Despite having limited borders, the European continent is home to some of the world's largest economies, demonstrating that becoming an economic power does not necessarily imply the possession of large territories or high quantities of raw materials. Today, in fact, European aggregate output amounts to about 25 percent of world GDP, including varied national economies.
But where does Europe's economic success come from?
Over the centuries, Europe has seen the succession of numerous wars, during which states were perpetually at odds with one another. It suffered severe famines and epidemics, which damaged crops and halved population numbers. However, European states have always managed to recover from these precarious situations by pursuing greater growth.
But how then do we explain the reason for European economic growth?
Considering that from 1500 to 1800 the great European powers were at war with each other for an average of 9 out of 10 years, it is hard to imagine how this continent could have grown economically, even considering the increasing destructive power of new military weapons.
However, as reported by a study conducted by Vorth and Voigtländer, professors at Pompeu Fabra University in Barcelona and UCLA Anderson School of Management (USA), respectively, together with the socially devastating plagues of epidemics and the consequences of urbanization that affected Europe during these centuries, conflicts contributed to the formation of the modern European economy. The constant wars, famines, and problems associated with urbanization were devastating phenomena that claimed large numbers of victims, decimating the populations of entire countries. While from a social and human point of view these events were destructive and disruptive to the population, from an economic point of view they allowed for greater development as the scarce labor force available made the wealth produced flow in the direction of the few survivors, whose standard of living improved, providing them with access to greater economic-labor resources.
Another factor at the origin of European economic growth can be traced to colonialism, a very complex phenomenon that had enormous negative consequences for the territories that suffered it, which were merely exploited by European powers; without forgetting that it also had positive implications for some areas, which developed further thanks to the capital flows arriving from European countries.
Specifically, "Colonialism fostered economic development in some parts of Europe and retarded it in others" (Acemoglu and Robinson, 2017), causing "The rise of Western Europe after 1500 to be largely due to the growth of countries with access to the Atlantic Ocean and substantial trade with the New World, Africa, and Asia. This trade and related colonialism influenced Europe not only directly, but also indirectly by inducing institutional changes" (Acemoglu, Johnson and Robinson, 2005).
In this regard, the development of colonialism had significantly different impacts depending on the colonial power: if, for example, Spain and Portugal had exploited the colonized territories based on superiority and force, resorting to violence on subordinate and non-subordinate populations, even promoting the development of the colonial territories, England had invested in the development of the colonized places, promoting their economic, cultural, social and political growth.
In this way, the colonization process not only served the acquisition of the raw materials of the colonial territories, but also promoted their development.
Also, of fundamental importance is the form of government in place in the sovereign territory at the time of colonial expansion: while the Spanish were ruled by an absolute aristocratic monarchy, to which all proceeds from colonial exploitation went, England, as a constitutional monarchy, possessed mechanisms for controlling sovereign power that did not allow the acquisition of the totality of colonial raw materials, thus contributing to the general welfare of society.
Other key and essential factors for the economic development of the European continent are the mild climate, the concentration of several and diverse states in a limited territory, and also the navigability of extensive rivers and a coastal geography characterized by gulfs and inlets that allowed the installation of ports and safe docking areas for maritime trade.
In conclusion, there are many factors that have driven Europe's economic development, incentivizing it to become an economic and trade hub for many economies internationally and contributing as much as 38 percent to global trade.
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Bibliography:
https://www.anderson.ucla.edu/faculty_pages/nico.v/Research/Horsemen_REStud.pdf
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L'Autore
Elisa Modonutti
Studentessa di Scienze internazionali e diplomatiche, amante della lettura, dei viaggi e con una curiosità innata di scoprire il mondo che ci circonda
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economic power europe economic geography Economics economic development