Advanced Search
MyIDEAS: Login to save this article or follow this journal

Why the West got Rich Before Other Countries and Why China is Catching Up With the West Today? New Answer to the Old Question

Contents:

Author Info

  • Popov, V.

    (Graduate School of International Business of the Russian Presidential Academy of National Economy and Public Administration, Moscow, Russia)

Abstract

The goal of this paper is to offer a non-technical interpretation of the "Great Divergence" and "Great Convergence" stories. After reviewing existing explanations in the literature, I propose a different interpretation. Western countries exited the Malthusian trap by destroying traditional institutions, which was associated with an increase in income inequality and even a decrease in life expectancy, but allowed the redistribution of income in favor of savings and investment at the expense of consumption. When the same pattern was imposed on some developing countries (colonialism - Sub-Sahara Africa, Latin America, and the former Soviet Union), it resulted in the destruction of traditional institutions, increase of income inequality, and worsening of starting positions for catch-up development. Other developing countries - East Asia, South Asia, the Middle East and North Africa - that were less affected by colonialism, managed to retain traditional institutions and by the end of the XX century found themselves in a better starting position for modern economic growth. The slow-going technical progress finally allowed them to find another exit from the Malthusian trap - increased income that permitted the share of investment in GDP to rise without a major increase in income inequality and decrease in life expectancy.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.econorus.org/repec/journl/2012-15-35-64r.pdf
Download Restriction: no

Bibliographic Info

Article provided by New Economic Association in its journal Journal of the New Economic Association.

Volume (Year): 15 (2012)
Issue (Month): 3 ()
Pages: 35-64

as in new window
Handle: RePEc:nea:journl:y:2012:i:15:p:35-64

Contact details of provider:
Postal: Nakhimovsky prospekt, 32, Office 1115, 117218 Moscow Russia
Phone: +7 495 7189855
Fax: +7 495 7189855
Email:
Web page: http://www.econorus.org/english.phtml
More information through EDIRC

Related research

Keywords: economic history; rates of economic growth; gap in per capital GDP between countries; the West; developing countries; China;

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Michael Faye & John McArthur & Jeffrey Sachs & Thomas Snow, 2004. "The Challenges Facing Landlocked Developing Countries," Journal of Human Development and Capabilities, Taylor & Francis Journals, vol. 5(1), pages 31-68.
  2. David N. Weil & Oded Galor, 2000. "Population, Technology, and Growth: From Malthusian Stagnation to the Demographic Transition and Beyond," American Economic Review, American Economic Association, vol. 90(4), pages 806-828, September.
  3. Williamson, Jeffrey G., 2009. "History without evidence: Latin American inequality since 1491," Center for European, Governance and Economic Development Research Discussion Papers 81, University of Goettingen, Department of Economics.
  4. Popov, Vladimir, 2011. "Developing new measurements of State institutional capacity," MPRA Paper 32389, University Library of Munich, Germany.
  5. Dani Rodrik & Arvind Subramanian & Francesco Trebbi, 2002. "Institutions Rule: The Primacy of Institutions over Geography and Integration in Economic Development," NBER Working Papers 9305, National Bureau of Economic Research, Inc.
  6. Daron Acemoglu & Simon Johnson & James A. Robinson, 2000. "The Colonial Origins of Comparative Development: An Empirical Investigation," NBER Working Papers 7771, National Bureau of Economic Research, Inc.
  7. Maddison, Angus, 1992. " A Long-Run Perspective on Saving," Scandinavian Journal of Economics, Wiley Blackwell, vol. 94(2), pages 181-96.
  8. Ronald Findlay & Kevin H. O'Rourke, 2007. "Power and Plenty: Trade, War and the World Economy in the Second Millennium (Preface)," Trinity Economics Papers tep0107, Trinity College Dublin, Department of Economics.
  9. Arvind Subramanian, 2011. "Eclipse: Living in the Shadow of China's Economic Dominance," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 6062.
  10. Jeffrey G. Williamson, 2009. "History without Evidence: Latin American Inequality since 1491," Courant Research Centre: Poverty, Equity and Growth - Discussion Papers 3, Courant Research Centre PEG.
  11. Gregory Clark, 2007. "Introduction to A Farewell to Alms: A Brief Economic History of the World
    [A Farewell to Alms: A Brief Economic History of the World]
    ," Introductory Chapters, Princeton University Press.
  12. Jeffrey G. Williamson, 2009. "History without Evidence: Latin American Inequality since 1491," NBER Working Papers 14766, National Bureau of Economic Research, Inc.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:nea:journl:y:2012:i:15:p:35-64. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Alexey Tcharykov).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.