ECONOMIC HISTORY I
2nd Semester, 2011-2012
Pedro Lains
pedro.lains@ics.ul.pt
A. The Course
The main purpose of this course is to understand the process of economic growth by looking at the
historical experience of Europe and its relations with the wider World, during the nineteenth and
twentieth centuries. The course starts by discussing the causes behind the first industrial revolution
in Britain, and proceeds by studying the reasons why it spread successfully to some parts of Europe
and not to others. Nineteenth century industrialization was facilitated by the first globalization,
which was interrupted after World War I. The course proceeds by studying what was then lost, and
why it took such a long time for the international economy to regain its momentum, which occurred
only after Bretton Woods. The development of the international economy was impressive since then,
albeit with important setbacks and fluctuations. We will also explore the reasons behind
international growth cycles. Students will need to get acquainted with specific concepts related to
the broader issue of economic growth in history, namely, total factor productivity growth,
convergence vs. catching-up, structural change, comparative advantage, factor-proportion and
gravity trade models, the gold standard, the Bretton Wood system, market integration, and
eurosclerosis.
B. Readings
The total number of required readings for the course is approximately 20 papers or book chapters,
one per lecture or practical class. It is also recommended that students get acquainted with one of
the following books: Allen (2009), Broadberry & O’Rourke (Eds.) (2010), Clark (2007), Eichengreen
(2007), Eichengreen (2008), Landes (1998), Neal (2007), or Pomeranz (2000).
C. Grades
The final grade will be a weighted average of two work assignments (40%), participation in classes
(10%), and a final test covering all material (50%). Students with an average of 8/20 and 9/20 will
have to make a final exam.
Abbreviations: AER, American Economic Review; AS, Análise Social; EHR, Economic History Review;
EREH, European Review of Economic History; EEH, Explorations in Economic History; JMCB, Journal of
Money, Credit, and Banking; JPE, Journal of Political Economy; REH, Research in Economic History;
SEHR, Scandinavian Economic History Review.
1
D. Lectures, practical classes and readings
Tue, 7 February
1. Introduction
Wed, 8 February (Lecture)
2. The First Industrial Nation (1780-1830)
[1]* Allen (2009). The British Industrial Revolution... Chapter 1.
[2] Harley, C. K. & Crafts, N. F. R. (2000) “Simulating the two views of the British Industrial
Revolution” JEH 60 (3): 819-841.
Tue, 14 February (Lecture)
3. Why Was the Industrial Revolution British?
[3]* Allen (2009). The British Industrial Revolution... Chapter 6.
Video: EHS Tawney Lecture by Robert Allen, 2009:
http://www.ehs.org.uk/ehs/podcasts/tawney2009.asp.
Wed, 15 February (Practical class)
4. The Spread of Industrialization in Europe (1815-1914)
[4]* Pollard (1998). “The peripheral European countries in the 19th century” in Batou & David (Eds.).
Uneven Development in Europe…
[5] Pollard (1981). Peaceful Conquest… Chapter 4.
Wed, 22 February (Practical class)
5. Agriculture and Economic Development in Europe since 1870
[6]* van Zandend (1991). “The first green revolution: the growth of production and productivity in
European agriculture, 1870-1914” EHR 44 (2): 215-239
[7] Lains & Pinilla (2006). Agriculture and Economic Development… Chapter 1
[8] Lains & Pinilla (2006). Agriculture and Economic Development… Chapters 9 & 13
Tue, 28 February (Lecture)
6. The Industrialization of the European Periphery (1870-1914)
[9]* Tortella, G. (1994). “Patterns of economic retardation and recovery in south-western Europe in
the nineteenth and twentieth centuries”. EHR 47 (1): 1-21.
[10] Sandber, L. G. (1979). “The case of the impoverished sophisticate: human capital and Swedish
economic growth before World War I”. JEH 39 (1): 225-241.
[11] Lains, P. (2002). “Southern European economic backwardness revisited. Open economy forces in
Portugal and the Balkans, 1870-1913”. SEHR 50 (1): 24-43.
[12] Lains, P. (2011). “The burden of backwardness: the limits to economic growth in the European
periphery, 1830-1930” in Guirao, F. et al (Eds.). Alan S. Milward…
Wed, 29 February (Practical class)
7. The Great Divergence (18th-19th centuries)
[13]* Broadberry & O’Rourke (2010). The Cambridge Economic History… Vol. 1, Chapter 11.
[14] Allen, R. C. (2000). “Economic structure and agricultural productivity in Europe, 1300-1800”.
EREH 4 (1): 1-26.
