Source: Angus Maddison
Note: GDP is expressed in Geary-Khamis 1990 dollars therefore proportions are based on PPP not on absolute nominal figures. This better links GDP to living standards.
Primarily agrarian economies where economic might was based on extent of fertile land and size of population. Not surprisingly,
China and India with 50% of the world’s
population were behemoths accounting for more than half of the world economy.
Industrial revolution started in the mid-18th century in
The rapid increase in prosperity of UK
relative to Europe is reflected in the sharp rise in the share of UK to Western Europe’s GDP from 15% in 1700 to 26%
in 1820. The precipitous decline in India’s GDP followed the decline
of the Mughal empire after the death of Aurangzeb in 1707. It led to political
fragmentation, internecine warfare and the rise of the rapacious East India
Post-Napoleonic era and the rise of nationalism in
Europe. Industrialisation arrived alongside and led to a
spike in Europe’s share of world GDP. The hunt
for colonies gained importance and became easier due to technological progress.
China’s stagnant economy
couldn’t withstand the assault (First Opium War was in 1840) and followed India’s
decline. The US
also started to catch up post independence utilising its large landmass,
increasing population and benefits of industrialisation.
The zenith of imperial
Europe and British Raj with roughly 13% of world’s population accounting for 32% of world GDP. By now, western
Europe had also caught up with the UK
after German unification and industrialisation (as seen by the static share of UK in Europe’s
GDP). Tsarist Russia
was left far behind, which may have had a bearing on the things to come.
UK-German rivalry and an arms race began as the German economy challenged and finally overtook
around 1908. The balance of power shifted as can be seen by the first ever
decline in UK’s
share of European GDP since 1500. The seeds of the Great War were probably
sown. On the other side of the world, the US continued to move upwards. Lack
of industrialisation and colonialism meant India
were poor farmers in an urban society.
1913-1950Europe destroyed itself through two wars and the consequent transfer of wealth to the