de Vries, Jan. "The limits of globalization in the early modern world". The Economic History Review, Vol.63, No.3 (2010): 710-733.

De Vries, Jan. "The limits of globalization in the early modern world". The Economic History Review, Vol.63, No.3 (2010): 710-733.

• The author distinguishes between the interconnection of population and markets through intermediaries as described by Drs. Flynn and Giráldez, which he terms 'soft globalization', and the measurable economic results of this meeting as described by Drs. Williamson and O'Rourke, which he terms 'hard globalization' (711, 713-714).
• Some scholars of early globalization had experienced a split about how to account for the divergent success of Europe during the early modern period, mainly divided on the role of Asia in this transformation. The California School, on the other hand, argues against the question, holding that European standards of living did not exceed does in East Asia until the end of the 1700s, meaning no explanation is required (713).
• The author claims that no 'real' trade between Europe, the Americas, and Africa existed, since its form was always exploitative and colonial. As such, the author restricts his analysis to the volume of 'real' trade between Europe and Asia (715). The size of this trade expanded at around 1% per annum, with an expansion of 25 fold over the period between 1400 and 1700 (718).
• Compared to trade between Europe and the Americas, Asian trade seems almost stagnant. Trade with the Americas grew by around 5% annually and sugar imports alone accounted for 4 times the tonnage of all Asian goods in Europe in 1770s. Based on this information, the author rejects the idea of a 'boom' in European-Asian trade (718-719).
• The trade between Europe and Asia was not evenly distributed on either side. Asian goods were monopolized by the European elites as luxury items, whereas European goods and silver changed locations throughout this period, distributed unequally between India, Indonesia, and China (718).
• There is substantial evidence to suggest that increased presence of European traders in Asia resulted in the convergence of prices of Asian goods in Europe. Over time, these imports began substantially less profitable as competitors emerged in Europe and the Americas (719-722).
• With the exception of the Portuguese in the early 1500s, no European state or stock company has ever enjoyed a monopoly on the trade in Asian goods. All later companies competed with other European ventures for control over supplies to European markets and with Asian companies for control of valuable spices and luxury goods (724-725).
• The claims that European joint stock companies were highly profitable, or that their mercantilist policies kept Asian goods as a luxury of the elite, are false outside of very short periods of new market exploration. The prices of Asian goods gradually declined and by the 1700s even Western European poor could enjoy tea (725).
• The costs of Asian goods did remain high, and their distribution restricted to elites, in Central and Eastern Europe for many more years, as only a small number of goods from Atlantic trade ports even made it to Eastern European markets (725).
• Technological stagnation consistently bit into the profits of European trading companies, with their margins declining over time. The margin of profit from selling Asian goods consistently declined as competition increased, whereas the transport costs remained stable over centuries (726).
• European companies saw their decline in profits from competition during the 1600s and implemented two strategies to recoup losses. First, some companies, especially the Netherlandish, conducted an intra-Asian trade between India, Indonesia, and China, sending profits rather than luxury goods back to Europe (726). The second method was replacing trade revenue with taxation by conquering parts of Asia (727).
• The trends of lower profit margins for Asian goods, a result of competition from other supplies in the Americas or Europe, and consistently high transaction costs, caused by limits of naval technology and large bureaucracies, pushed European companies to increasingly adopt the taxation method of revenue, leading to the eventually creation of colonial systems in Asia (731).
• The greatest impact which trade with Asia likely had upon European markets was the transformation of European consumer goods to include Asian products. The high costs of transport led European countries to create alternative sources of these goods in Europe and the Americas, fundamentally changing global markets (729).
• Trade with Europe could only have had a regional or local impact on Asian markets. The volumes of goods purchased by Europeans and the amount of silver given to Asians — even the Chinese — from European trade was too small to make major differences in Asian economies (730).