intercontinental trade and the development of the third world since the industrial revolution, patrick o'brien (1997)

(76): productivity growth in Europe was 'endogenous' (citing A. Maddison)

(77): [1. GOODS] key--commerce in 'the Wallerstein period (1492-1789)' had more in common with a 'medieval' past--before 1846, export+import/production ratios were in the region of 1-2 percent. for Britain, Portugal, Holland, below 15%.

(77): before railways, most prices set locally, not influenced by long-distance trade.

(78): [2. CAPITAL] European money going abroad was a 'miniscule percentage' of world capital formation--persistent imperfections in international capital markets

(78): [3. LABOUR] numbers migrating in mercantile era were very small--most went close to place of birth

(79): wasn't until 1914, that overland transportation had competitive advantage over waterborne

(80): Treaty of Vienna allowed for 'peaceful' development of international commerce

(80, see 86): 1821-1921, 138 new colonies for Europe; by 1914, population of 530 million under their sway. nominally independent countries opened up (Ottoman, S Aerica, Arabia, Indian princely States, China, etc.)

(81): after 1815, a 'liberal' trade regime [very different from Bairoch's account, take note]

(81): trade grew at 4-5% in 1800s, after 1% in 1700s

(82): by 1913, ratio of exports+imports/income were about 30%; they were about 2-3% at beginning of 1800s.

(82): [1. GOODS, 1800s] key--main supplier region of RM for Europe was white settlement countries overseas; second was Europe's peripheries; third was Third World.

(83): [2. LABOUR, 1800s] between 1821 and 1915, 46 million people left native lands for overseas--most, though, were Europeans going to US (and they left, in the main, the poorer regions, especially in the latter half of this period)

(84): benefited both labour-surplus and labour-scarce regions--an equilibrium-restoring process, at a general level

(84): [3. CAPITAL, 1800s] as much as 30% of savings going overseas [!]. most financed regions of European settlement (see p. 91--$131 per capita in white settlement, $11 in Asia and Africa). [O'Brien has a very sanguine story about what happened when it went to Third World, but without that angle the point remains]

(86): in 1913, European countries included 11 times more land, 18 times more people in their colonies, than in their core

(86-92)): assessment of dev of und argument--(1) the share of European exports going to TW went from 15% in 1830, to only 21% in 1910 (a real increase of nineteen times, but not much in relative share; (2) the share of European imports coming from TW also negligible (details within)

(93): 1820-1910, terms of trade move in favour of the TW [read around here, some oversanguine conclusions]

(95): most 'gains' from export trade went to expat Europeans

(96-97): in sum--suggestion that not only did imperialism not explain development, it doesn't do much to explain underdevelopment (if it did, all it did was divert talents/energies!). underdevelopment, instead, is explained by antecedent factors--(1) initial factor endowments and (2) ability to attract European investment [this latter half will require response that does more than just use India as example, though that is important]

(98, see 104): imp--1913-1945 marks the Dark Age for Third World, b/c of wars and international depression [these are regarded, almost, as exogenous to the Era of Progress that preceded them]

(99): there were three trends, though, that exacerbated all this:

1. rising proportion of food satisfied by domestic production, b/c nations worried about self-sufficiency
2. substitution of synthetic materials depressed demand for natural RM
3. rise of NA as industrial power, and it used its own RM

(101, 102): 1910-1950, no increase in rail track per square mile in TW [this is the archetypal liberal account of 'gains from trade', but it isn't really stood on solid ground]

(105): in sum--TW not doing well, 1900-1950, in terms of manufacturing output, welfare, etc. [the implication, here, though is that TW intellectuals misunderstood the problem; it was a breakdown of trade that was responsible, not its continued operation--see p. 109 ('the North is responsible, but only for initiating wars that ruined commerce')]

(106-108): imp--many reasons to suspect that 'gains from trade' were likely weaker, in TW (b/c of expats, b/c of structure of plantations, etc.); but fair point that theoretical speculation needs to be backed by data, of which there isn't enough

(108): noting, though, that peasant mode of production isn't always superior, for development, to plantation mode

(114-115): TW share of global exports decreased from 40% after WWII to 22% in 1990s [though this is obviously symptomatic of deeper problems; not the problem, itself!]

(115-116): key--N-N trade represents about 60-65% of total trade, in post-WWII period; S-S trade is about 10%; S-N trade is about 30-40%

(118): oil price rise checked decline of TW exports as global proportion; and checked increasing proportion of manufactures in world trade. but these two trends stand out, when this is taken into account.

(121): tendency of net terms of trade is to move against primary products, in 20th C [but check against Bairoch]. this highlights necessity for developers to move into industrial goods.

(126): ends with banal call for end to protectionism.