The Implications of England’s Economic Development for Today’s International Community
England, like many other countries during the medieval era, had an autocratic, self-interested government. In many cases, England’s economic policies were inefficient and anticompetitive, which delayed economic growth. However, by the early 1700s, England became the leader in economic development. Many scholars questioned why England was the first to develop as greatly as it did during the 1700s as opposed to other powerful countries like France and Spain. In The Rise of the Western World: A New Economic History, Douglass C. North and Robert Paul Thomas shed light on how England developed an efficient economic system. Eventually, the authors accredited England’s Parliament as the main driver for the dramatic economic change to an efficient market in England. Thus, the authors imply that monarchies’ power needs to be checked or curbed in order for efficiency and growth to occur in the economy. If the authors are correct, what should be the international community’s economic policy for developing countries around the world seeking financial aid? Based on the case study, the international community should determine if the developing country has the appropriate governmental infrastructure, a form of checks and balances, and efficient property rights before it aids the country. By doing so, it can ensure a safe and healthy possibility of economic growth within its borders. How did early monarchies in England violate property rights and delay economic growth? The authors argue that it is universally true that property rights within a country must first be protected and well-defined in order to encourage innovation and a healthy, efficient economy. According to the authors, exclusive privileges and monopolies granted by the monarchy failed to protect property rights. Although these policies protected certain individuals, they negatively impacted the overall economy (North & Thomas 153). Basically, the monarchy endorsed, facilitated and participated in anticompetitive activities, which opposed efficiency. Specifically, the Crown offered exclusive privileges and patent monopolies to a few, which included rewarding royal favorites, drastically limiting competition and postponing economic growth. Countries who currently exhibit nepotism and anticompetitive activities should not be given financial aid because it would fall into the wrong hands and not be equally distributed. Another way the monarchy did not protect property rights was the lack of support for enclosure policies. Private property cannot be truly established until there are well-defined laws regulating and legalizing ownership of land or property. Many contemporary countries continue to have poorly defined and protected property rights. This situation can be seen in England’s history. Early monarchies, such as during the Tudor era, were opposed to establishing enclosures. The main reason was because it would cause a great redistribution of wealth (land): “Where an enclosure involved significant redistribution of wealth…it led to widespread rioting and even open rebellion” (North & Thomas 150). Many of the underprivileged had been cultivating and planting crops in lands of lords and nobles that were given to them during the feudal era. Enclosures would mean convert from feudal property to private property, which would transfer a lot of the land the monarchy and the privileged nobles owned to the underprivileged who had cultivated their lands for many years. It is important to note that these violations were not pareto efficient because lack of competition allowed for a few to abuse and manipulate the markets. This leads to misallocation of resources in both the factor and product markets, which caused inefficient markets. This contributes significantly to stagnant or slow growing economies around the world. The obvious logic for violating private property and endorsing...
Cited: North, Douglass C., and Robert P. Thomas. "The Rise of the Western World: A New Economic History." Cambridge. 1973.
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