Economic inequality and growth before the industrial revolution: A case study of the Low Countries (14th-19th centuries)

This paper studies a collection of data on economic inequality in fifteen towns in the Southern and Northern Low Countries from the late Middle Ages until the end of the nineteenth century. By using a single and consistent source type and adopting a uniform methodology, it is possible to study levels of urban economic inequality across time and place comparatively. The results indicate a clear growth in economic inequality in the two centuries prior to the industrial revolution and the onset of sustained economic growth per capita. The general occurrence of this rise throughout regions with dissimilar economic trajectories contradicts the existence of a straightforward trade-off between growth and inequality as conjectured by Simon Kuznets (1955). Instead, the results presented lend support to the ‘classical’ economists’ explanation of inequality as the consequence of a changing functional distribution of income favouring capital over labour in the long run.