Lesson 1: The Origins of the Great Divergence Debate

The Great Divergence Debate is a central topic in economic history, and it refers to the question of why some countries became rich while others remained poor. The debate centers around the period from the 18th century onwards, when some Western European countries began to experience rapid economic growth and technological advancement, while other regions such as Asia and Africa lagged behind. In this lesson, we will explore the historical context and key questions that have shaped the Great Divergence Debate in Economic History. We will examine the different theories that have been proposed to explain this phenomenon, and consider the evidence for and against each theory.

Historical Context

The origins of the Great Divergence Debate can be traced back to the late 19th century, when scholars began to notice the stark differences in economic development between Western Europe and other regions of the world. This led to the development of various theories that attempted to explain why some countries became rich while others remained poor. These theories were heavily influenced by the prevailing political and economic ideologies of the time, and they continue to shape the debate today.

Key Questions

The Great Divergence Debate is centered around several key questions:

• Why did some countries experience rapid economic growth and technological advancement while others did not?
• What role did institutions, culture, geography, and other factors play in shaping economic development?
• How do we measure economic development and compare it across different regions and time periods?

Theories of Economic Development

There are several theories that have been proposed to explain the Great Divergence, each with its own strengths and weaknesses. Some of the most prominent theories include:

• Geography and Climate: This theory argues that the natural resources and climate of a region play a key role in determining its economic development. For example, regions with abundant natural resources such as coal and iron were able to develop advanced manufacturing industries, while regions with poor soil and harsh climates were unable to do so.

• Institutions: This theory argues that the quality of a country's institutions, such as its legal system, property rights, and governance, is a key determinant of economic development. Countries with strong institutions are better able to attract investment, protect property rights, and promote innovation and entrepreneurship.

• Culture: This theory argues that cultural factors such as values, beliefs, and norms can influence economic development. For example, some cultures may place a greater emphasis on education and hard work, which can lead to higher levels of productivity and innovation.

• Technology: This theory argues that advances in technology are the primary driver of economic growth and development. Countries that are able to develop and adopt new technologies are better able to increase productivity and compete in the global economy.

Conclusion

The Great Divergence Debate is a complex and multifaceted topic that continues to be the subject of much academic research and debate. By examining the different theories that have been proposed to explain why some countries became rich while others remained poor, we can gain a better understanding of the historical forces that have shaped our modern world.

Further Reading

• Acemoglu, Daron, and James A. Robinson. Why Nations Fail: The Origins of Power, Prosperity, and Poverty. Crown Business, 2012.
• Pomeranz, Kenneth. The Great Divergence: China, Europe, and the Making of the Modern World Economy. Princeton University Press, 2000.
• Maddison, Angus. Contours of the World Economy 1-2030 AD: Essays in Macro-Economic History. Oxford University Press, 2007.

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