Joel Mokyr: How the modern economy was born

MokyrBefore 1800, the majority of people lived on the verge of subsistence. In A Culture of Growth: The Origins of the Modern Economy, esteemed historian Joel Mokyr explains why in the industrialized world such a standard of living has grown increasingly uncommon. Mokyr offers a groundbreaking view on a culture of growth specific to early modern Europe, showing how the European Enlightenment laid the foundations for the scientific advances and pioneering inventions that would instigate explosive technological and economic development. Recently, Mokyr took some time to answer questions about the book.


How would you sum up the book’s main points?

JM: Before 1800 the overwhelming majority of humankind was poor; today in the industrialized world, almost nobody lives at the verge of subsistence, and a majority of people in the world enjoy living standards that would have been unimaginable a few centuries ago. My book asks how and why that happened. The question of the Great Enlightenment is central to economic history; a Nobel prize winning economist, Robert Lucas, once wrote that once we start thinking about it, it is hard to think of anything else.

Do we know how and where this started? 

JM: Yes, it started in Western Europe (primarily in Britain) in the last third of the eighteenth century through a set of technological innovations we now call the Industrial Revolution. From there it spread to the four corners of the world, although the success rate varied from place to place, and often the new techniques had to be adapted to local circumstances.

How is this book different from other work looking at this event? 

JM: The literature looking at the question of why this happened has advanced three types of explanations: geographical (looking at resources and natural endowments), political-institutional (focusing on the State and economic policies), or purely economic, through prices and incomes. My book examines culture: what did people believe, value, and how did they learn to understand natural phenomena and regularities they could harness to their material improvement.

Whose culture mattered most here? 

JM: Good question! Technological progress and the growth of modern science were driven first and foremost by a small educated elite of literate people who had been trained in medicine, mathematics and what they called “natural philosophy.” The culture of the large majority of people, who were as yet uneducated and mostly illiterate, mattered less in the early stages, but became increasingly important at a later stage when mass education became the norm.

So what was it about these intellectuals that mattered most? 

JM: In my earlier work, especially my The Enlightened Economy (2009), I pointed to what I called “the Industrial Enlightenment” as the central change that prepared the ground for modern economic growth. In the new book, I explain the origins of the Industrial Enlightenment. At some point, say around 1700, the consensus of intellectuals in Europe had become that material progress (what we were later to call “economic growth”) was not only desirable but possible, and that increasing what they called “useful knowledge” (science and technology) was the way to bring it about. These intellectuals then carried out that program through continuous advances in science that eventually found a myriad of economic applications.

How and why did this change happen? 

JM: That is the main question this book is focusing on and tries to answer. It describes and analyzes the cultural changes in the decades between Columbus and Newton, during what is sometimes known as “early modern Europe.” It was an age of tremendous cultural changes, above all of course the Reformation and the Scientific Revolution. Equally important was the emergence of what is known as “the Baconian Program,” in which Francis Bacon and his followers formulated the principles of what later became the Industrial Enlightenment. The success of these thinkers to persuade others of the validity of their notions of progress and the importance of a research agenda that reflected real economic needs is at the heart of the story of how the Industrial Enlightenment emerged.

So why did this take place in this period and in Europe, and not somewhere else? 

JM: Europe in this age enjoyed an unusual structure that allowed new and fresh ideas to flourish as never before. On the one hand, it was politically and religiously fragmented into units that fiercely competed with one another. This created a competitive market both for and among intellectuals that stimulated intellectual innovation. It was a market for ideas that worked well and in it the Baconian Program was an idea that succeeded, in part because it was attractive to many actors, but also because it was marketed effectively by cultural entrepreneurs. At the same time, political fragmentation coexisted with a unified and transnational institution (known at the time as the Republic of Letters) that connected European intellectuals through networks of correspondence and publications and created a pan-European competitive market in which new ideas circulated all over the Continent. In this sense, early modern Europe had the “best of all possible worlds” in having all the advantages of diversity and fragmentation and yet have a unified intellectual community.

Of all the new ideas, which ones were the most important? 

