The Origins of Affluence

Gregory Clark, an economic historian at UC Davis, has a doozy of a theory about the roots of the Industrial Revolution and, by extension, the increasing disparity in the wealth of nations.

Prior to the 19th century, all advances in food production efficiency had been offset by the resultant growth in population, which absorbed the increased capacity. This is the basic idea behind the Malthusian poverty trap.

Dr. Clark's thesis, to be published next month in a book titled "A Farewell to Alms", posits that it was not a change in the institutional settings, as has been traditionally taught, but rather a change in attitudes which set the stage for the Industrial Revolution. Clark sees the spread of what are nowadays considered middle-class values - namely, a strong work ethic, a penchant for saving, literacy, and non-violence - from England's wealthy classes into the lower ranks of society as the principle reason for England's unprecedented wealth accumulation.

The book seems set to cause quite a stir, and I can already see the oncoming tidal wave of academic backlash in the near future. Very Jared Diamond-esque. It does appear to raise some intriguing points, though, as evidenced by the NY Times review:

"Many commentators point to a failure of political and social institutions as the reason that poor countries remain poor. But the proposed medicine of institutional reform “has failed repeatedly to cure the patient,” Dr. Clark writes. He likens the “cult centers” of the World Bank and International Monetary Fund to prescientific physicians who prescribed bloodletting for ailments they did not understand."