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Unified China and Divided Europe

Listed author(s):
  • Ko, Chiu Yu
  • Koyama, Mark
  • Sng, Tuan-Hwee

This paper studies the causes and consequences of political centralization and fragmentation in China and Europe. We argue that the severe and unidirectional threat of external invasion fostered political centralization in China while Europe faced a wider variety of moderate external threats and remained politically fragmented. Our model allows us to explore the economic consequences of political centralization and fragmentation. Political centralization in China led to lower taxation and hence faster population growth during peacetime than in Europe. But it also meant that China was relatively fragile in the event of an external invasion. Our results are consistent with historical evidence of violent conflicts, tax levels, and population growth in both China and Europe.

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File URL: http://hermes-ir.lib.hit-u.ac.jp/rs/bitstream/10086/28270/1/wp2014-7.pdf
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Paper provided by Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University in its series CEI Working Paper Series with number 2014-7.

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Length: 39 p.
Date of creation: Jun 2014
Handle: RePEc:hit:hitcei:2014-7
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Phone: 042-580-8405
Fax: 042-580-8333
Web page: http://cei.ier.hit-u.ac.jp/
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