Jan Luiten van Zanden has devoted his career to reconstruct the historical development of global inequality, and to find out why certain countries, such as The Netherlands, have been relatively successful, whereas others, for example Indonesia, lagged behind. He first of all focused on reconstructing the ‘facts’: how did welfare develop in the very long run in the various parts of the world economy. Part of this research went back to the Middle Ages, when the first foundations for Western prosperity were laid. Next, he aims to explain the long term trends in the world economy making use of recent theoretical insights into the drivers of development. In this recent work he stresses the role played by (female) agency in economic development (via, for example, the decisions taken by women about fertility and human capital formation) and of institutions which make it possible to share power and restrain the executive (for example in his – together with Maarten Prak - book on the Pioneers of Capitalism). He moreover plays a central role in the international research on global economic history, as former president of the International Economic History Association, and as organizer of Clio Infra, a large research project aimed to reconstruct the long-term evolution of global inequality. A spin off of this project was the OECD report How was Life? Global Well-Being since 1820, published in 2014, in which a historical perspective is added to the \’GDP and beyond’ debate. He recently also published about the long term history of biodiversity and the interactions between nature and society.
The experiment with a Cobb Douglas production function was carried out for Italy, and for Western... more The experiment with a Cobb Douglas production function was carried out for Italy, and for Western Europe as a whole. For Italy one have the point estimates of gross domestic product (GDP) and population by Malanima. The three countries this appendix has concentrated on so far, are all rather exceptional: Italy because of its strong long-term decline, Holland and England because of their dynamic development. In between these two extremes were the other European countries, of which the GDP per capita may not have changed very much between 1500 and 1800. The long term development of European wages seems to follow a path that can be simulated by a Cobb Douglas production function assuming no technological change and a very low level of new capital formation; the different phases of population growth then produce the pattern estimated by Allen.Keywords: Cobb Douglas production function; Italy; Western Europe
This chapter reconstructs the development of gross domestic product (GDP) per capita in the long ... more This chapter reconstructs the development of gross domestic product (GDP) per capita in the long term, on the basis of several benchmark estimates mainly derived from work by other authors. This will be combined with a simulation procedure to estimate the annual development of GDP per capita, based on a Cobb Douglas production function. The debate about the pace of economic growth in the early modern period emerged in the 1990s. The chapter presents an update on the research carried out recently, focusing mainly on the countries bordering the North Sea: England and Holland. It discusses modern economic growth - a sustained increase in GDP per capita made possible by technological change and accompanied by structural transformation of the economy - began in the seventeenth century in the North Sea region, most clearly in England, where it continued during the eighteenth century, but came to a halt in the Netherlands.Keywords: early modern period; economic growth; gross domestic product (GDP); North Sea region
This investigation of the banking crises experienced in 12 European industrial countries and the ... more This investigation of the banking crises experienced in 12 European industrial countries and the USA attempts to establish a common pattern and to identify explanations for the timing and occurrence of the crises. The authors find that all crises occurred during years of deflation, but not every deflationary shock led to a run on the banks. In their view, the reasons why banks in some countries were vulnerable to such shocks, and others were not, are closely related to the differing degrees of inflation experienced during and just after the First World War. The conclusion drawn from the study is that the poor quality of the banks’ assets and the reduction in the liquidity associated with the increased commitments to industry were a leading cause of banking crises, but that nevertheless this lending had been a rational policy for the banks in countries that had suffered rapid inflation during and after the war.
