For economic historians, the period between 1815 and 1914(for the sake of brevity “the 19th century”), is defined above all by the consequences of the first Industrial Revolution. This ultimately led to more and more countries enjoying rising living standards, even as population grew at unprecedented rates. The process of industrialization was uneven, however. It began in Britain, and quickly spread to Northwest Europe and North America. By the end of the 19th century there were clear signs of modern industrialization in countries all around the world. But the delayed diffusion of modern industry meant that an enormous gap in living standards opened up: a “Great Divergence” that is only now being slowly unwound.

This Great Divergence implied that the world became increasingly asymmetric, divided between an industrializing “core” and an as yet non-industrial(or even de-industrializing) “periphery”. This opened up the possibility of large-scale trade, with the core exchanging manufactured goods for the food and raw materials produced by the periphery. Since the core and the periphery were located in different continents, trans-oceanic trade would necessarily be at the heart of such a development, which required lower trade costs. And trade costs did eventually fall, massively, as a result of two consequences of the Industrial Revolution.

INTRODUCTION: LONG-RUN TRENDS

This chapter provides a brief introduction to the history of Britain's engagement with the international economy between 1870 and 2010. It begins by discussing long-run trends in the integration of the British economy with the rest of the world. Economic historians are typically interested in four types of flows between economies: trade in goods and services; flows of capital; migration flows; and flows of ideas and technology. The last flow is probably the most important one for countries hoping to catch up to the international technological frontier. While this was not the right way to characterise the British economy in 1870, it probably was at various points after the Second World War. Unfortunately, such flows are also the most difficult to quantify, and so I follow the bulk of the literature in concentrating on trade, capital flows and migration.

When measuring the extent to which commodity, capital or labour markets are integrated at various points in time, researchers have adopted several approaches. The most straightforward is simply to measure the extent of trade, or capital flows, or labour flows, and see how these vary over time. In order for intertemporal comparisons to be meaningful, it is common to express the flows as a percentage of GDP, or relative to the total population, as appropriate. Another approach is to focus on the costs of transacting internationally, which will be reflected in price gaps for a homogeneous commodity, or financial asset, or type of labour, between two markets. Falling international price gaps are a sign that markets are becoming better integrated over time, rising price gaps a sign of disintegration.

It is possible that prices could converge internationally for reasons having nothing to do with trade, while trade can increase for reasons other than the integration of international markets. If, however, price gaps converge at a time of falling transport costs, trade liberalisation, and/or rising volumes of trade, then it seems safe to conclude that integration is taking place.

OVER THE FIRST FEW MONTHS we were given an introduction to Korean mores. Our pastoral counsellor talked from his own personal experience. Like most of the early missionaries he was colonial in his mindset, which meant that whereas he had no great affection for the Japanese, he thought they were a necessary evil and an inevitable part of Korean economic development. Many foreigners were tarred with the ch’inil (pro- Japanese) brush because of attitudes like this. He also had negative attitudes about Korean abilities to do things the way he thought they should be done. He felt the screw was never given the last turn, equipment was inherently flawed, bits and pieces inevitably fell off. He didn't know it, but he was also pointing out the flaws of Japanese merchandise in the first years of Japan's industrial development. Learning is a long process. Korea was at stage one while Japan had moved on to stage two. Our counsellor had forgotten Japan's stage one.

Along with a colonial mindset, the older missionaries had a flawed view of the Confucian legacy, which I believe came, in part at least, from the early French missionaries and Dallet's book on the Korean church. Dallet never set foot in Korea. He compiled his book on the basis of letters sent home to Paris by the French missionaries. The book is amazing for the wealth of information it contains on Korean institutions and mores. The shorter English version should be compulsory reading for those who don't read French but who aspire to live long-term in Korea. Dallet reached some wrong conclusions, inevitably so, I suppose, since he was relying on second-hand information. One of the areas where Dallet got it wrong was in dealing with the Confucian tradition. Korea in the 1800s had a large population of dispossessed yangban who for one reason or another could not get posts in the bureaucracy. To work was beneath their dignity, but they retained the right to complain and criticize. They were a constant drain on society and a thorn in the side of the developing church whose appeal, despite yangban beginnings, was egalitarian.

