recently, economists carol shiue and wolfgang keller of the university of texas at austin published a study of "market efficiency" in the eighteenth century in england, other european countries, and china. if the markets in a country are efficient, a product should have the same price wherever in the country it is sold, allowing for the effect of transportation costs. if prices are not the same in two areas within a country, it is possible to make profits by buying the product where its price is low and reselling it where its price is high. this trading will drive prices to equality. trade is most likely to occur, however, if entrepreneurs feel confident that their gains will not be seized by the government and that contracts to buy and sell can be enforced in the courts. therefore, the more efficient a country's markets were, the more its institutions would have favored long-run growth. shuie and keller found that in 1770, the efficiency of markets in england was significantly greater than the efficiency of markets elsewhere in europe and in china. source: carol h. shiue and wolfgang keller, "markets in china and europe on the eve of the industrial revolution," american economic review, vol. 97, no. 4, september 2007, pp. 1189-1216. this finding supports douglas north's argument concerning why the industrial revolution occurred in england because