Traditional economics and consequently neo-liberal policy, especially in terms of economic development, relies on a Eurocentric approach to the narrative of systems of accumulation. In some ways this makes sense, all theory is based on what we know of history; however, to pretend that unindustrialized countries can industrialize in the same manner, following the same principles of Western Europe is to ignore some very pertinent facts.
The Eurocentric narrative of industrialization likes to pretend that it was only with the development of mercantilism, European exploration, and the resultant exploitation of the resources and peoples of the rest of the world that other regions were connected to the world economy. During what is regarded, in a Eurocentric perspective, as “The Dark Ages,” the rest of the global economy was thriving.
Trade routes existed all over Southern Asia, the Middle East, and Northern Africa, between the Eastern African coast and the Indian subcontinent, and the Pacific Islands. European nation states participated in this exchange of goods and services, but only in a limited capacity as the exporters of raw materials such as wool and timber. The highest degree of technology at the time existed in the Indian textile industry and the financial markets of the Middle East.
Despite some border skirmishes, the regions involved in the global markets of the thirteenth and fourteenth centuries existed in relative peace – albeit under the brutal thumb of the Mongol empire – until the Portuguese rounded Africa and threw the Indian Ocean trade routes into bloody chaos in the fifteenth century. This disruption impacting a functional, advanced economy by emerging European powers was the first of many in the next century.
Another fact that the Eurocentric economic history on which current neo-liberal development policy likes to ignore is that the massive capital inflows that kick-started the Industrial Revolution in England were a direct result of the slave trade and other exploitive mercantilist policies. Of course there were particular factors that enabled technological innovation in England rather than say, Spain, which despite the unprecedented riches it drained from Latin America, faced financial crisis rather than growth during the same time period; however to simply attribute the industrial revolution to the “ingenious, hardworking” Englishman is silly and dangerous.
Whom should today’s developing nations rob and enslave to fund the construction of their infrastructure and to reward technological innovation? We need systems of development that take not only the history of the victors, but the history of the exploited into account.
There are many moments in history that must be reexamined from multiple angles in order to learn their significance for future progress. I believe that reexamining the foundations of modern economics must begin long before Adam Smith. Understanding that trade and complex financial systems existed entirely separate from European development, and that development up to this point has been built upon a foundation of exploitation is a good place to start.