason to believe that the tendency to early marriages was still always
predominant’ (1803/1973: 119). As a result ‘the lower classes of people were reduced to extreme poverty…The
population would thus be pressed hard against the limits of the means of subsistence, and the food of the country
would be meted out to the major part of the people in the smallest shares that could support life’. Disaster was never
far away. ‘India, as might be expected, has in all ages been subject to the most dreadful famines’ (1803/1973: 119).
Marx (1853/1983) was a third great classical economist, and he too, sought to explain Asian backwardness with his
own brand of theory. In a series of newspaper articles, he propounded the highly controversial theory of the ‘Oriental
Mode of Production’. The West, in his view, had grown rapidly since its organization was capitalist. This system gave
businesses maximum incentive to accumulate and innovate. In Asia, however, these incentives were lacking, and that
lack can be traced to geography and the social institutions created to deal with it.
Marx saw ‘irrigation’ as ‘the sine qua non of farming in the East’ (1853/1983: 339) for two reasons. First, there were ‘the
vast tracts of desert, extending from the Sahara, through Arabia, Persia, India and Tartary, to the most elevated Asia
highlands’. These dry lands could be made fertile if water was supplied, so ‘artificial irrigation by canals and
waterworks’ became ‘the basis of Oriental agriculture’. Second, in river valleys ‘as in Egypt and India’ as well as China,
periodic ‘inundations were used for fertilizing the soil’. Water was periodically released on the land, and for that
‘advantage is taken of a high level for feeding irrigative canals’ (1853/1983: 331). Thus, both the potentially fertile
deserts and the rich river valleys required extensive and elaborate water control systems to achieve maximal fertility. In
the West, the need for irrigation or water control ‘drove private enterprise to voluntary association, as in Flanders and
Italy’. However, in Asia, ‘where civilization was too low and the territorial extent too vast to call into life voluntary
association, the interference of the centralizing power of government’ was called into play. The state in Asia took on
the job of administering a vast system of public works, which required a class of civil servants, notably the mandarins
in China.
The state administration of irrigation had two effects, both of which were detrimental to economic growth. First, the
production of agriculture and thus the economy as a whole depended on the performance of the bureaucracy. ‘In
Asian empires we are quite accustomed to see agriculture deteriorating under one government and reviving again
under some other government. There the harvests correspond to good or bad governments, as they change in Europe
with good or bad seasons’ (1853/1983: 332). In Asia, agriculture ‘is not capable of being conducted on the British
principle of free competition, of laissez-faire and laisser-aller’ (1853/1983: 332). The result was a certain passivity since
‘the Hindu…like all Oriental peoples’ left ‘to the central government the care of the great public works, the prime
condition of his agriculture and commerce’ (1853/1983: 333