Political Institution and Long Run Economic Trajectory: Some Lessons from Two Millennia of Chinese Civilization
AbstractBased on a reconstruction of a weighted index of political unification and a time series of incidences of warfare for the past two millennia, this paper develops a narrative to show that the establishment and consolidation towards a single unitary monopoly of political power in China was an endogenous historical process. Drawing on new institutional economics, this article develops a historical narrative to demonstrate that monopoly rule, a long time-horizon and the large size of the empire could give rise to a path of low-taxation and dynastic stability co-evolving with the growth of a private sector under China’s imperial system. But the fundamental problems of incentive misalignment and information asymmetry within its centralized and hierarchical political structure also placed limits to institutional change necessary for modern economic growth.
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Bibliographic InfoPaper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 8791.
Date of creation: Jan 2012
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- H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
- N4 - Economic History - - Government, War, Law, International Relations, and Regulation
- O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
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- NEP-ALL-2012-03-28 (All new papers)
- NEP-HIS-2012-03-28 (Business, Economic & Financial History)
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- Loren Brandt & Debin Ma & Thomas G. Rawski, 2013.
"From divergence to convergence: re-evaluating the history behind China’s economic boom,"
Economic History Working Papers
50816, London School of Economics and Political Science, Department of Economic History.
- Loren Brandt & Debin Ma & Thomas G. Rawski, 2014. "From Divergence to Convergence: Reevaluating the History behind China's Economic Boom," Journal of Economic Literature, American Economic Association, vol. 52(1), pages 45-123, March.
- Loren Brandt & Debin Ma & Thomas G. Rawski, 2012. "From Divergence to Convergence: Re-evaluating the History Behind China's Economic Boom," Global COE Hi-Stat Discussion Paper Series gd11-217, Institute of Economic Research, Hitotsubashi University.
- Loren Brandt & Debin Ma & Thomas G. Rawski, 2012. "From divergence to convergence: re-evaluating the history behind China’s economic boom," Economic History Working Papers 41660, London School of Economics and Political Science, Department of Economic History.
- Brandt, Loren & Ma, Debin & Rawski, Thomas, 2013. "From Divergence to Convergence: Re-evaluating the History Behind China’s Economic Boom," CAGE Online Working Paper Series 117, Competitive Advantage in the Global Economy (CAGE).
- Qiang Chen, 2014. "Natural Disasters, Ethnic Diversity, and the Size of Nations: Two Thousand Years of Unification and Division in Historical China," SDU Working Papers 2014-01, School of Economics, Shandong University.
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