jewellery, and weapons. Most of this went to domestic consumption. This did
not indicate high incomes for ordinary people but instead a (Mughal) state that
was able to squeeze revenue from agriculture and with it the incomes of the
poorest agricultural workers and divert it to consumption by the upper classes.
Maddison estimates that the various taxes on agriculture and land were equiv-
alent to a third or more of gross crop production and represented about 15–18
per cent of GDP which was large by European standards of the time. Income
distribution is notoriously difficult to estimate but must be considered when
trying to draw inferences about typical standards of living.
Pomeranz (2000) also argues that China had more freely functioning factor
markets than did Western Europe after 1500 and that this implied higher
incomes in China. Land was freely alienable (marketable) in China in the mid-
1500s and by comparison entailed (constrained to be inherited by a direct
descendent and not sold) in much of Western Europe. He also argues that long-
distance migration of labour exceeded 10 million people in China between
1600 and 1800,but in Western Europe it was constrained by the enduring
feudal obligations that tied labour to land. Others disagree strongly with these
conclusions. Roberts (1985) argues exactly the opposite, suggesting that by
1500 most of Western Europe was experiencing a ‘general liberation’ of the
economy marked in particular by a free(er) market and price mechanism.
Landes (1998) notes that by 1500 there were few serfs left in north-western
Europe and the labour market was correspondingly free(er). Either way the
problem with using this as proxy evidence for income comparisons is that free
markets are not and never have been enough to generate income growth. This
book makes a clear case throughout that markets need be combined with other
factors such as good institutions, the plunder from colonization, a scientific
revolution,or many other factors to generate long-term economic growth.
Wages are commonly used in this debate as a proxy measure for more
general living standards. Parthasarathi, for example, argues that eighteenth-
century South Indian labourers had higher and more stable wages than their
counterparts in Britain. Wages, though, cover only a small fraction of the
(employed) population and miss the poorest (subsistence peasants), the richest
(lords living on rents) and the indeterminate (self-employed living on profits).
So in reality the link between wages and general living standards is much more
uncertain than many economic historians allow for.
Parthasarathi finds that in Britain a textile worker’s weekly earnings bought
40 to 140 pounds of grain and in South India between 65 and 160 pounds of
grain equivalent (1998:84). When adjusting for weeks of employment
Parthasarathi argues that this increases the advantage of South Indian textile
workers who had more consistent work. To support this latter point he finds a
1739 quote from an employee of the English East India Company who
suggested that ‘the demand for South Indian cloth was greater than all the
weavers in the country could manufacture’ and also that rice cultivation barring
a few unusual years between 1725 and 1735 was ‘a very secure enterprise’.
Given that later Parthasarathi criticizes the implicit prejudice and ignorance of
The Great Divergence since 1750 151