[15] Allen, R. C. (2001). “The Great Divergence in European wages and prices from the Middle Ages to
the First World War”. EEH 38: 411-47.
[16] Acemoglu, D., Johnson, S. and Robinson, J (2005). “The rise of Europe: Atlantic trade,
institutional change, and economic growth”. AER 95 (3): 546-79.
2
Tue, 6 March (Lecture)
8. What Did Governments Do? (1870-1914)
[17]* Kindleberger, C. P. (1951). “Group behavior and international trade”. JPE 59 (1): 30-46.
[18] Gerschenkron, A. (1962). Economic Backwardness… Chapter 1.
[19] Dormois, J.-P. & Lains, P. (Eds.) (2006). Classical Trade Protectionism… Chapters 7, 10 & 12.
Wed, 7 March (Practical class)
9. The First Globalization (1870-1914)
[20]* Broadberry & O’Rourke (2010). The Cambridge Economic History… Vol. 2, Chapter 1.
[21] O’Rourke, K. & Williamson, J. G. (2002). “When did globalisation begin?”. EREH 6 (1): 23-50.
Tue, 13 March (Lecture)
10. The Economic Consequences of World War I
[22]* Feinstein, C.H., Temin, P. & Toniolo, G. (1997). The European Economy ... Chapters 1 &2.
[23] Broadberry & O’Rourke (2010). The Cambridge Economic History… Vol. 2, Chapter 6.
Wed, 14 March (Practical class)
11. The Great Depression (1929-1932) I
[24]* Bernanke, B. (1983). “Nonmonetary effects of the financial crisis in the propagation of the
Great Depression”. AER 73 (1): 257-76.
[25] Eichengreen, B. (2008). Globalizing Capital… Chapter 3.
Tue, 20 March (Lecture)
12. Portugal’s Growth Paradox (1850-1950)
[26]* Reis, J. (1984). “O atraso económico português em perspetiva histórica, 1860-1913”, AS 20
(80): 7-28.
[27] Lains, P. (2007). “Growth in a protected environment: Portugal, 1850-1950”. REH 24: 121-163.
[28] Lains, P. (2003). “New wine in old bottles. Output and productivity trends in Portuguese
agriculture, 1850-1950”. EREH 7 (1): 43-72.
[Mid-term & Easter recess]
Tue, 17 April (Lecture)
13. Bretton Woods and Its Aftermath (1944-1957)
[29]* Eichengreen, B. (2008). Globalizing Capital… Chapter 4.
Wed, 18 April (Practical class)
14. The Great Depression (1929-1932) II
[30]* Bernanke, B. (1995). “The macroeconomics of the Great Depression: a comparative approach”
JMCB 27 (1): 1-28
[31] Eichengreen, B. (1992). “The origins and nature of the Great Slump revisited”. EHR 45 (2): 213239.
Tue, 24 April (Lecture)
15. The Economic Impact of European Integration (1951-1973)
[32]* Broadberry & O’Rourke (2010). The Cambridge Economic History… Vol. 2, Chapter 11.
Wed, 2 May (Practical class)
16. The Marshall Plan: Why It Succeeded (1947-1951)
[33]* De Long, J. B. & Eichengreen, B. (1993). “The Marshall Plan: History's most successful structural
adjustment programme” in Dornbusch, R., Nölling, W. and Layard, R. (Eds.). Postwar
3
Economic Reconstruction and Lessons for the East Today. Cambridge (Ma.): M.I.T. Press, pp.
189-230.
Tue, 8 May (Lecture)
17. Eurosclerosis (1973-1992)
[34]* Crafts & Toniolo (1996). Economic Growth… Chapter 2.
Wed, 9 May (Practical class)
18. The Golden Age of Growth (1950-1973)
[35]* Crafts & Toniolo (1996). Economic Growth… Chapter 1.
[36] Broadberry & O’Rourke (2010). The Cambridge Economic History… Vol. 2, Chapter 12.
Tue, 15 May (Lecture)
19. Europe and the Wider World (1992-2010)
[37] TBA
Wed, 16 May (Practical class)
20. Business Cycles and Economic Policy (1973-1992)
[38]* Eichengreen, B. (2007). The European Economy... Chapter 2.
[39] Broadberry & O’Rourke (2010). The Cambridge Economic History… Vol. 2, Chapter 14.
Tue, 22 May (Lecture)
21. Financial Crisis in the Long-Run: Then and Now
[40]* Reinhart & Rogoff (2008). “This time is different: a panoramic view of eight centuries of
financial crisis” (mimeo)
Wed, 23 May (Practical class)
22. The Distribution of World Income (1820-2010)
[41]* Bourguignon, F. & Morrison, C. (2002). “Inequality among World citizens, 1820-1992”. AER 92
(4): 727-744.
