Thought du Jour

An unusual feature of Deirdre McCloskey’s book, Bourgeois Dignity, is the chapter headings which provide a concise summary of the argument of the book. Few books have impressed me so much.

The volume contains 450 pages of text, so each chapter is roughly 10 pages long. In addition there are 42 pages of endnotes, 41 pages of references and a useful 37-page index.

You can read the entire first chapter (pp. 1-9) here. Below is the complete table of contents.

1   The Modern World Was an Economic Tide, But Did Not Have Economic Causes.
2   Liberal Ideas Caused the Innovation
3   And a New Rhetoric Protected the Ideas.   
4   Many Other Plausible Stories Don’t Work Very Well.   
5   The Correct Story Praises “Capitalism.”   
6   Modern Growth Was a Factor of at Least Sixteen.    
7   Increasing Scope, Not Pot-of-Pleasure “Happiness,” Is What Mattered,   
8   And the Poor Won.    
9   Creative Destruction Can Be Justified Therefore on Utilitarian Grounds.   
10   British Economists Did Not Recognize the Tide,   
11   But the Figures Tell.   
12   Britain’s (and Europe’s) Lead Was an Episode,    
13   And Followers Could Leap over Stages.    
14   The Tide Didn’t Happen because of Thrift;    
15   Capital Fundamentalism Is Wrong.    
16   A Rise of Greed or of a Protestant Ethic Didn’t Happen;
17   “Endless” Accumulation Does Not Typify the Modern World.   
18   Nor Was the Cause Original Accumulation or a Sin of Expropriation.   
19   Nor Was It Accumulation of Human Capital, Until Lately.    
20   Transport or Other Domestic Reshufflings Didn’t Cause It,   
21   Nor Geography, nor Natural Resources;   
22   Not Even Coal.    
23   Foreign Trade Was Not the Cause, Though World Prices Were a Context,   
24   And the Logic of Trade-as-an-Engine Is Dubious,   
25   And Even the Dynamic Effects of Trade Were Small.    
26   The Effects on Europe of the Slave Trade and British Imperialism Were Smaller Still,
27   And Other Exploitations, External or Internal, Were Equally Profitless to Ordinary Europeans.   
28   It Was Not the Sheer Quickening of Commerce    
29   Nor the Struggle over the Spoils.   
30   Eugenic Materialism Doesn’t Work;
31   Neo-Darwinism Doesn’t Compute;    
32   And Inheritance Fades.
33   Institutions Cannot Be Viewed Merely as Incentive-Providing Constraints,   
34   And So the Better Institutions, Such as Those Alleged for 1689, Don’t Explain,
35   And Anyway the Entire Absence of Property Is Not Relevant to the Place or Period   
36   And the Chronology of Property and Incentives Has Been Mismeasured,    
37   And So the Routine of Max U Doesn’t Work.
38   The Cause Was Not Science,   
39   But Bourgeois Dignity and Liberty Entwined with the Enlightenment.   
40   It Was Not Allocation:   
41   It Was Words.   
42   Dignity and Liberty for Ordinary People, in Short, Were the Greatest Externalities,
43   And the Model Can Be Formalized.   
44   Opposing the Bourgeoisie Hurts the Poor,    
45   And the Bourgeois Era Warrants Therefore Not Political or Environmental Pessimism   
46   But an Amiable, if Guarded, Optimism.   

Deirdre N. McCloskey, Bourgeois Dignity: Why Economics Can’t Explain the Modern World (University of Chicago Press, 2010), pp. vii-ix.

Like imperialism and trade, science was more a result of economic growth than a cause.

All this remains to be shown …. But understand the main point here: even today … a great deal of economic growth in a country has little or nothing to do with science. The spread of economic growth to places like Brazil or Russia or India or China uses some science-based technologies, such as cell phones, but uses also a great many merely technology-based technologies free of much input from science …. And the international spread of growth has intensively used the social “technology” of bourgeois dignity and liberty.

Deirdre N. McCloskey, Bourgeois Dignity: Why Economics Can’t Explain the Modern World (University of Chicago Press, 2010), pp. 360-361.

Surprised? (I was.) Not convinced? Before rejecting McCloskey’s thesis read all ten pages of chapter 38 (“The cause was not science”), pp.355-365 or, better yet, read the entire book.

I am continuing to read Deirdre McCloskey’s delightful book. Each page contains material to think about. Professor McCloskey is not kind to anyone she feels has misinterpreted economic history. Here is a brief example.

True, people thought that mercantilist aggression was good for them. …. It is the rhetoric of business-school deans and big-thinking journalists. But it is not sound, then or now, whatever people believe.

An instructive example of the unsound connection of aggression to economic success is the military historian Correlli Barnett’ brilliant old book of 1972, The Collapse of British Power, an influence for example on the Thatcher administration in Britain. …. [Barnett] mixes rank in the league table of power with economic success, and assumes … that what people thought at the time was an important connection among trade, empire, military might, and domestic prosperity was in fact the case. Thus Barnett:

in the eighteenth century the English ruling classes … saw foreign policy in terms of concrete interest: markets, national resources, colonial real estate, naval bases, profits. …. They saw national power as the essential foundation of national independence; commercial wealth as a means to power; and war as among the means to all three. They accepted it as natural and inevitable that nations should be engaged in a ceaseless struggle for survival, prosperity and predominance.

That’s right. That’s what they thought. But they were wrong–even in the dismal year for the British economy of 1972–to lament British economic “decline.” He attributed the “decline” to softness of mind and softness of will, arising especially from a new evangelical Christianity:

The abolition of the slave trade in 1807 as a result of a campaign led by William Wilberforce and of slavery itself in the British Empire in 1833 were the earliest of the great social achievements of British evangelicalism. …. As a consequence of this spiritual revolution English policy ceased to be founded solely on the expedient and opportunistic pursuit of English interests. ….

Barnett’s analysis sounds quite plausible, and it sounded even more so in the realpolitik days of 1972. Certainly British politics, at home and abroad, became in the nineteenth century more ethically driven, right down to coming to the aid of the French in 1914, against expediency, and then making a welfare state …. /but Britain, despite its lamentable descent into namby-pamby soft-heartedness, to be cured in the glorious war of conquest against the Argentinians, has remained one of the richest economies on earth, and has shared in the modern engine of innovation, which it started.

[…]

Britain’s overseas trade [and colonies], in short, can’t explain Britain’s peculiarity. Lining up national conquest with national trade is an old claim, though Adam Smith and many economists since him have wisely contradicted it (without persuading many politicians or journalists.) National conquest, though, doesn’t explain early British industrialization, and certainly not the continuation on the way to the [growth] factor of sixteen.

Deirdre N. McCloskey, Bourgeois Dignity: Why Economics Can’t Explain the Modern World (University of Chicago Press, 2010), pp. 215-216, 225.

More snippets from McCloskey will follow. I have added a “McCloskey” tag so that you can easily find them.