ABSTRACT
IN the century between the Napoleonic and First World Wars a world economy, based on western Europe, was built. Two aspects of this process may be distinguished. On the one hand, the various regions were successively integrated in a world-wide economic and financial system, through mechanical transport, mass migration, vast capital flows and a huge expansion in international trade. And on the other, the economy of the non-European countries was profoundly transformed. Thanks to the spread of security, the introduction of modern hygiene and the reduction of famine, death rates fell and population increased severalfold. In response to rising European demand for raw materials and helped by a sharp reduction in transport costs, agricultural output greatly expanded and export of cash crops multiplied; this in turn had deep repercussions on systems of land tenure, generally resulting in a shift from communal or tribal ownership to individual property rights. Handicrafts, exposed to the competition of European machine-made goods, were for the most part eliminated; and since, for a variety of economic, social and political reasons, modern factories did not rise to take their place, a process of de-industrialization occurred in many parts of the world. Social systems were also transformed and the already great inequality prevailing in these countries increased. For although the level of living of the masses probably rose in most places over the greater part of the period, the income and wealth of the upper strata grew much more rapidly. Lastly, the active agents of change were mostly foreign—either Europeans or Americans or immigrants from neighbouring countries, e.g., the Chinese and Indians in south-east Asia.
