The Leverhulme Lectures 2010. Professor Osamu Saito. Lecture 3.

All poor, but no paupers: a Japanese perspective on the Great Divergence

Professor Osamu Saito

Abstract

Ken Pomeranz’s The Great Divergence (2000), based mainly on Chinese evidence, argued that in the early modern period, the Asian standard of living was on a par with that of Europe and that market growth in East Asia was comparable to that in western Europe. The book has stimulated a major debate amongst economic historians and much progress has recently been made in cross-cultural comparisons of real wages. However, real differences between East and West cannot be properly understood unless household income, not just real wages, and income inequality, not just per-capita income, are compared; and due attention should be given, not only to product markets, but to factor markets as well. This lecture series examines these issues on the empirical basis of what Japan’s economic history can offer. The findings are not consistent with either Pomeranz’s account of East-West differences in living standards or with those presented in Bob Allen’s recent book.