Unified China and Divided Europe

International Economic Review, January 2018, Forthcoming

56 Pages Posted: 23 Jan 2014 Last revised: 23 Apr 2017

Chiu Yu Ko

National University of Singapore (NUS) - Department of Economics

Mark Koyama

George Mason University - Department of Economics; George Mason University - Mercatus Center

Tuan-Hwee Sng

National University of Singapore (NUS) - Department of Economics

Date Written: September 1, 2016

Abstract

This paper studies the causes and consequences of political centralization and fragmentation in China and Europe. We argue that a severe and unidirectional threat of external invasion fostered centralization in China while Europe faced a wider variety of smaller external threats and remained fragmented. Political centralization in China led to lower taxation and hence faster population growth during peacetime compared to Europe. But it also meant that China was more vulnerable to occasional negative population shocks. Our results are consistent with historical evidence of warfare, capital city location, tax levels, and population growth in both China and Europe.

Keywords: China, Europe, Great Divergence, Political Fragmentation, Political Centralization

JEL Classification: H2, H4, H56; N30; N33; N35; N40; N43; N45

Suggested Citation

Ko, Chiu Yu and Koyama, Mark and Sng, Tuan-Hwee, Unified China and Divided Europe (September 1, 2016). International Economic Review, January 2018, Forthcoming . Available at SSRN: https://ssrn.com/abstract=2382346 or http://dx.doi.org/10.2139/ssrn.2382346

Chiu Yu Ko

National University of Singapore (NUS) - Department of Economics ( email )

1 Arts Link, AS2 #06-02
Singapore 117570, Singapore 119077
Singapore

HOME PAGE: http://sites.google.com/site/kochiuyu/

Mark Koyama (Contact Author)

George Mason University - Department of Economics ( email )

4400 University Drive
Fairfax, VA 22030
United States

HOME PAGE: http://mason.gmu.edu/~mkoyama2/About.html

George Mason University - Mercatus Center ( email )

3434 Washington Blvd., 4th Floor
Arlington, VA 22201
United States

Tuan-Hwee Sng

National University of Singapore (NUS) - Department of Economics ( email )

21 Lower Kent Ridge Rd
Singapore, 119077
Malaysia

HOME PAGE: http://profile.nus.edu.sg/fass/ecssth/stf_ecssth.htm

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