The Impact Of Western Developpment On The Rest Of The World 1000 1950

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The Impact Of Western Developpment On The Rest Of The World 1000 1950

  1. 1. Course: Global Economy Policy Year: Winter semester 2008/2009 Program: European Master in Business Studies University: University of Kassel The Impact of Western Development on the Rest of the World, 1000-1950
  2. 2. Aim/Purpose: This 70 pages-text explains how some Western countries developed their economy by making exchanges with other countries from the years 1000 to 1950. That means going back on the colonization past of some countries. Here the ones chosen are what we would called now Italy(mainly the Venetian Republic), Portugal, Great Britain and the Netherlands. Arguments: The main ideas of this text are the following: – The economical history of these countries was not homogeneous but made from up and downs; – The situation we are living now in 2008 (Asian countries which are rising up) is not new, 1000 years ago the Asian world was five time bigger as the European one and as wealthy, even more. Trading with Asia was already existent in the second century as well as knowledge to use some natural advantages(such as winds or specific locations); – Innovations and technologies have always been the major drivers to economic development; – Notions of capitalism were already there; – On page 50(last paragraph) there is a very good summary of one of the main idea of this text. A country stops to grow once that it stops to exchange: no exchange—> no communication. No transfer of knowledge--> so no new technologies--> technology are driving growth because it increases for example the production or give a competitive advantage to a specific country. Whatever the country it concerns his success or his decadence has been driven for one part by the acceptance or not of a technology; – Trade barriers, interest of being implemented in some countries, trading privileges, intellectual property are as well some notions which were present centuries ago; – The concept of specialization by countries is also explained: for example it is better for country A to specialize in product A and for country B to specialize in product B. Even if country A&B can both of them produce these products, they have an interest to exchange because of cost production; – There is also the idea of internal transfer of knowledge what we can call education which is important to underline;
  3. 3. – The development of a country depends also and of course of his economy and political system; – Fiscal system was there as well playing the role of helping or not trading, if trade was jeopardized then the final situation was to come into war; – Countries were not exchanging for pleasure but to maintain good relationships in order at the end to get the maximum profit. Good relationships were then very important, it was more or less the way that China used to colonize the world even if they were always moving with military forces whereas the Western countries were more opting to use the force; – Religion took as well an important part. The idea being if I can transmit my religion then I can transmit my culture. If I can transmit my culture then I have one foot abroad. If I have one foot abroad then I can exchange far more rapidly abroad; – The fall of an Empire has also been driven by several causes such as catastrophes, high competition in a specific sector, rising up of some countries...and even sometimes it is not the fall of an Empire but just the end of the major growth period; – The idea of intellectual property and espionage were already in use. Protectionism of their technology, by keeping their secret Portugal succeeds to reach Brazil before the others; – The location of some countries on Earth was giving and actually is still giving high competitive advantage to some countries in order to trade; – It goes back as well to the same problematic as today, in order to develop a huge project you need investment which at that period was belonging to the King or the Queen; – Asian countries had at that time more or less the same technology as Western countries; – Notions of embargo were already settled; – The author goes back to several cultural differences within each country, beliefs and things like that which at the end reach all to the same conclusion: whatever the country was they were all looking for power, high development; – Every nations developed his own technology for a specific purpose. There was not yet the idea of developing a technology for someone else. For example Portuguese people needed huge and solid boats because they wanted to go to America. Chinese did not have the same needs so they were looking for the practical side, comfort and easy-to-repair boat; – Whatever the country and his intention they were always moving with a military force; – The world was not flat at that time, some civilizations were not as advanced as others; – Countries have always protected others for personal economic interest; – This text come back as well on slavery; In order to make a summary I would say that most of the arguments are dealing with technical innovations and the fact that the economic world which is nowadays driving the
  4. 4. world is more or less the same as centuries ago, all is about trade barriers, exchange of good and services, cheap labor etc... Method used: He decided to show by taking 4 countries how the world was running on a trading point of view during this period. He wanted to make it as global as possible, that it is why he took the seas which were the most dynamic. For example the Mediterranean one which was dominated by the Venetian Republic, the Atlantic which was dominated by Portuguese people , and he decided to take two others to represent the Pacific sea with the Netherlands and Britain. Another method he used that I noticed very well is describing in an exhaustive way the technical innovations which brought to some countries a competitive advantage regarding others. Criticisms about the text: I like the way the author wrote the text. He even recognize that what he wrote can be subject to a large error margin, I like this transparency. I regret however that he does not explain why some countries do have a need to colonize some others. What is the interest to discover the world(is it for culture? Is it for economical interest? Is it for challenge? for example when the USA sent people on the moon). He does not mention the case of France which for me has been of the largest country which colonize the world. For me he does not explain very well why slavery was so important. It is not explained concretely in the text but the idea was the following. Regarding our epoch we are using Asian countries in order to use their low cost labor competencies. From 1000 to 1500 Asia seemed to have a better cost of living that Western countries. So how to get cheap labor competencies: by importing(instead of exporting) the labor force, in our case this is why to my
  5. 5. point of view they needed slaves. So actually the idea of outsourcing that we know nowadays is nothing new. A slave and actually it is why it is interesting to highlight it is to make someone works in your national country at a cost far lower that the one in use in the same country. For me he spends too much time on some details of some technical innovation which are in fact not that important. He stressed some very interesting points and does not go to the end of the argument. For example when he speaks about the Mogul Empire which has no significant interest in foreign trade activities it does not explain what has been then the consequences of this refusal. Comment: What did I learn? In fact this text opened our eyes on the fact that the economical situation we are living right now in 2008 is more or less the same as centuries ago. I mean we did not invent anything in terms of politics, trade barriers, intellectual property. More rules have been sat up for example abolition of slavery and... not sure that it is still does not exist because the concept stay the same at the end. Instead of importing cheap labor we are exporting it. I did not know that at that time the Asian area was so active. I also discovered that Holland has been a great nation. I did not know anything about the colonization of Brazil by Portugal, so I learned that it has been very violent.

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