- A Farewell to Alms: A Brief Economic History of the World
At dinner one evening in California, Gregory Clark proclaimed that his publisher had vowed to put a copy of A Farewell to Alms in every airport bookstore in the nation; surely his book has provoked animated debates among passengers on planes, and it will continue to do so. The preface (yes, written by Clark) declares that “this book takes a bold approach to history . . . within a welter of often sketchy and sometimes conflicting empirical evidence,” and this is not mere bluster.
From the Stone Age until 1800 the history of the world was brief: progress was inhibited by a Malthusian mechanism that translated income gains into unsustainable population growth which drove the society back to subsistence level. The Industrial Revolution that first occurred in Britain permitted improvements in technology and income among Western countries without subsequent population crises, whereas other regions remained in the Malthusian era. This creates a continuing divergence in living standards across the globe. How to account for these patterns? Many economic historians agree that appropriate institutions—secure property rights, democracy, legal and political rules that reward productivity rather than rent-seeking, unregulated markets within and across countries, policies that promote innovation and human capital formation—account for the advances in knowledge capital and economic welfare. More nihilistic commentators argue that luck or random exogenous events determine the growth trajectory.
Clark’s exposition for the most part integrates standard economic models and accepted cliometric findings, but he concludes that institutional explanations are deficient. Other societies, notably China and Japan, created favorable institutions without achieving an industrial revolution, and [End Page 779] Britain itself possessed such institutions long before the nineteenth century. In a Weberian twist, Clark contends that England’s success owed to salient changes in the character and culture of the English. The catalyst was a quasi-Darwinian process that fortuitously ensured the survival of the richest and their “bourgeois virtues” (a concept borrowed from Deirdre McCloskey) of discipline, deferred consumption, nonviolence, and newspaper subscriptions. These elements alchemized the levers to spring the Malthusian trap, facilitating lower interest rates, innovation, and a more reliable workforce. Clark’s study of bequests between 1585 and 1638 indicates enhanced reproductive success among wealthier Englishmen, and subsequently among their offspring. Such “bedroom labors” resulted in downward mobility across generations, and the diffusion of the behavioral traits of the rich to the lower classes. This thesis comprises Clark’s most novel contribution, and least credible, given that the critical mechanisms or carrier genes that transmit from father to son a tendency to become a workaholic are unidentified.
The final section of A Farewell to Alms explores the nature and causes of the “Great Divergence” that led to heightened inequality across nations. Poor countries experience low total factor productivity (output deflated by all inputs) not because of defective governance or deficient institutions or lack of resources. Instead, their unenviable fate is determined by their “bad attitudes,” or their inability to replicate the bourgeois virtues of nineteenth century England, as witnessed by the “socially induced lethargy that afflicted Indian labor” (p. 365). Aid and other forms of benevolence simply engender impoverishing population growth; transferred technologies will be abandoned during long siestas; human capital investments are dissipated in the vortex of cultural and institutional inadequacy. As such, the common policy instruments advocated for achieving progress in today’s developing countries will invariably prove to be ineffective. The residents of Malawi are better advised to abandon the land of their birth and migrate to the “emerald cities of the advanced world” (p. 373) that offer a more propitious cultural ambiance.
Books, unlike individuals, should be judged in terms of how well they achieve their objectives. As a self-proclaimed exercise in “big history” this work succeeds extraordinarily well: it is engaging and readable, and it renders abstruse economic models and empirical results accessible to nonspecialists. However, big history disdains the requirements of academic research and practical policy regarding tight causal logic, meticulous documentation, and...