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Global Economic History: A Very Short Introduction (2011)

por Robert C. Allen

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The gap between the rich and the poor can be vast. Robert C. Allen considers the main factors that contribute to this gap looking at the interconnections between economic growth culture, technology, and income distribution.
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Well, What would you expect from a book that promises it is a very short introduction to a very complex subject? Of course he doesn't cover everything and I looked in vain for some story about the economic development of Australia. However, he does cover a wide range of countries and economic developments. My impression of Allen is that he has a "go-to" bag of economic planks and he tends to force-fit all the economies covered to those economic planks. Education is a main one and I can't argue with that . The consolidation of political groups to forma single cohesive market is another plank...and, again, I can't argue with that. The other planks are transport (especially railways), investment finance houses, and the iron industry. I wonder if he gives enough credit to dumb luck. The fact that both Malaysia, Saudi Arabia and Mexico found they had large reserves of oil completely changed the outlook for them. (In all cases, the oil was found by the large oil companies and, in all cases, it was nationalised and profits funnelled into domestic development. (Despite frenzied opposition by the oil companies and their Governments ...notably, the US, UK and Dutch.
He does draw attention to the fact that where "western" technology and machinery were imported and not adapted to local conditions, then things often didn't work out all that well. But where adaptations were made locally (as in Japan) then there was much greater success and the local innovators had developed a skill set which could be re-applied elsewhere. I do think he missed the role of German Chemists from the textile-dye industry in the economic development of Germany and the establishment of firms that are still giants today (such as Bayer AG)...he does mention it but its mainly in relation to the Haber process of making nitrogenous fertilisers.
But overall, I think it certainly does what it sets out to do. Give a reasonable picture of economic development (world wide) yet do it in a very compact and easily readable form. Four stars from me. ( )
  booktsunami | Mar 14, 2024 |
Everybody knows the fight was fixed
The poor stay poor, the rich get rich
That's how it goes…Everybody knows.

—Leonard Cohen

Economics is a frustrating subject, managing to be both essential and eye-wateringly dull. This primer does a decent job of distilling its subject into one basic question – why the world is so unequal – and of holding your attention long enough to sketch the outlines of an answer.

Normally with such things there is a lot of hemming and hawing, bet-hedging, and phrases like ‘remains to be seen’; here, refreshingly, Allen is relatively clear and unambiguous about how things came about (though less so on how they should be fixed). There is much discussion of economic policy, but plainly geographical luck had a lot to do with it – and once some economic development gets underway, it becomes a self-fuelling engine as technology substitutes for, and drives, higher wages.

This is why the technologies developed by the industrialised West can't just be imported into developing countries – they only make economic sense when workers are paid so much that investing in machines instead becomes an appealing prospect.

Western technology in the 21st century uses vast amounts of capital per worker. It only pays to substitute that much capital for labour when wages are high relative to capital costs.

And the technology brings with it newer, more specialised jobs, which in turn bring higher wages, which in turn prompts further R&D into technology that will make them obsolete…. Hence the Industrial Revolution – and other ‘industrial revolutions’ since – were the result, not just the cause, of high salaries, and countries who don't get started are stuck in a poverty trap.

Especially interesting is the discussion in the last chapter about those few countries that did manage to catch up with the West – namely Japan, South Korea, and in part the Soviet Union. China will undoubtedly join this group any second now. The only way this could be done was to construct all the elements of an advanced industrialised economy all at once – steel mills, car factories, cities, all erected as an act of will on the grounds that they would eventually all need each other. This is ‘big push’ industrialisation, but it is hardly an option for many countries, especially those still suffering the deleterious hangovers of colonialism.

You finish something like this with a lot of questions, but they are at least more specific than the questions you had going in – or that's the hope, anyway. At the very least there's enough in here to arm you against the next Jared Diamond fanatic you find yourself stuck in an elevator with. ( )
2 vote Widsith | Sep 20, 2018 |
An excellent introduction and recap. ( )
  JohnPhelan | Nov 9, 2015 |
El punto de partida de esta breve introducción a la “Historia económica mundial” es la pregunta clásica de por qué ciertos países son ricos y otros pobres. ¿Por qué es Europa, y no Asia o África, la región en la que el crecimiento económico despega en primera instancia, cuando, hasta comienzos del siglo XVI, la situación de prosperidad de distintos países en diversas regiones era muy parecida? Tras dividir la historia moderna en tres períodos, Robert C. Allen concluye que el desarrollo económico en Europa Occidental y América del Norte se basó en la creación de mercados nacionales unificados, el funcionamiento de aranceles externos, la promoción de bancos que estabilizaban la moneda e invertían en la industria, y la extensión del sistema educativo de masas
  dani.casanueva | Jan 23, 2014 |
A modest proposal: Let's take every politician in the world and lock them up until they finish reading this book twice.

Economics is simply too complicated to summarize in a book this short, and it shows. There are places where the author must simply dogmatically assert certain points, and others where he cannot document in full. There are a lot of situations he can't cover.

But that's kind of the point: To make the situation simple enough to be clear -- and then one can start fiddling around the edges. This book makes a number of points very well. For instance, it makes a good argument for suiting a group's (nation's, company's) products to its resources -- of capital, cheap or expensive labor, etc.

This is anathema to a lot of people today. Conservatives won't like the fact that it shows that governments can help make the economy more efficient -- by promoting education and infrastructure, by creating a stable financial system, and (when needed) by encouraging certain industries. But liberals may not like the fact that the government cannot, just by fiat, make all this work. It really is a matter of "appropriate technology" -- mostly a liberal idea, but one from which conservatives can also gain wisdom.

This is, of course, not a book for advanced economists. But it is a very interesting little read for those who want a brief overview and some basic concepts. ( )
  waltzmn | Mar 20, 2012 |
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