Political Institutions, Economic Liberty, and the Great Divergence

In: The journal of economic history, Band 77, Heft 3, S. 724-755

Abstract

I argue that Europe's political fragmentation interacted with her political innovations—self-governing cities and national parliaments—to facilitate "economic liberty," which in turn unleashed faster and more inter-connected urban growth. Examining urban growth over the period 600–1800cethroughout Eurasia, I show that inter-city growth correlations were positive and significant only in Western Europe after 1200ce. Within Western Europe, I show that growth correlations were greatest in the most fragmented and parliamentary areas, individual cities became significantly more tied to urban growth when their realms became parliamentary, and spillover effects (due to competition between rulers) were significant.