The Crucial Century

If a peaceful extraterrestrial visited the world in 1550, I often wonder where it would see as being the most likely site of the Industrial Revolution – an acceleration in the pace of innovation, resulting in sustained and continuous economic growth. So many theories about why it happened in Britain seem to have a sense of inevitability about them, but our extraterrestrial visitor would have found very few signs that it would soon occur there. There were many better candidates, on a multitude of metrics.

Our visitor might first have searched for well-populated hubs. There are mountains of research on the importance of cities for innovation and economic growth. But the most urbanised area in 1550 was what would eventually become present-day Belgium, with almost a quarter of its population living in cities. The areas now corresponding to the Netherlands, as well as Italy and Spain, all had urbanisation rates of over 10%. By contrast, only 3.5% of the population of England and Wales lived in cities, with likely fewer in Scotland. Britain would not have looked promising.

Of course, the size of the country also matters when measuring urbanisation - Belgium is a lot smaller than Spain. But if our visitor looked instead for the largest cities, then Britain’s largest urban centre, London, would also have barely registered. At about fifty to seventy thousand inhabitants in 1550, it was dwarfed by Beijing and Constantinople, both about ten times as large. There were many more huge cities in China, but in Western Europe alone, both Paris and Naples were also at least three times larger than London.

Nonetheless, our visitor might also have looked at places that were already quite wealthy. Some historians argue that Britain’s precocity hinged on it building upon prior wealth or high living standards, derived from any number of sources – skills, trade, agriculture, or conquest. Britain’s eventual success, when viewed through this lens, can appear to be the inevitable product of accumulating capital to spend on technological experimentation; or of a commercial hub being inspired by the newly-imported products of west and east; or of a less malnourished and potentially smarter population simply achieving its potential.

But England in 1550 was by global standards quite poor. Historical GDP per capita measures are notoriously difficult to obtain, even for some countries in the twentieth century let alone the sixteenth. The historical GDP per capita of England – by far the most studied region – is still hotly debated among economic historians. Nonetheless, according to the most recent collection of estimates – the Maddison project’s database of 2018 – in 1550 our extraterrestrial visitor would have been much more interested in Belgium. England at that stage lagged behind almost all of the areas for which we have estimates: Holland, Spain, Italy, Sweden, and France. In 1600, it was behind Portugal and India. Here are the figures in 2011 dollars; the colours are by row:

​​Such estimates should of course be taken with a hefty boulder of salt. (Note, also, that these particular figures, called "CGDPpc", are something of an innovation by the team compiling the Maddison Project Database - they use multiple benchmarks to improve how we compare countries' relative incomes in any particular year, which comes at the cost of not being able to compare their growth rates, for which there are separate figures. In other words, you should read the figures by row, not by column.) But it is worth noting that the more recent research on historical GDP per capita, finally filling in some details for regions other than England and Holland, often results in those other countries seeming richer in the sixteenth and seventeenth centuries. The more we know, the more the traces of an early English divergence seem to disappear.

Even without access to such statistics, however, our visitor would have noticed that in the mid-1550s England suffered severe food shortages. Indeed, the threat of famine would be present right up until the beginning of the eighteenth century: there was a major famine in the north of England in 1649, and even a famine in the 1690s that killed between five and fifteen percent of Scotland’s population. Britain would one day become perhaps the first famine-free region, but that did not occur until much later, when innovation had already begun to accelerate. It may even have been its result.

And England in 1550 was not just poor; it was also weak. If our visitor thought, as some historians do, that conquest and exploitation were essential for future growth, then it was Spain that had the major overseas empire, followed by Portugal. England in 1550 had no colonies in the New World, and its attempts to found them all failed until the seventeenth century, by which stage the Dutch and French had also begun to extend their own empires too. It was not until the eighteenth century that Britain began to exceed them.

In fact, England in 1550 was not even close to being Europe’s preeminent naval power. It was Hispania, not Britannia, who ruled the waves. Even on maps made in England and for the use of the English government, the ocean off the west coast of England and to the south of Ireland was labelled The Spanish Sea. The foreign maps agreed. The North Sea, too, was the Oceanus Germanicus, or German Sea. It gives an idea of who controlled what. And England of course came close to catastrophe in 1588, when the Spanish decided to launch an invasion – although English ships did manage to inflict an initial defeat on the Spanish fleet, it was largely destroyed by the weather. Despite having always been on an island, English policymakers only seriously began to appreciate Britain’s geographical potential for both defence and commerce in the late sixteenth century.

Overall, had the size or power of the state been the important factor in causing sustained economic growth, then the more likely candidate in 1550 would have been France. In terms of total annual tax revenues, France’s state was over four times the size of England’s. The states of Spain, the Ottoman Empire, and even teeny tiny Venice raked in more. And when we account for England’s low population, its performance in terms of tax revenue per capita was similarly poor. In the early 1600s the Dutch Republic collected twice as much tax as England, despite being less than half as populous. England only overtook France in per capita terms in the early 1700s, and even then still lagged far behind the Dutch.
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So Britain’s precocity would have seemed unlikely in 1550. But the exercise potentially also gives us a few clues as to what was important for growth. Indeed, 1550-1650 increasingly appears, to me, to be the crucial century. It was by 1650, for example, that a critical mass of influential inventors and scientists in England were already plotting the creation of what would become the Royal Society – one of the most important institutions in Europe for the promotion of useful technical and scientific knowledge. And it was by 1650 that London had become one of Europe’s largest cities, a major trading centre, and a hub of innovation. More on that another time.

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