From 1000AD to 1970 the History of World Trade is Based on Fact, After 1970, Fiction?

[Cross Posted from the History of Economics Playground – original here]

Having just started Findlay and O’Rourke’s mammoth history of world trade in the second millenia, I have been struck by a strange incongruity. From before year 1000 and onwards the introduction is all about data, politics and the co-mingling of influences. Then you get to the 1970s and the data seems to be replaced with two very generic statements, and fiction on the effect of recent trade reforms (p. xxv).

  1. The period from 1970 onwards “was to a large extent dominated by the attempt of newly independent countries to industrialize through policies of import substitution” …
  2. “however, the period also saw the unpredecented expansion of world output and trade as a result of trade liberalization and growth in the industrial countries, and technological diffusion to newly industrialised countries”.

There’s a lot to unpack, but saying that the growth in developed countries who imposed trade liberalisation through the Washington Consensus aid packages may indeed have helped those nations grow is not exactly great stuff. The statistics seem to show that these countries grew faster from 1950 to 1970 anyways. Developing countries who did active import substitution like Japan in the 1950s and then the two waves of Asian tigers in the 1970s and then 80s grew really fast (cf. Chang’s Kicking away the ladder) while ‘liberalised’ latin american (with Argentina as the posterboy for these reforms) would bankrupt itself in and after their the lost decade. I’m expecting more when i make it to that chapter, and hope that 970 years of what looks to be serious history and good reading, won’t be ruined by 30 years of fiction. I’ll let you know in 500 pages, but if anyone has made it there already, then comments on the back of a postcard!