JM: Many new ideas played a role in the intellectual transformations that eventually led to the waves of technological progress we associate with modern growth. One of the most important was the decline in the blind veneration of ancient learning that was the hallmark of many other cultures. Shaking off the paralyzing grip of past learning is one of the central developments that counted in the cultural evolution in this period. The “classical canon” of Ptolemy and Aristotle was overthrown by rebels such as Copernicus and Galileo, and over time the intellectuals of this age became more assertive in their belief that they could outdo classical learning and that many of the conventional beliefs that had ruled the world of intellectuals in astronomy, medicine, and other fields were demonstrably wrong. Evidence and logic replaced ancient authority.

Was the success of the new ideas a foregone conclusion? 

JM: Not at all: there was fierce resistance to intellectual innovation by a variety of conservative powers, both religious and political. Many of the most original and creative people were persecuted. But in the end resistance failed, in large part because both people and books — and hence ideas — could move around in Europe and move to more liberal areas where their reception was more welcomed.

Could an Industrial Enlightenment not have happened elsewhere, for example in China? 

JM: The book deals at length with the intellectual development of China. In many ways, China’s economy in 1500 was as advanced and sophisticated as Europe. But in China the kind of competitive pluralism and diversity that were the hallmark of Europe were absent, and even though we see attempts to introduce more progressive thinking in China, it never succeeded to overthrow the conservative vested interests that controlled the world of intellectuals, above all the Mandarine bureaucracy. Instead of explosive growth as in Europe, Chinese science and technology stagnated.

Does the book have any implications for our own time? 

JM: By focusing on the social and economic mechanisms that stimulated and encouraged technological innovation in the past, my book points to the kind of factors that will ensure future technological creativity. First and foremost, innovation requires the correct incentives. Intellectuals on the whole do not require vast riches, but they will struggle for some measure of economic security and the opportunity to do their research in an environment of intellectual freedom in which successful innovation is respected and rewarded. Second, the freedom to innovate thrives in environments that are internationally competitive: just as much of innovation in earlier times emerged from the rivalry between England, France, Spain and the United Provinces, in the modern era the global competition between the United States, the EU, China, and so on will ensure continuous innovation. International competition and mobility ensure the intellectual freedom needed to propose new ideas. Finally, global institutions that share and distribute knowledge, as well as coordinate and govern intellectual communities of scientists and innovators across national boundaries and cultural divides, are critical for continued technological progress.

Joel Mokyr  is the Robert H. Strotz Professor of Arts and Sciences and professor of economics and history at Northwestern University, and Sackler Professor at the Eitan Berglas School of Economics at the University of Tel Aviv, Israel. He is the recipient of of the Heineken Prize for History and the International Balzan Prize for Economic History. Mokyr’s other works include The Enlightened Economy and the Gifts of Athena: Historical Origins of the Knowledge of Economy. His most recent book is a Culture of Growth: The Origins of the Modern Economy.

A Q&A with Cormac Ó Gráda, author of Eating People is Wrong

Cormac Ó Gráda’s new collection of essays on famine—which range in focus from from the economic history to the psychological toll—begins with a taboo topic. Ó Gráda argues that cannibalism, while by no means a universal feature of these calamities, has probably occurred more frequently than previously recognized. Recently he answered some questions on his book, Eating People is Wrong, and Other Essays on Famine, Its Past, and Its Future, its somber title, and his early interest in The Great Irish Famine.

O'Grada jacketWhy did you write this book?

CÓG: When Famine: A Short History (Princeton, 2009) came out, I wanted it to be my last book on the subject. So Eating People is Wrong was not a question of ‘what will I do next?’ I just realized a few years later that I had still had ideas to contribute on topics that would make for a new, different kind of book on famine. These topics ranged from famine cannibalism to the Great Leap Forward, and from market failure to famine in the 21st century; the challenge was to merge the different perspectives that they offered into what would become this new book.  The idyllic résidence I spent in the south of France courtesy of the Fondation des Treilles in the autumn of 2013 was when the different parts came together. By the end of that stay, I had a book draft ready.

What inspired you to get into your field?

