Topic 7 - European Catch-Up Flashcards
(61 cards)
What is Total Factor Productivity (TFP)?
The portion of output growth not explained by measured inputs of labour and capital—often called the “Solow residual.”
Define intensive growth.
Growth driven by higher productivity (output per worker) rather than by simply adding more workers or land.
Define extensive growth.
Expansion of output that comes mainly from employing more inputs (labour, land) rather than better technology or efficiency.
What is the productivity frontier?
The highest level of productivity achieved by the world’s leading economy at a given time (Britain c. 1870; the US by 1913).
Explain social capabilities (Abramovitz).
The institutions, education, finance and governance that enable a country to absorb and implement frontier technologies.
What is structural change in economic history?
The long‑run reallocation of labour and capital from low‑ to higher‑productivity sectors (e.g. agriculture → industry → services).
Define capital deepening.
An increase in the amount of physical capital available per worker, raising labour productivity.
What marks the Second Industrial Revolution (c. 1870‑1914)?
New science‑based industries (chemicals, electrical, steel) and organisational innovations such as large universal banks and cartels.
What does catch‑up (convergence) growth mean?
Faster growth in follower countries as they adopt frontier technologies, narrowing the income gap with leaders.
What is real GDP per capita and why is it useful?
Gross domestic product adjusted for prices and divided by population; a standard gauge of average material living standards.
RobertM.Solow, “Technical Change and the Aggregate Production Function” (1957): main insight?
Shows that most U.S. growth (1909‑49) came from TFP—launching the Solow residual concept and growth‑accounting method.
AlexanderGerschenkron, “Economic Backwardness in Historical Perspective” (1952): core argument?
Late starters can industrialise rapidly by substituting institutions (e.g. universal banks, state direction) for missing pre‑requisites.
MosesAbramovitz, “Catching Up, Forging Ahead, and Falling Behind” (1986): contribution?
Links convergence speed to a nation’s social capability to absorb frontier know‑how; explains uneven European catch‑up 1870‑1913.
WaltW.Rostow, “The Stages of Economic Growth” (1960): key thesis?
Economies pass through five linear stages (traditional → take‑off → maturity, etc.); 1870‑1913 is Europe’s “drive to maturity.”
W.ArthurLewis, “Economic Development with Unlimited Supplies of Labour” (1954): relevance to Europe?
Dual‑sector model explains how surplus rural labour can fuel early industrial growth—fits Southern & Eastern Europe’s dynamics.
DouglassNorth & RobertThomas, “The Rise of the Western World” (1973): institutional view?
Secure property rights and efficient markets lower transaction costs, making sustained growth possible from 1700s onward.
PaulRomer, “Increasing Returns and Long‑Run Growth” (1986): challenge to Solow?
Endogenous‑growth model makes technological change a product of purposeful R&D investment, not an unexplained residual.
RobertC.Allen, “Progress and Poverty in Early Modern Europe” (2001): central claim?
Britain’s high wages and cheap coal incentivised mechanisation, explaining its early lead (“high‑wage economy” thesis).
StephenBroadberry & N.Crafts, “British Economic Growth, 1270‑1870” (2003): finding on productivity?
Britain’s productivity growth was gradual; its lead at 1870 derived from higher service‑sector and agricultural efficiency.
KevinH.O’Rourke & JeffreyG.Williamson, “Globalization and History” (1999): importance for 1870‑1913?
Demonstrates how trade integration and mass migration drove European factor‑price convergence before WWI.
How does Gerschenkron’s “backwardness” critique Rostow’s stages?
Gerschenkron rejects universal stages; he argues late industrialisers follow distinct, state‑led paths rather than Rostow’s linear “take‑off.”
Solow vs. Romer on the source of technological progress?
Solow treats tech change as exogenous; Romer endogenises it via R&D and human capital, explaining sustained growth without diminishing returns.
Main criticism of Abramovitz’s social‑capability concept?
Hard to measure empirically; risk of circularity (capability both explains and is inferred from growth performance).
Why does Lewis’s dual‑sector model fit less well for Northwestern Europe?
By 1870 Britain, Germany & France had largely exhausted surplus rural labour, so wages rose earlier than Lewis predicted.
