The Rise of Europe: Atlantic Trade, Institutional Change, and Economic Growth
Daron Acemoglu, Simon Johnson, James Robinson
American Economic Review · 2005 · Volume 95 · Issue 3
Abstract
The rise of Western Europe after 1500 is due largely to growth in countries with access to the Atlantic Ocean and with substantial trade with the New World, Africa, and Asia via the Atlantic. This trade and the associated colonialism affected Europe not only directly, but also indirectly by inducing institutional change. Where "initial" political institutions (those established before 1500) placed significant checks on the monarchy, the growth of Atlantic trade strengthened merchant groups by constraining the power of the monarchy, and helped merchants obtain changes in institutions to protect property rights. These changes were central to subsequent economic growth.
Keywords
Economic Growth of Open Economies, Economic History: Macroeconomics and Monetary Economics, Industrial Structure, Growth, Fluctuations: Europe: Pre-1913, Measurement of Economic Growth, Aggregate Productivity, Cross-Country Output Convergence
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