This chapter investigates one aspect of this hypothesis: the remuneration of human capital. It te... more This chapter investigates one aspect of this hypothesis: the remuneration of human capital. It tests whether Western Europe really had a comparative advantage in knowledge-intensive sectors by examining the long-term development of the skill premium in different parts of Europe and the most developed parts of Asia. It focuses on one particular skill premium that one knows a great deal about: the difference in daily wages between skilled craft smen (carpenters and masons) and unskilled labourers in the construction industry, and offers some additional information on the skill premium in other trades. The standard explanation for the negative link between wage inequality and level of economic development is that the supply of human capital increased more rapidly than did demand for it in the process of modern economic growth, as would be expected on the basis of new growth theory.Keywords: human capital; modern economic growth; skill premium; Western Europe
Europe lagged behind other centres of civilization such as the Middle East, where a new wave of e... more Europe lagged behind other centres of civilization such as the Middle East, where a new wave of economic dynamism was unleashed by Islam, and China, where under the Sung, the empire was experiencing an unprecedented economic boom. Eight hundred years later, there is no doubt that Western Europe had become the most dynamic part of the world economy. But was it also more prosperous than China or Japan, or did the 'Great Divergence' only occur after 1800? The chapter addresses this and other such questions. It also focuses on the consequences of different sets of institutions for long-term economic growth. The comparison between Western Europe on the one hand, and the Arab World and China on the other hand, suggests that the Latin West, after having been a marginal part of the world economy before 1000, was able to catch up quickly during the High Middle Ages.Keywords: Arab World; China; Japan; Western Europe
This is the conclusory chapter of the book, which attempts to sketch the genesis and longterm tra... more This is the conclusory chapter of the book, which attempts to sketch the genesis and longterm trajectory of institutions that for the most part arose during the high Middle Ages in Western Europe. The concept of citizenship also formed the basis for a reinterpretation of the relationship between the nation state and its inhabitants, which began in England in the middle decades of the seventeenth century, and would form the basis for the 'Atlantic Revolution' of the post-1776 period. The big wave of institutional design of the 10th-13th centuries occurred in a political vacuum resulting from the disintegration of the Carolingian empire, and more generally, the weakness of earlier, Greek-Roman traditions. The high Middle Ages were arguably the most dynamic and innovative period before 1800, when almost all parts of Western Europe went through a process of radical economic change.Keywords: Atlantic Revolution; Carolingian empire; Middle Ages; Western Europe
Economic growth, especially the 'modern economic growth' that is based on sustained incre... more Economic growth, especially the 'modern economic growth' that is based on sustained increases in total factor productivity, is ultimately based on the accumulation of knowledge. This chapter discusses the growth of human capital and knowledge by focusing on trends in the centuries leading up to the industrial revolution. It focuses on Joel Mokyr's interpretation of the long-term causes of the industrial revolution as the result of new technology, which was driven by the development of a 'knowledge society' in Western Europe in this period. The chapter analyzes three interrelated processes- the decline of the skill premium of common workmen, the fall in book prices, and the rise of literacy - were concentrated in one part of Europe, the Low Countries and Great Britain. Southern Europe and parts of Central Europe dropped behind aft er the sixteenth century, and Eastern Europe continued to lag throughout.Keywords: economic growth; industrial revolution; knowledge society; skill premium; Western Europe
One way to approach the problem with making more direct comparisons between China and Europe is t... more One way to approach the problem with making more direct comparisons between China and Europe is to try to fit China (or parts of China) in a model used for estimating gross domestic product (GDP) per capita in pre-industrial Europe, which took data on the structure of the labour force and the level of real wages to estimate the level and development of GDP per capita from 1500 to 1800. The problem with making more direct comparisons between China and Europe using the established method of estimating income levels and PPPs is the scarcity of price information on China. One way to circumvent this is to use rice as a standard for comparison. Per capita GDP in Java from 1815 to 1835 was on average the equivalent of 490 kg of rice, which gives an indication of the large gap between ?underdeveloped" Java and the ?developed" Yangtze Delta.Keywords: China; gross domestic product (GDP) per capita; pre-industrial Europe
The experiment with a Cobb Douglas production function was carried out for Italy, and for Western... more The experiment with a Cobb Douglas production function was carried out for Italy, and for Western Europe as a whole. For Italy one have the point estimates of gross domestic product (GDP) and population by Malanima. The three countries this appendix has concentrated on so far, are all rather exceptional: Italy because of its strong long-term decline, Holland and England because of their dynamic development. In between these two extremes were the other European countries, of which the GDP per capita may not have changed very much between 1500 and 1800. The long term development of European wages seems to follow a path that can be simulated by a Cobb Douglas production function assuming no technological change and a very low level of new capital formation; the different phases of population growth then produce the pattern estimated by Allen.Keywords: Cobb Douglas production function; Italy; Western Europe
