Conclusion
The wage comparisons undertaken in this chapter support several important conclusions about living standards in preindustrial Europe and Asia.
First, wages expressed in grams of silver were lower in China and India than in Europe.
The views of the eighteenthcentury observers cited by Parthasarathi are confirmed. This is important since it was the proximate cause of Asia's competitive advantage in textiles and luxury manufactures and was, thus, the basis for Asian—European trade in the early modern period. Why these differentials persisted for hundreds of years is an important question in international and monetary economics that must be addressed to explain the dynamics of the world economy in this period.Second, low Asian silver wages were matched by low Asian prices with the result that living standards in Asia were similar to those in many parts of Europe.
Farm workers in Europe and urban workers in central and southern Europe did not enjoy higher living standards than their counterparts in Asia.
Third, some parts of Europe did generate higher real wages than we find in Asia. When real wages were at their peak following the Black Death, most Europeans had a higher standard of living. But this was a transitory condition for most of the continent. High wages persisted only in the commercial centres of the northwest—London and the Low Countries generally. During the eighteenth century, the provincial towns of England were drawn into the same high- wage orbit, but agriculture was left behind. This dynamic, urban economy was the engine of growth in early modern Europe, and Asia appears to have had no counterpart. It is possible, of course, that a more extensive Asian database would reveal a parallel: the absence of information on urban Chinese wages is particularly troubling in this regard. However, neither the Japanese cities nor the capital of the Mughal Empire had particularly high wages.
The evidence at hand suggests that Asia lacked Europe's engine of growth.This point may be put differently. The revisionist literature on Asia argues that it exhibited Smithian growth, just like Europe. This may be, but Smithian growth can be intense or moderate; it can lead to an industrial revolution, but it need not. The issues here were rehearsed in the debate about proto-industrialization, and Coleman's (1983) scepticism about its importance applies equally to Smithian growth.
Fourth, the wage data lend support to the classical notion of a ‘subsistence’ wage. Leaving aside Europe's transitory fifteenth-century real wage peak and the high wages generated by the commercial success of the northwest, most of the continent settled down to wage levels like those in Asia. Was this coincidence or were there demographic or other equilibrating processes that kept incomes at a similar level across Eurasia? Alternatively, were wages destined to be the same from Portugal to Japan unless the labour market was disrupted by a major demographic shock or by continuous growth in demand due to capital accumulation and technological advance?
Fifth, only in India was there evidence of falling real wages between the early modern period and the twentieth century. In China and Japan, they were constant or rising. There was a difference in living standards between Europe and Asia in the twentieth century because Europe pushed ahead, while growth in Asia was moderate in the extreme.
These conclusions are only as good as the wage and price data that underlie them, and for Asia they are weak, indeed. The International Price History Commission emphasized the importance of long series of wages and prices as the basis for sound economic history. One hundred years of research have blessed European historians with price histories that allow the measurement of market integration, inflation, and productivity, as well as the reconstruction of living standards across the continent. Global comparisons show the necessity of extending this research worldwide. Who will write the price histories of Delhi and Beijing, of Shanghai and Bombay?6