security. There was also little railway development in Austria-Hungary outside of Austria and the western parts of the empire, though the 1848 Revolutions had brought change to these territories, particularly the abolition of serfdom.
Absolutism reigned not just in much of Europe but also in Asia, and similarly prevented industrialization during the critical juncture created by the Industrial Revolution. The Ming and Qing dynasties of China and the absolutism of the Ottoman Empire illustrate this pattern. Under the Song dynasty, between 960 and 1279, China led the world in many technological innovations. The Chinese invented clocks, the compass, gunpowder, paper and paper money, porcelain, and blast furnaces to make cast iron before Europe did. They independently developed spinning wheels and waterpower at more or less the same time that these emerged at the other end of Eurasia. In consequence, in 1500 standards of living were probably at least as high in China as they were in Europe. For centuries China also had a centralized state with a meritocratically recruited civil service.
Yet China was absolutist, and the growth under the Song dynasty was under extractive institutions. There was no political representation for groups other than the monarchy in society, nothing resembling a Parliament or a Cortes. Merchants always had a precarious status in China, and the great inventions of the Song were not spurred by market incentives but were brought into existence under the auspices, or even the orders, of the government. Little of this was commercialized. The grip of the state tightened during the Ming and Qing dynasties that followed the Song. At the root of all this was the usual logic of extractive institutions. As most rulers presiding over extractive institutions, the absolutist emperors of China opposed change, sought stability, and in essence feared creative destruction.
This is best illustrated by the history of international trade. As we have seen, the discovery of the Americas and the way international trade was organized played a key role in
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