European goods market integration in the very long run: from the Black Death to the First World War

The paper examines price convergence and increases in the efficiency of wheat markets across Europe from the mid-fourteenth to the early twentieth century. The analysis is based on a new data set of prices from more than 500 markets. Unlike previous research, we find that convergence was a predominantly pre-modern phenomenon. It started in the late fifteenth and reached a first high point in the early seventeenth century - a level of integration that was surpassed only in the nineteenth century. In terms of market integration, the ‘little divergence’ between parts of North-Western Europe and the rest of the continent appears since about 1600. Long-term improvements in market efficiency began in the early sixteenth century, with advances being temporarily as uneven as in price convergence. We trace this to uneven institutional change and the non-synchronous spread of modern media and systems of information transmission that affected the ability of merchants to react to news.