Forthcoming in the Journal of Economic Perspectives

Today, per capita income differences around the globe are large – varying by as much as a factor of 35 across countries (Hall and Jones 1999). These differentials mostly reflect the “Great Divergence ” (Sam Huntingon) – the fact that Western Europe and former European colonies grew rapidly after 1800, while other countries grew much later or stagnated. What is less well-known is that a “First Divergence ” preceded the Great Divergence: Western Europe surged ahead of the rest of the world long before technological growth became rapid. Europe in 1500 was already twice as rich on a per capita basis as Africa, and one-third richer than most of Asia (Maddison 2007). In this essay, we explain how Europe’s tumultuous politics and deadly penchant for warfare translated into a sustained advantage in per capita incomes. Much of the European advantage in per capita incomes emerged after the Black Death of 1350, which killed between one-third and one-half of the European population. In the three centuries after 1400, European per capita incomes grew rapidly, while Africa and Asia stagnated (Maddison 2001). By 1700, Western Europeans produced 2.5 times more than Africans, and 70-85 percent more than Indians, Chinese, and Japanese. Within Europe, there was also divergence: UK incomes were 75 percent higher in 170