Preindustrial economic growth: Ca. 1270-1820

Abstract

This chapter presents an overview of the current state of the art regarding the trends and causes of preindustrial economic growth in Western Europe between ca. 1270 and 1820. In doing so, the chapter introduces measures of living standards - i.e., real wages and per capita GDP. The Low Countries and England showed more or less stable real wages after the increase in wages in the fourteenth century following the Black Death, whereas real wages elsewhere in Europe declined in the long run. This "Little Divergence" between the North Sea area and the rest of the continent is also evident from estimates on per capita GDP. On the continent, per capita GDP stagnated or declined, whereas Holland and England showed a lot of progress - they were substantially richer in 1750 than in 1500. There were two key developments in this process. The first is the Black Death, which increased living standards in the countries bordering the North Sea regions due to well-functioning labor and capital markets. The second is the shift to premodern economic growth following the Black Death. The chapter summarizes the causes of the vast increases in living standards in the North Sea region between 1348 and 1820, including human capital formation and international trade.