------------ EH.NET BOOK REVIEW -------------- 
Published by EH.NET (April 2005) 
 
Peter Bernholz and Roland Vaubel, editors, _Political Competition,  
Innovation and Growth in the History of Asian Civilizations_.  
Cheltenham, UK: Edward Elgar. 2004. xii + 225 pp. $100 (cloth), ISBN:  
1-84376-919-0. 
 
Reviewed for EH.NET by Stanley L. Engerman, Department of Economics,  
University of Rochester. 
 
 
One of the more interesting ideas to come out in the re-emergence of  
long-term comparisons of the economic growth of Europe in contrast  
with Asia is the role of political fragmentation in explaining the  
success of Europe. Expressed most clearly in Jean Baechler's _The  
Origins of Capitalism_ and then in Eric Jones's _The European  
Miracle_, the argument resembles a political interpretation that  
follows the lines of economists' belief in the advantages of perfect  
competition in industrial markets. The advantages of having several  
competitors and having constraints imposed by other firms, which  
influence behavior in a desirable direction, suggest that having  
several nations rather than one empire would be advantageous for  
economic growth. 
 
These ideas are, as claimed by this volume's editors, an independent  
recapturing of arguments made by David Hume (1742) and Immanuel Kant  
(1784) on why Europe developed more rapidly than Asia. Since Europe,  
particularly a Western Europe composed of several different nations,  
had emerged as the world leader, the idea, then as now, has some  
degree of plausibility, particularly since Asia was considered to be  
composed primarily of a small number of large empires. The idea of  
the editors, and the basis of a conference held in Heidelberg in  
September 2002, including as contributors historians, sociologists,  
economists and a socio-psychologist, is to provide a more direct test  
of the hypothesis by examining the four major Asian empires -- China,  
Japan, India, and the Middle East -- to determine the broader role of  
political fragmentation. While that is the primary intent of the  
volume described by the editors, a key set of arguments are broader,  
asking more generally why none of the Asian nations achieved modern  
European growth rates for a prolonged period. 
 
The volume includes three general essays on creativity and  
fragmentation, with four Asian case studies. Dean Keith Simpson, a  
social psychologist, uses earlier estimates of Asian creativity, to  
argue for the importance of political fragmentation and also of  
cultural homogeneity. Jean Baechler reviews the debate on the  
hypothesis claiming that it "is not a yardstick to be applied rigidly  
and mechanically ... but a hypothesis and a method of inquiry." The  
essay by the editors provides some background to the general  
arguments and the case studies presented, arguing for the importance  
of geographic mobility, religious diversity, political stability,  
peace, and "institutional pluralism within the political units." The  
studies of India by Deepak Lal and of the Islamic Middle East by  
Timur Kuran, contend that these two societies were too monolithic to  
have achieved sustained growth. The other two case studies, of China  
by Pak Hung Mo and Japan by G=FCnther Distelrath, point to the  
drawbacks of centralized control in China and the difficulties  
confronted by Japan at times of "total decentralization." 
 
The conclusions drawn from these studies are generally based upon  
comparing periods of creativity or economic growth of the Asian  
nations over a long period, with the extent of changes in degree of  
political fragmentation. As might be expected the specific  
conclusions are rather mixed, political fragmentation helping to  
explain bursts of creativity in some cases, but not in others. Each  
of the studies does provide much interesting information and insights  
for the non-Asian specialist. The usefulness of the volume is helped  
by the inclusion of comments made on each of the articles by other  
scholars who attended the conference. 
 
As Eric Jones suggests in the introduction, a point reiterated by  
most contributors, the evidence presented "suggests amending rather  
than abandoning the hypothesis," as "the new notion in more qualified  
than before." To advance this discussion, it will be interesting to  
examine several more case studies to broaden our knowledge. Was, for  
example, Africa over-fragmented, with the population of small states  
leading to an inability to exercise power against Europeans and also  
leading to conditions favorable to wars and the sale of war captives  
elsewhere to be slaves? Did the transition in South America in the  
early nineteenth century do more to facilitate growth than the  
previous unified empire of the Spanish? This expansion of case  
studies will be useful, since if political fragmentation can spur  
cultural and economic growth, but only under certain conditions, it  
will be helpful to learn more about what such conditions were. 
 
It would also be interesting to follow the logic of the underlying  
economic argument to determine what the optimum degree of  
fragmentation would be. Too much centralization can be limiting, as  
would too much fragmentation, which can be at the cost of political  
stability. The cost of fragmentation in Europe is given less  
attention than the frequency of warfare among those nations might  
suggest, as are the costs of the mercantilist policies that all  
European nations followed. The deaths of millions in warfare may have  
been the outcome of policies related to the benefits of  
fragmentation, which is to say that fragmentation into different  
nation-states was not costless. 
 
 
Stanley L. Engerman is John Munro Professor of Economics and  
Professor of History at the University of Rochester. 
 
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