CÓG: It is so long ago that I am bound to invent the answer… But I have always had an amateur interest in history—as lots of Irish people tend to have—whereas my academic training was in economics. Economic history seemed a good way of marrying the two, and that has been my chosen field since my time as a graduate student in the 1970s. I began as a kind of jack-of-all-trades economic historian of Ireland, focusing on topics as different as inheritance patterns and famine, or migration and banking. This work culminated in a big economic history of Ireland in 1994. My interest in the Great Irish Famine of the 1840s goes back to my teens, but that interest was sharpened after getting to know Joel Mokyr (also a PUP author) in the late 1970s. Economics taught me to think of the Irish in comparative terms, and that led eventually to the study of famines elsewhere. My books have all been solo efforts, but I have very lucky and privileged to write papers with some great co-authors, and some of these papers influenced the books.

How did you come up with the title or jacket?

CÓG: The title is an ironic nod to Malcolm Bradbury’s eponymous novel (which most people seem ignorant of). A friend suggested it to me over a pint in a Dublin bar. One of the themes of the chapter on famine cannibalism, to which the title refers, is the need to realize that famines not only do terrible things to people, but that people do terrible things to one other in times of famine. Peter Dougherty and his team at PUP came up with jacket. The image is graphic and somber without being sensationalist, which is what I had hoped for.

What is your next project?

CÓG: There is no single all-consuming project. A lot of my research in recent years has been collaborative work on British economic history with UCD colleague Morgan Kelly. So far the results of that work have appeared—when we are lucky—in academic journals rather than in books. We have plans to continue on this basis, but we are also involved in an interesting piece of research with Joel Mokyr on the origins of the Industrial Revolution, and that may eventually yield a monograph by the three of us. I also want to revise several unpublished papers in Irish economic history and to get them published singly or, perhaps, as a monograph. Finally, Guido Alfani of Bocconi University in Milan and I are editing a book on the history of famine in Europe. This is coming along well. The end product will consist of nine specialist country chapters, a cross-country analysis of the famines of World War II, and an overview by Alfani and me.

What are you currently reading?

CÓG: I am at page 630 (so another hundred or so pages to go) of Stephen Kotkin’s Stalin, vol. 1 (Penguin, 2014), which brings the story of Iosif Vissarionovich only as far as 1928. I have been interested in Soviet economic history since the late Alexander Erlich introduced me to the topic in Columbia in the 1970s, and this is what attracted me to Kotkin’s riveting tome—which, however, turns out to rather uninterested in the economic issues! I am also reading Maureen Murphy’s Compassionate Stranger: Asenath Nicholson and the Great Irish Famine (Syracuse, 2015), an account of an eccentric but appealing American evangelist who toured Ireland, mostly on foot, in the years leading up to and during the Great Hunger. I was familiar with Nicholson’s own published accounts of her travels, but knew very little about her otherwise, so Murphy’s book is a revelation.   My current bedtime reading is Henning Mankell’s The Man from Beijing (2010).

Cormac Ó Gráda is professor emeritus of economics at University College Dublin. His books include Famine: A Short History and Black ’47 and Beyond: The Great Irish Famine in History, Economy, and Memory (both Princeton).

Butting Heads (and iPhones): Economists Robert Gordon and Joel Mokyr Duke it Out in the Wall Street Journal

Photo Credit: WSJ.comNorthwestern Professors of Economics Robert Gordon and Joel Mokyr just can’t seem to get along.

In this past weekend’s edition of The Wall Street Journal, the two voice some distinctly adverse ideas about technological innovation in the twenty-first century – on the one hand, its success, and on the other, its stagnation.

Professor Mokyr, author of The Gifts of Athena: Historical Origins of the Knowledge Economy and co-author of The Invention of Enterprise: Entrepreneurship from Ancient Mesopotamia to Modern Times is an economic historian who’s altogether positive about the economic direction of the world-at-large. But this isn’t just blind optimism; in fact, it’s due in large part to the rapid rate of technological innovation. Mokyr notes that “new tools have led to economic breakthroughs,” and that since the field of technology is vast and unremitting, we’re hardly in danger of economic collapse.


“The divergent views are more than academic. For many Americans, the recession left behind the scars of lost jobs, lower wages and depressed home prices. The question is whether tough times are here for good. The answer depends on who you ask.”


