From Dependency to Statism
In the mid -- nineteenth century, the differences of western and East- Central Europe were staggering. The gross national income of the central region reached just 40 percent of the West, but even this low rate blurs the real magnitude of backwardness. The western countries were well advanced in their capitalist development; the industrial share was 23 percent in France, 30 percent in Belgium, and 40 percent in Great Britain. The two seceding countries from the central region, Germany and Austria, rushed to catch up with the West. Just three decades later, the volume of per capita gross national product of a unified Germany already surpassed that of France; Austria, with Bohemia, reached the level of Holland and Sweden.
At the same point, East-Central Europe was still stuck in a rigid feudal and preponderantly agrarian system. Modern industry was practically absent. In partitioned Poland, neither the Prussian nor the Austrian and Russian occupiers tolerated the rise of any industrial competition. In Hungary, it was only in the 1840s that laws allowed nonnobles to establish some factories and, altogether,