New Books in Economic and Business History Avner Greif et al., "Two Paths to Prosperity: Culture and Institutions in Europe and China, 1000–2000" (Princeton UP, 2025)
Apr 2, 2026
Guido Tabellini, Intesa Sanpaolo Chair in Political Economics and Vice President at Bocconi University, co-author of Two Paths to Prosperity. He contrasts European corporations with Chinese clans and traces how fragmentation, church policy, and kinship shaped institutions. He discusses the role of legal systems, the exam system’s limits on scientific accumulation, and whether centralized regimes can foster radical innovation.
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Great Reversal Between China And Europe
- The great divergence is a long-run reversal where China was ahead around year 1000 but later stagnated while Europe surged economically and politically.
- Guido Tabellini links this to diverging political institutions, social structures, and family patterns across centuries.
Fragmentation Gave Europe Escape Routes For Knowledge
- Early political unification in China produced strong unitary state institutions, while Europe's fragmentation allowed more inclusive institutions and escape from state control over knowledge.
- Tabellini argues fragmentation enabled Europe to accumulate independent knowledge and ultimately foster the Industrial Revolution.
Clans Versus Corporations As Local Governance
- Local public goods were supplied by non-state organizations: clans in China and corporations in Europe, shaped by cultural differences.
- Corporations were associations of unrelated individuals; clans were patrilineal dynasties, and these structural differences mattered for later institutions.