But Professor Gordon, a macroeconomist and author of the forthcoming book Beyond the Rainbow: The American Standard of Living Since the Civil War (Princeton), and of the best-selling textbook, Macroeconomics, is hugely skeptical of such theories. He asks us to compare useful and revolutionary objects, like the flushing toilet, to the newest iPad; the former, already invented, is indispensable. Everything created thereafter is simply excess – the cherry on top, if you will. And, as new developments become only incrementally more advanced than their predecessors, technological progress will slowly grind to an anticlimactic halt.

The op-ed also gives some interesting background on both Gordon and Mokyr and tries to posit the origins of their respective beliefs, whether positive or negative. Despite their conflicts, the two can concede to one point: that the twenty-first century is unarguably the best time to be born, and the revelation is certainly an encouraging one.

Zoltan Acs on “Why Philanthropy Matters”

…For wealth to invigorate the capitalist system it needs to be “kept in rotation” like the planets around the sun, and for this task American philanthropy is very well suited. Examining the dynamics of American-style capitalism since the eighteenth century, philanthropy achieves three critical outcomes. It deals with the question of what to do with wealth–keep it, tax it, or give it away. It complements government in creating public goods. And, by focusing on education, science, and medicine, philanthropy has a positive effect on economic growth and productivity. Individuals such as Benjamin Franklin, Andrew Carnegie, Bill Gates, Michael Bloomberg and Oprah Winfrey have used their wealth to establish institutions and promote knowledge, and philanthropy has given an edge to American-style capitalism by promoting vital forces–like university research–necessary for technological innovation, economic equality, and economic security.

Philanthropy is therefore an invisible, underappreciated force for progress in American-style capitalism–the secret ingredient that fails to get mentioned in economic accounts of capitalism…

Source: “Why Philanthropy Matters” at History News Network

 

Zoltan Acs has a great article on the themes of his forthcoming book Why Philanthropy Matters over at History News Network.

bookjacket

Why Philanthropy Matters
How the Wealthy Give, and What It Means for Our Economic Well-Being
Zoltan J. Acs

 

New and Forthcoming Titles in Economics and Finance

catalog coverAre you at the annual Allied Social Science Associations meeting in Denver this week?  We invite you to check out our new line-up of titles.  You can now find our new 2011 Economics and Finance catalog online at:

http://press.princeton.edu/catalogs/econ11.pdf

You will find books by Raghuram G. Rajan, Max H. Bazerman & Ann E. Tenbrunsel, John Quiggin, Kaushik Basu and Diane Coyle, just to name a few.  And if you’re at ASSA on Saturday, we hope to see you at the Popular Economics panel discussion moderated by Princeton University Press’s Director, Peter J. Dougherty.

Popular Economics Panel with:

Robert Shiller (Yale University)
Robert Frank (Cornell University)
Diane Coyle (Manchester University)
Steve Levitt (University of Chicago)
Panel Moderator: Peter Dougherty (Princeton University Press)

Jan 08, 2011 8:00 a.m., Sheraton, Governor’s Square 15

Stop by and visit booth no. 311 to say hello and browse the books.  We look forward to seeing you there. For a free e-mail notification about new titles in Economics and Finance, sign up at:
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New and Forthcoming Titles in History

history catalog coverIntroducing our new 2011 History catalog:
http://press.princeton.edu/catalogs/history11.pdf
We invite you to browse and download the catalog.

There are many new titles this year to check out.  Our catalog cover image features The Whites of Their Eyes: The Tea Party’s Revolution and the Battle over American History by Jill Lepore.  This book tells the story of the centuries-long struggle over the meaning of the nation’s founding, including the battle waged by the Tea Party, Glenn Beck, Sarah Palin, and evangelical Christians to “take back America.”

You will also enjoy checking out Mumbai Fables by Gyan Prakash.  It is a sweeping cultural history of India’s largest city.  Other highlights in the catalog include titles by Louis Hyman and Margot Canaday in the Politics & Society in Twentieth-Century America series.  You can find titles by Thomas J. Sugrue, James T. Kloppenberg, Julian E. Zelizer, Emma Rothschild and many more in the history catalog.  From U.S. history to Asian history, the catalog covers the globe.

If you’re attending #AHA2011 in Boston this week, please make sure to stop by our booth no. 420 to say hello and browse the books.

You can also learn about new books by signing up for our e-mail notification service at:
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Your e-mail address will remain strictly confidential.