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Political Institutions, Economic Liberty, and the Great Divergence

  • Gary W. Cox (a1)

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 600–1800 ce throughout Eurasia, I show that inter-city growth correlations were positive and significant only in Western Europe after 1200 ce. 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.

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I thank Avidit Acharya, Robert Bates, Lisa Blaydes, Mark Dincecco, Jim Fearon, Vicky Fouka, Phil Hoffman, Ken Scheve, and participants in the Comparative Workshop at Stanford and the Kim Thomas Interdisciplinary Lecture at Whittier College for their comments. I also thank Darin Christensen for programming assistance.

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