Development and Underdevelopment in the History of Economic Thought

The principal difference between Western and Central Europe is in economic development

Horvath Julius, Central European University

The principal difference between Western and Central Europe is in economic development. Empirical estimation of the performance of Central European economies show that the gap among Central and Western Europe had been increasing for most historical periods. Central European economists reacted to this gap by pointing to possible determinants of divergent development. One explanation of the gap in development argues that the differences were established already in the pre-capitalist times, another explanation would point to certain historical disrespect to property rights; nationalists would stress the foreign dominance, and other explanations also emerged. This paper will review these views through different historical epochs.

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Keywords: Development, Central Europe