Asia-Pacific Economic and Business History Conference, Berkeley, 2011 (Feb. 18-20): Preliminary Draft Institutional Differences and the Great Divergence:* Comparison of Joseon Kingdom with the Great Britain Soh, ByungHee Professor of Economics Kookmin University, Seoul, Korea e-mail:
[email protected] Abstract If modern Koreans in the 20th century could achieve a remarkable economic growth through industrialization, why couldn’t their ancestors in Joseon Kingdom in early modern period achieve an industrial revolution at that time? This is the fundamental question of this paper. There existed several social and institutional constraints in Joseon Kingdom (1392-1897 A.D.) in the 17th through 19th centuries that made her industrial development impossible. The strictly defined social classes and the ideology of the ruling class deprived Joseon Kingdom of the entrepreneurial spirit and the incentives to invent new technology necessary for industrial development. Markets and foreign trades were limited and money was not used in transaction until late 17th century. Technicians and engineers were held in low social esteem and there was no patent to protect an inventor’s right. The education of Confucian ethical codes was intended to inculcate loyalty to the ruling class Yangban and the King. The only way to get out of the hard commoner’s life was to pass the national civil service examination to become a scholar-bureaucrat. Joseon Kingdom was a tributary country to Qing Dynasty and as such it had to be careful about technological and industrial development not to arouse suspicion from Qing. Joseon was not an incentivized society while the Great Britain was an incentivized society that was conducive to Industrial Revolution.