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The great escape? The contribution of the empire to Portugal’s economic growth, 1500-1800

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  • Costa, Leonor Freire
  • Palma, Nuno
  • Reis, Jaime

Abstract

Newly assembled macroeconomic statistics for early modern Portugal reveal one of Europe’s most vigorous colonial traders and at the same time one of its least successful growth records. Using an estimated model in the spirit of Allen (2009) we conclude that intercontinental trade had a substantial and increasingly positive impact on economic growth. In the heyday of colonial expansion, eliminating the economic links to empire would have reduced Portugal’s per capita income by roughly a fifth. While the empire helped the domestic economy it was not sufficient to annul the tendency towards decline in relation to Europe’s advanced core which set in from the 17th century onwards. We conclude that the explanation for Portugal’s long-term backwardness must be sought primarily in domestic conditions

Suggested Citation

  • Costa, Leonor Freire & Palma, Nuno & Reis, Jaime, 2013. "The great escape? The contribution of the empire to Portugal’s economic growth, 1500-1800," IFCS - Working Papers in Economic History.WH wp13-07, Universidad Carlos III de Madrid. Instituto Figuerola.
    • Handle: RePEc:cte:whrepe:wp13-07
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    Cited by:

    1. Amavilah, Voxi Heinrich, 2017. "The African origins of Euro-American development: Pins on an empirical roadmap," MPRA Paper 79925, University Library of Munich, Germany.
    2. Palma, Nuno & Reis, Jaime, 2019. "From Convergence to Divergence: Portuguese Economic Growth, 1527–1850," The Journal of Economic History, Cambridge University Press, vol. 79(2), pages 477-506, June.
    3. Nuno Palma, 2016. "Sailing away from Malthus: intercontinental trade and European economic growth, 1500–1800," Cliometrica, Journal of Historical Economics and Econometric History, Association Française de Cliométrie (AFC), vol. 10(2), pages 129-149, may.
    4. Leonor Freire Costa & Paulo Brito, 2018. "Why did people pay taxes? Fiscal innovation in Portugal and state making in times of political struggle (1500-1680)," Working Papers GHES - Office of Economic and Social History 2018/59, ISEG - Lisbon School of Economics and Management, GHES - Social and Economic History Research Unit, Universidade de Lisboa.
    5. Jaime Reis, 2016. "The Gross Agricultural Output of Portugal: A Quantitative, Unified Perspective, 1500-1850," Working Papers 0098, European Historical Economics Society (EHES).
    6. Iran F. Machado & Silvia Figueirôa, 2022. "Mining history of Brazil: a summary," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 35(2), pages 253-265, June.
    7. Lains, Pedro, 2016. "Agriculture and Economic Development on the European Frontier : Portugal, 1000-2000," IFCS - Working Papers in Economic History.WH 23463, Universidad Carlos III de Madrid. Instituto Figuerola.
    8. Palma, Nuno & Santiago Caballero, Carlos, 2019. "Patterns of Iberian economic growth in the early modern period," IFCS - Working Papers in Economic History.WH 29185, Universidad Carlos III de Madrid. Instituto Figuerola.
    9. Oleksandra Stoykova, 2021. "The Role of Ex-Colonizer’s Effect in Long-Run Economic Growth," European Research Studies Journal, European Research Studies Journal, vol. 0(2), pages 274-293.

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    More about this item

    Keywords

    The European Little Divergence;

    JEL classification:

    • N70 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - General, International, or Comparative
    • N74 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Europe: 1913-
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
    • N13 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: Pre-1913
    • N10 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - General, International, or Comparative

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