AØKA08214U Summerschool 2021+2022: The Economic History of Europe

This comprehensive course offers theoretical and historical insights into the evolution of Europe. We start by tracing the continent’s emergence from being a technological and economic backwater at the end of the first millennium to being able to match the advanced Muslim and Chinese civilizations around 1500. We continue by following the economic advances as Europe forged ahead, becoming the leader of the Industrial Revolution and the source of numerous technological innovations, which were diffused internationally through trade and colonial domination, but with varying impact on the rest of the world. It is shown that Europe was unique in fostering a mentality of rational inquiry into the laws of nature which led to an industrial enlightenment. A special focus will be on the last 200 years of dramatic economic development, when a remarkable increase in income has been accompanied by recurrent crises and increased world inequality but decreasing domestic inequality. This has generated a variety of responses such as the modern macroeconomic stabilization policies, the Welfare State, and attempts to tame the disruptive impact of financial turbulence and unemployment. Although the last 150 years have been a period of remarkable growth, they have also been a period of recurrent crises which require explanation.

Lecture Plan

1. The making of Europe. How Europe developed into an integrated economic region with intensive trade and cultural similarities across the continent despite endemic political and military conflicts. (Chapter 1)

2. The secrets of pre-industrial growth. Gains from specialization through division of labour before the Industrial Revolution. The restoration of monetary order and international trade. The first general purpose technology at work: water and wind mills. (Chapter 2)

3. The dynamics of population growth. Thomas Malthus versus Adam Smith. The exceptional family planning practiced in Europe (before the pill) which helped the continent escape poverty. (Chapter 3)

4. When and why Europe took the lead. Slow but persistent growth in Europe allowed the continent to forge ahead several centuries before the Industrial Revolution. How to measure economic growth in poorly documented economies. Was the Industrial Revolution really a Revolution? (Chapter 4 and section 1 in chapter 6)

5. Firms, farms and co-operatives. The institutional diversity in economic progress with a special focus on the advantages of co-operative enterprises in Scandinavia. (Chapter 5)

6. Historical foundations of modern economic growth. Science and technological catch-up. Why are some nations pioneers and others late-comers in the modernization process? (Chapter 6)

7. The origin and development of money and banks. The anatomy of banking crises and why we have to live with them. (Chapter 7)

8. Trade, tariffs and growth. The evolution of the comparative advantage argument for free trade. How trade policy affects growth. What does the historical record teach us about the wisdom of adopting protectionist measures? (Chapter 8) 
9. International monetary systems in history. Why an international monetary system is necessary. The policy choices available to an open economy. The history of international monetary regimes. The Eurozone crisis in historical perspective. (Chapter 9)

10. From the minimal state to the Welfare State in the 20^th century. Economic policy, inflation and unemployment. Do austerity policies work? A comparison between the interwar period (1919-1939) and the present crises in the European Union. (Chapter 10)

11. Trends in inequality between and within nations. We trace inequality from the Roman era to the present. Has the trend towards increasing equality within nations been broken and what is happening to world inequality? (Chapter 11)

12. Globalization is not new! What globalization does to your welfare and the welfare of poor nations. Welfare effects of trade and foreign investments. (Chapter 12)