Tidal Wave

ONCE, IN MY GRANNY’S, the flooding tide rode the stream, slipped through the hemp hedge, passed through the cornfield and gathered to a brimming fullness in the yard. I splashed around delightedly in my bare feet, looking for goby and shrimp; my joy went right into my teeth like the chirps of a baby lark. Normally the mere sight of me was enough to set granny talking about the old days: she would talk endlessly, like the silkworm makes its thread, but today she stood there without a word and looked out to sea, her face already very old, reddening like the gentle rays of the evening sun. At the time I had no idea why she was doing this. Indeed it wasn't until she was dead that I found out. My granddad was a boatman, a fisher of distant seas. One winter before I was born, he was caught in a bitter wind and swept into the sea; he never came back. Presumably it was the sight of her husband's sea driving into her yard that rooted granny there, wordless, red-faced.

The Singer

When the song of Chilmajae's finest singer lost its edge, his antidote was to twirl the twelve-string streamer on his head; when his song got boring, he liked to stand a cowled monk on his shoulder. For the funeral bier he had a brass handbell that shone like the sun, which he hung on the front. The singer's song reached from this world to the next.

One morning when our village singer was not engaged in song, I saw him removing the contents of the honey bucket in the outhouse. What can I say! Our honey bucket was noted for the way it reflected moon and stars. He stood there, exposed to wind and rain, busily using our wonderful, roofless honey bucket as a mirror to dye beneath his topknot headband. He pushed his hair back up under the headband – nicely, nicely – and dyed it with appropriate decorum.

Perhaps this mirror, so special, so fertile, was also the source of his song, which was so luxuriantly effective in bridging this world and the next.

I’M RELUCTANT TO TREAT the topic of learning Korean because I don't know what to say that won't sound trite. In the 1960s, there was a school of thought that viewed efforts by foreigners to learn Korean as fundamentally silly. James Wade was the group's major general. Wade was an icon in cultural matters. A big-framed, handsome man, he was a noted music teacher and composer, and an all round man of letters, He had a column in the Korea Times – Scouting the City – which was eagerly awaited every Saturday by the ex-pat community. I loved his column even if I didn't agree with his views on learning Korean, but to be fair, his attitude to the language was based on the difficulty of getting anywhere unless you were willing to live with a Korean family, which would have been very difficult in Wade's time, and attend a full-time language institute, which would have been even more difficult since such institutes did not exist until the end of the 1950s. The Korean Language Institute of Yonsei University (KLI) was founded in 1959 and it claims to be the first of its kind in the country. Columbans ahead of me attended language classes in Seoul National University, but I’m not sure if there was a formal language school there at the time.

It's widely agreed that Korean is a very difficult language for a Westerner to learn. I put in the Westerner proviso deliberately because in my school days Japanese students learned in six months what it took us two years to learn. And my teacher told me she taught two Indian students in the 1960s who learned much faster than any Japanese student in her experience. No one is sure why East Asians learn Korean so easily and we find it so difficult. We complain about the particles nŭn/ka, ŭl/rŭl, and we gripe about honorifics and the irregular verbs. None of these is the root of the problem. Getting the particles right facilitates using nice Korean, but the particles were never a barrier to communication, not any more than confusing the definite and indefinite articles in English interferes with communication.

YOU REALLY HAD to see Korea in the sixties to know what it was like. Korea time was the conceptual axis on which the culture turned. Modernization and the need for quick decisions have done away with this lovely, lazy, exasperating way of life. If you couldn't do something today, there was always tomorrow, or the next day, or next week. If you know some Korean, ask yourself when was the last time you heard the word kŭlp’i – two days after tomorrow! Sŏ Chŏngju describes this old-time world:

Arriving in Korea is etched in my memory like a scene from a Somerset Maugham story. Ireland in the 1960s understood the Tosŏng-Kwan’gi notion of time; my group was a month late getting here. Frank McGann, complete with straw hat and cigar, met us at Kimpo airport and gave us our first introduction to the land of the morning calm. Frank was an old hand – he had been here since Japanese times; in fact he had been under house arrest in Hongch’ŏn during the Pacific War.

THIS BOOK WOULD NOT BE COMPLETE without a note on North Korea. A trip to the Diamond Mountains reinforced the idea of the ugly arrayed alongside the beautiful, though the north's greatest ugliness was its utter lack of freedom.

