The idea that the reach of the market is associated with the level of economic development, and that the expansion of markets leads to an increased division of labor and thus to economic growth, made Adam Smith one of the best known economists of all time. It has also become one of the most popular explanations for economic development since Smith first identified the link more than two hundred years ago. This concept of Smithian, or trade-led, growth, has thrived not only within academia but also in popular economics and in policy making around the globe. Yet the empirical evidence on when and how markets became integrated, and on whether, when, and under which circumstances expanding markets promoted economic growth, is actually amazingly thin and often ambiguous.

One of the main motivations for this book is thus to improve the empirical – or quantitative – evidence on the historical process of economic integration, which is a central variable not only in writings on Smithian growth but also in various large bodies of literature on economic development. A substantial amount of new price and wage evidence is thus presented for both Europe and India with the aim of assessing the size and efficiency of markets as well as the process of market integration over time.