Must-read: Emanuele Felice: “The Challenges of Updating the Contours of the World Economy”

Must-Read: Emanuele Felice (2014): The Challenges of Updating the Contours of the World Economy: “Re-estimating Growth Before 1820 by Jutta Bolt… and Jan Luiten van Zanden (Utrecht University…

…provide[s] an inventory while also critically review the available research… classifying Maddison’s estimates in four groups: a) official estimates… b) historical estimates (that is, estimates produced by economic historians) which roughly follow the same method as the official ones and are based on a broad range of data and information; c) historical estimates based on indirect proxies… d) ‘guess estimates’….

The pre-industrial era (‘c’ kind estimates). For Europe, we now have a considerable amount of new work… from 1000 to 1800 AD, growth was probably more gradual than what proposed by Maddison; that is, European GDP was significantly higher in the Renaissance (above 1000 PPP 1990 dollars in 1500, against 771 proposed by Maddison); hence, growth was slower in the following three centuries (1500-1800), while faster in the late middle ages (1000-1500). For Asia, the new (and in some cases very detailed) estimates available for some regions of India (Bengal) and China (the Yangzi Delta), for Indonesia and Java, and for Japan, confirm Maddison’s view of the great divergence, against Pomeranz revisionist approach: in the late eighteenth and early nineteenth century, a significant gap between Europe and Asia was already present…. New long-run estimates are presented also for the Near East, as well as for the Roman world…. The authors also signal the presence of estimates for ancient Mesopotamia… a bit below that of the Roman empire (600 PPP 1990 dollars per year, versus 700), but they are not included in the dataset….

As pointed out by Gregory Clark, in his 2009 Review of Maddison’s famous Contours of the World Economy:

All the numbers Maddison estimates for the years before 1820 are fictions, as real as the relics peddled around Europe in the Middle Ages […] Just as in the Middle Ages, there was a ready market for holy relics to lend prestige to the cathedrals and shrines of Europe […], so among modern economists there is a hunger by the credulous for numbers, any numbers however dubious their provenance, to lend support to the model of the moment. Maddison supplies that market….

We are comparing economies of distant times under the assumption that differences in the cost of living remained unchanged over centuries, or even over millennia. This problem, not at all a minor neither a new one − e.g. Prados de la Escosura (2000) − is here practically ignored. One indeed may have the feeling that the authors (and Maddison before them) simply don’t care about the parities they use, de facto treating them as if they were at current prices…

Roman Empire GDP Per Capita Map Shows That Romans Were Poorer Than Any Country in 2015 Brilliant Maps

April 20, 2016


Brad DeLong
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