LET THERE BE LIGHT

IT WAS ONE OF THOSE FRESH, pleasant, late autumn days in Kangwŏn Province with just a hint of frost, the air so clean you could taste it. The parish priest, out for a morning stroll, felt invigorated by the crisp blow. Anxious as always to spread a bit of largess around, his one-man entourage advanced in semiregal progress: he bowed to everyone he met, and everyone who met him bowed back. There were smiles and greetings all around. Good will to all people was in the air, on the tongue and entwined around the bending backs. Public relations was the agenda, an item of the highest priority to the parish priest.

Largess was a universal quality, to be dispensed in large quantities at all times… even when there was question of that most deadly of offences, encroachment. The foreigner always felt himself to be a prime target for encroachment, and every parish priest worth his salt held himself alert for any possibility of the dreaded offence. The world was full of people trying to encroach, but the successful parish priest could smell the kimch’i pot of encroachment before the lid was taken off. After all, protection of church boundaries, physical and spiritual, was his sacred trust.

Against this background, it should come as no surprise that on this particular morning when the parish priest turned the final corner home and noticed activity under an electric pole behind the church, he was alert immediately to the possibility of encroachment. He moved in the appropriate direction, but with neither change of pace nor expression. Everything was done with due seasonal rhythm.

‘Morning, men.’

‘Good morning, shinbunim.’

‘Nice day, men.’

‘Yes, indeed, shinbunim. Soon be winter though. Gets very dark in winter, shinbunim, very dark indeed.’

‘Ah, yes, I know, I know.

There was a brief pause after the seasonal greetings had been exchanged. It was important to hang loose, the parish priest knew, but the double dark reference was echoing through his head. His antenna was up. He did not like what he had heard. There could be encroachment here. Some investigation would be required. He began again, casually, tentatively.

NEW IN KOREA? Feeling the strain? You are much better off than we were. At least you can read Dr Crane's Korean Patterns (1967). Beg, borrow or steal it. It tells you how the Korean mind works and the areas in which a foreigner must be particularly careful. Insightfully, Crane begins not with relationships, which would be the obvious place to start, but with kibun. There is no English word for kibun, but when you have been in Korea for a while, you’ll know all about it. Kibun controls everything. With good kibun, you feel good; with bad kibun, you feel bad. By the time you motor through the gradations of good, better and best, not to mention bad, worse and worst, you’ll know a lot about kibun. For one thing, you’ll know that it's not just a matter of your kibun; the other person's kibun is important too. That's lesson number one.

And read Yi Munyŏl's Our Twisted Hero. This book gives the psychology of relationships and consequently of power in Korea. Ultimately, it is an allegory on power, said to be like The Lord of the Flies but really very different. It is an allegory about the abuse of power during the era of the generals in the ‘80s, but the way relationships work here shows how they have worked throughout history at all levels of Korean society, from government to hospitals and schools, from crooks to bishops.

Ŏm Sŏkdae, monitor of the sixth grade in an elementary school, rules his class with an iron fist. A sinister, shadowy figure, he terrorizes his classmates into abject submission, reducing them to cringing, fawning pawns. He beats them, takes their money, uses them to cheat on exams, collects ‘dues’, sells preferment and in general insists on being treated as a king. The story is told from the point of view of a transfer student from Seoul who challenges Sŏkdae's dictatorship.

The King's Pride

Chidaero of Shilla's thingamajig – if you allow for a little fictive embellishment – was a foot and a half long, posing a major worry to the realm, for neither in mountain, nor field, nor by the sea, nor sequestered on any remote island was a girl to be found capable of withstanding the king's pride. Lo! one winter's day under an old withered tree – this too with a little fictive embellishment – a dung patty big as an hourglass drum was found. It had been made with such zest and whoopee that though two mongrels tug o’ warred and devoured the prize, a sufficiency remained to attest to its magnificent original size. Who had left this giant patty? The question was asked in every corner of every village until finally a diminutive little girl came forward. ‘The one you seek lives over there,’ she said. ‘Wasn't there a stream beside the patty,’ she added, ‘a lovely little stream? Well, the girl you want took her washing there, and when she had washed more than a hundred pieces, she went into the woods and that's what she made.’