This chapter reconstructs the development of gross domestic product (GDP) per capita in the long ... more This chapter reconstructs the development of gross domestic product (GDP) per capita in the long term, on the basis of several benchmark estimates mainly derived from work by other authors. This will be combined with a simulation procedure to estimate the annual development of GDP per capita, based on a Cobb Douglas production function. The debate about the pace of economic growth in the early modern period emerged in the 1990s. The chapter presents an update on the research carried out recently, focusing mainly on the countries bordering the North Sea: England and Holland. It discusses modern economic growth - a sustained increase in GDP per capita made possible by technological change and accompanied by structural transformation of the economy - began in the seventeenth century in the North Sea region, most clearly in England, where it continued during the eighteenth century, but came to a halt in the Netherlands.Keywords: early modern period; economic growth; gross domestic product (GDP); North Sea region
This investigation of the banking crises experienced in 12 European industrial countries and the ... more This investigation of the banking crises experienced in 12 European industrial countries and the USA attempts to establish a common pattern and to identify explanations for the timing and occurrence of the crises. The authors find that all crises occurred during years of deflation, but not every deflationary shock led to a run on the banks. In their view, the reasons why banks in some countries were vulnerable to such shocks, and others were not, are closely related to the differing degrees of inflation experienced during and just after the First World War. The conclusion drawn from the study is that the poor quality of the banks’ assets and the reduction in the liquidity associated with the increased commitments to industry were a leading cause of banking crises, but that nevertheless this lending had been a rational policy for the banks in countries that had suffered rapid inflation during and after the war.
This chapter investigates one aspect of this hypothesis: the remuneration of human capital. It te... more This chapter investigates one aspect of this hypothesis: the remuneration of human capital. It tests whether Western Europe really had a comparative advantage in knowledge-intensive sectors by examining the long-term development of the skill premium in different parts of Europe and the most developed parts of Asia. It focuses on one particular skill premium that one knows a great deal about: the difference in daily wages between skilled craft smen (carpenters and masons) and unskilled labourers in the construction industry, and offers some additional information on the skill premium in other trades. The standard explanation for the negative link between wage inequality and level of economic development is that the supply of human capital increased more rapidly than did demand for it in the process of modern economic growth, as would be expected on the basis of new growth theory.Keywords: human capital; modern economic growth; skill premium; Western Europe
Europe lagged behind other centres of civilization such as the Middle East, where a new wave of e... more Europe lagged behind other centres of civilization such as the Middle East, where a new wave of economic dynamism was unleashed by Islam, and China, where under the Sung, the empire was experiencing an unprecedented economic boom. Eight hundred years later, there is no doubt that Western Europe had become the most dynamic part of the world economy. But was it also more prosperous than China or Japan, or did the 'Great Divergence' only occur after 1800? The chapter addresses this and other such questions. It also focuses on the consequences of different sets of institutions for long-term economic growth. The comparison between Western Europe on the one hand, and the Arab World and China on the other hand, suggests that the Latin West, after having been a marginal part of the world economy before 1000, was able to catch up quickly during the High Middle Ages.Keywords: Arab World; China; Japan; Western Europe
This is the conclusory chapter of the book, which attempts to sketch the genesis and longterm tra... more This is the conclusory chapter of the book, which attempts to sketch the genesis and longterm trajectory of institutions that for the most part arose during the high Middle Ages in Western Europe. The concept of citizenship also formed the basis for a reinterpretation of the relationship between the nation state and its inhabitants, which began in England in the middle decades of the seventeenth century, and would form the basis for the 'Atlantic Revolution' of the post-1776 period. The big wave of institutional design of the 10th-13th centuries occurred in a political vacuum resulting from the disintegration of the Carolingian empire, and more generally, the weakness of earlier, Greek-Roman traditions. The high Middle Ages were arguably the most dynamic and innovative period before 1800, when almost all parts of Western Europe went through a process of radical economic change.Keywords: Atlantic Revolution; Carolingian empire; Middle Ages; Western Europe
