Although China is discussed in Chapter 16, the real comparison between it and Western Europe is made in the Epilogue. I will discuss both chapters briefly.
In Chapter 16, Diamond is mainly concerned with why China is relatively unified. He does not compare it with Europe very much. Diamond argues that China was able to unify largely because of its geography. He notes that China does not have many barriers to the spread of crops and culture. It does have a north-south axis, but that axis does not have barriers like mountains and deserts. It also has long east-west rivers. These facts mean that it was relatively easy for culture to diffuse and make China homogeneous.
Part of the Epilogue is devoted to why China lost its edge over Western Europe. Diamond argues that this, too, is about geography. He says that Western Europe’s geography naturally causes it to be disunited. He says that Western Europe has many mountain ranges and rivers that break it up and make it hard for one culture or society to dominate it. China, by contrast, does not.
For these reasons, he argues, China has been more unified historically than Europe has been.