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The Rise of Europe: Atlantic Trade, Institutional Change, and Economic Growth

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  • Daron Acemoglu
  • Simon Johnson
  • James Robinson

Abstract

The rise of Western Europe after 1500 is due largely to growth in countries with access to the Atlantic Ocean and with substantial trade with the New World, Africa, and Asia via the Atlantic. This trade and the associated colonialism affected Europe not only directly, but also indirectly by inducing institutional change. Where "initial" political institutions (those established before 1500) placed significant checks on the monarchy, the growth of Atlantic trade strengthened merchant groups by constraining the power of the monarchy, and helped merchants obtain changes in institutions to protect property rights. These changes were central to subsequent economic growth.

Suggested Citation

  • Daron Acemoglu & Simon Johnson & James Robinson, 2005. "The Rise of Europe: Atlantic Trade, Institutional Change, and Economic Growth," American Economic Review, American Economic Association, vol. 95(3), pages 546-579, June.
  • Handle: RePEc:aea:aecrev:v:95:y:2005:i:3:p:546-579
    Note: DOI: 10.1257/0002828054201305
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    More about this item

    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • F10 - International Economics - - Trade - - - General

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