Economic growth, especially the 'modern economic growth' that is based on sustained incre... more Economic growth, especially the 'modern economic growth' that is based on sustained increases in total factor productivity, is ultimately based on the accumulation of knowledge. This chapter discusses the growth of human capital and knowledge by focusing on trends in the centuries leading up to the industrial revolution. It focuses on Joel Mokyr's interpretation of the long-term causes of the industrial revolution as the result of new technology, which was driven by the development of a 'knowledge society' in Western Europe in this period. The chapter analyzes three interrelated processes- the decline of the skill premium of common workmen, the fall in book prices, and the rise of literacy - were concentrated in one part of Europe, the Low Countries and Great Britain. Southern Europe and parts of Central Europe dropped behind aft er the sixteenth century, and Eastern Europe continued to lag throughout.Keywords: economic growth; industrial revolution; knowledge society; skill premium; Western Europe
One way to approach the problem with making more direct comparisons between China and Europe is t... more One way to approach the problem with making more direct comparisons between China and Europe is to try to fit China (or parts of China) in a model used for estimating gross domestic product (GDP) per capita in pre-industrial Europe, which took data on the structure of the labour force and the level of real wages to estimate the level and development of GDP per capita from 1500 to 1800. The problem with making more direct comparisons between China and Europe using the established method of estimating income levels and PPPs is the scarcity of price information on China. One way to circumvent this is to use rice as a standard for comparison. Per capita GDP in Java from 1815 to 1835 was on average the equivalent of 490 kg of rice, which gives an indication of the large gap between ?underdeveloped" Java and the ?developed" Yangtze Delta.Keywords: China; gross domestic product (GDP) per capita; pre-industrial Europe
Pre-modern growth was to a large extent dependent on processes of commercialization and specializ... more Pre-modern growth was to a large extent dependent on processes of commercialization and specialization, based on cheap transport. Seminal interpretations of the process of economic growth before the Industrial Revolution have pointed to the strategic importance of the rise of the Atlantic economy and the growth of cities linked to this, but have not really explained why Europeans were so efficient in organizing large international networks of shipping and trade. Most studies concerning early modern shipping have focused on changes in ship design (capital investments) in explaining long-term performance of European shipping in the pre-1800 period; in this paper we argue that this is only part of the explanation. Human capital – the quality of the labour force employed on ships – mattered as well. We firstly demonstrate that levels of human capital on board European ships were relatively high, and secondly that there were powerful links between the level of labour productivity in shipping and the quality of the workforce. This suggests strongly that shipping was a 'high tech' industry not only employing high quality capital goods, but also, as a complementary input, high quality labour, which was required to operate the increasingly complex ships and their equipment.
Markets for labour, land and capital play important roles in the longterm
evolution of economies... more Markets for labour, land and capital play important roles in the longterm
evolution of economies. In the course of recent centuries, the exchange
of land, labour and capital by way of the market – whereby prices
are mainly determined by supply and demand – has become ever more
important. These exchanges increasingly replaced other systems of exchange and allocation, such as those by way of tribute, voluntary redistribution or systems applying some type of coercion, as in the manorial
system. This rise of what are termed ‘factor markets ’, occurring most
conspicuously in Western Europe, has had profound effects on economic
development. Most economic historians – whether from neo-classical,
neo-institutionalist or neo-Marxist schools – would agree that mobility of
factors of production, specialization and technological change are often
linked with, or promoted by, the rise of wage labour, land leases and
large-scale loans and investments, and the concomitant market competition.
The growth of factor markets is a not a unilinear process, however,
but one fraught with stagnation, crises and even the reversal of trends.
Moreover, the process displays striking regional differences.
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Papers by Jan Luiten van Zanden
evolution of economies. In the course of recent centuries, the exchange
of land, labour and capital by way of the market – whereby prices
are mainly determined by supply and demand – has become ever more
important. These exchanges increasingly replaced other systems of exchange and allocation, such as those by way of tribute, voluntary redistribution or systems applying some type of coercion, as in the manorial
system. This rise of what are termed ‘factor markets ’, occurring most
conspicuously in Western Europe, has had profound effects on economic
development. Most economic historians – whether from neo-classical,
neo-institutionalist or neo-Marxist schools – would agree that mobility of
factors of production, specialization and technological change are often
linked with, or promoted by, the rise of wage labour, land leases and
large-scale loans and investments, and the concomitant market competition.
The growth of factor markets is a not a unilinear process, however,
but one fraught with stagnation, crises and even the reversal of trends.
Moreover, the process displays striking regional differences.