section_path: Causes/Causes in Europe
section_name: Causes in Europe
paragraph_text: Causes in Europe
  
  One question of active interest to historians is why the Industrial Revolution occurred in Europe and not in other parts of the world in the 18th century, particularly China, India, and the Middle East (which pioneered in shipbuilding, textile production, water mills, and much more in the period between 750 and 1100), or at other times like in Classical Antiquity or the Middle Ages. A recent account argued that Europeans have been characterized for thousands of years by a freedom-loving culture originating from the aristocratic societies of early Indo-European invaders. Many historians, however, have challenged this explanation as being not only Eurocentric, but also ignoring historical context. In fact, before the Industrial Revolution, "there existed something of a global economic parity between the most advanced regions in the world economy." These historians have suggested a number of other factors, including education, technological changes (see Scientific Revolution in Europe), "modern" government, "modern" work attitudes, ecology, and culture.
  
  China was the world's most technologically advanced country for many centuries; however, China stagnated economically and technologically and was surpassed by Western Europe before the Age of Discovery, by which time China banned imports and denied entry to foreigners. China was also a totalitarian society. It also taxed transported goods heavily. Modern estimates of per capita income in Western Europe in the late 18th century are of roughly 1,500 dollars in purchasing power parity (and Britain had a per capita income of nearly 2,000 dollars) whereas China, by comparison, had only 450 dollars. India was essentially feudal, politically fragmented and not as economically advanced as Western Europe.
  
  Historians such as David Landes and sociologists Max Weber and Rodney Stark credit the different belief systems in Asia and Europe with dictating where the revolution occurred. The religion and beliefs of Europe were largely products of Judaeo-Christianity and Greek thought. Conversely, Chinese society was founded on men like Confucius, Mencius, Han Feizi (Legalism), Lao Tzu (Taoism), and Buddha (Buddhism), resulting in very different worldviews. Other factors include the considerable distance of China's coal deposits, though large, from its cities as well as the then unnavigable Yellow River that connects these deposits to the sea.
  
  In contrast to China, India was split up into many competing kingdoms after the decline of the Mughal Empire, with the major ones in its aftermath including the Marathas, Sikhs, Bengal Subah, and Kingdom of Mysore. In addition, the economy was highly dependent on two sectors — agriculture of subsistence and cotton, and there appears to have been little technical innovation. It is believed that the vast amounts of wealth were largely stored away in palace treasuries by monarchs prior to the British take over.
  
  Economic historian Joel Mokyr argued that political fragmentation, the presence of a large number of European states, made it possible for heterodox ideas to thrive, as entrepreneurs, innovators, ideologues and heretics could easily flee to a neighboring state in the event that the one state would try to suppress their ideas and activities. This is what set Europe apart from the technologically advanced, large unitary empires such as China and India by providing "an insurance against economic and technological stagnation". China had both a printing press and movable type, and India had similar levels of scientific and technological achievement as Europe in 1700, yet the Industrial Revolution would occur in Europe, not China or India. In Europe, political fragmentation was coupled with an "integrated market for ideas" where Europe's intellectuals used the lingua franca of Latin, had a shared intellectual basis in Europe's classical heritage and the pan-European institution of the Republic of Letters. Political institutions could contribute to the relation between democratization and economic growth during Great Divergence.
  
  In addition, Europe's monarchs desperately needed revenue, pushing them into alliances with their merchant classes. Small groups of merchants were granted monopolies and tax-collecting responsibilities in exchange for payments to the state. Located in a region "at the hub of the largest and most varied network of exchange in history", Europe advanced as the leader of the Industrial Revolution. In the Americas, Europeans found a windfall of silver, timber, fish, and maize, leading historian Peter Stearns to conclude that "Europe's Industrial Revolution stemmed in great part from Europe's ability to draw disproportionately on world resources."
  
  Modern capitalism originated in the Italian city-states around the end of the first millennium. The city-states were prosperous cities that were independent from feudal lords. They were largely republics whose governments were typically composed of merchants, manufacturers, members of guilds, bankers and financiers. The Italian city-states built a network of branch banks in leading western European cities and introduced double entry bookkeeping. Italian commerce was supported by schools that taught numeracy in financial calculations through abacus schools.