Tue, 29 May
23. Conclusions
D. Bibliography
Allen, Robert C. (2009). The British Industrial Revolution in Global Perspective. Cambridge: Cambridge
University Press.
Bordo, Michael D., Taylor, Alan M. and Williamson, Jeffrey G. (Eds.) (2003). Globalization in Historical
Perspective. Chicago: The University of Chicago Press.
Broadberry, Stephen and O’Rourke, Kevin (Eds.). The Cambridge Economic History of Modern Europe.
Vol. 1: 1700-1870, Vol. 2: 1870 to the Present. Cambridge: Cambridge University Press, 2010.
Cardoso, José Luís and Lains, Pedro (Eds.) (2010). Paying for the Liberal State. The Rise of Public
Finances in Nineteenth Century Europe. Cambridge: Cambridge University Press.
Clark, Gregory (2007). A Farewell to Alms: A Brief Economic History of the World. Princeton: Princeton
University Press.
Clemens, M.A. and Williamson, J. G. (2004). “Why did the tariff-growth correlation change after
1950?”. Journal of Economic Growth 9: 5-46.
Collier, Paul (2007). The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done
About It. Oxford: Oxford University Press.
4
Crafts, Nicholas and Toniolo, Gianni (Eds.) (1996). Economic Growth in Europe since 1945. Cambridge:
Cambridge University Press.
Costa, Leonor F., Lains, Pedro e Miranda, Susana M. (2011). História Económica de Portugal, 11432010. Lisbon: Esfera dos Livros.
Dormois, Jean-Pierre and Lains, Pedro and (Eds.) (2006). Classical Trade Protectionism, 1815-1914.
London: Routledge.
Eichengreen, Barry (2007). The European Economy since 1945: Coordinated Capitalism and Beyond.
Princeton: Princeton University Press.
Eichengreen, Barry (2008). Globalizing Capital. A History of the International Monetary System.
Princeton: Princeton University Press (2nd Ed.).
Eichengreen, B. and Irwin, D.A. (1995). “Trade blocs, currency blocs and the reorientation of World
trade in the 1930s”. Journal of International Economics 38: 1-24.
Feinstein, C.H., Temin, P. and Toniolo, G. (1997). The European Economy between the Wars. Oxford:
Oxford University Press.
Findlay, Ronald and O’Rourke, Kevin H. (2007). Power and Plenty. Trade, Wars, and the World
Economy in the Second Millennium. Princeton: Princeton University Press.
Gerschenkron, Alexandre (1962). Economic Backwardness in Historical Perspective. A Book of Essays.
Cambridge (Mass.): Harvard University Press.
Guirao, Fernando et all. (Eds.) (2011). Alan S. Milward and a Century of European Change. London:
Routledge.
Lains, Pedro (2003). Os Progressos do Atraso: Uma Nova História Económica de Portugal, 1842-1992.
Lisbon: Imprensa de Ciências Sociais.
Lains, Pedro (Ed.) (2009). Sem Fronteiras. Os Novos Horizontes da Economia Portuguesa. Lisbon:
Imprensa de Ciências Sociais.
Lains, Pedro and Pinilla, Vicente (Eds.) (2009). Agriculture and Economic Development in Europe since
1870, London: Routledge.
Lains, Pedro e Silva, Álvaro Ferreira da (Eds.) (2005). História Económica de Portugal, 1700-2000.
Lisbon: Imprensa de Ciências Sociais (3 Volumes).
Landes, David. The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor. London:
Little, Brown & Co., 1998.
Mokyr, Joel (1977). “Demand vs. supply in the Industrial Revolution”. Journal of Economic History,
Vol. 37 (4): 981-1008.
Mokyr, Joel (2010). The Enlightened Economy: An Economic History of Britain, 1700-1850. Yale: Yale
University Press.
Neal, Larry. The Economics of Europe and the European Union. Cambridge : Cambridge University
Press, 2007.
Pollard, Sidney (1973). “Industrialization and the European periphery”, Economic History Review, Vol.
26 (4): 636-48.
Pollard, Sidney (1981). Peaceful Conquest: The Industrialization of Europe, 1760-1970. Oxford: Oxford
University Press.
Pomeranz, Kenneth (2000). The Great Divergence: China, Europe, and the Making of the Modern
World Economy. Princeton: Princeton University Press.
Reinhart, Carmen M. and Rogoff, Kenneth S. This Time Is Different: Eight Centuries of Financial Folly.
Princeton: Princeton University Press, 2009.
5