A Numerical Revolution: The Diffusion of Practical Mathematics and the Growth of Pre-modern European Economies

Abstract

The accumulation of knowledge and its application to a variety of human needs are discontinuous
processes that can lead to economic growth through innovation and change. In this paper, we
focus on the diffusion of new mathematical knowledge from the 13th to the end of the 16th
century in Europe. Using an original dataset of over 1000 manuals of practical arithmetic, we
produce new descriptive and quasi-experimental evidence on the economic importance of the
European transition from Roman to Hindu-Arabic numerals (0, 1, 2, 3, 4, 5, 6, 7, 8, 9). We
show that, by laying the foundations for the commercial developments observed from the 13th
century onwards, this numerical revolution had positive and significant effects on the growth of
pre-modern European economies.

Keywords: Human capital; knowledge diffusion; learning; economic growth

JEL Classification: O3, O4, N13, N3