Quotulatiousness

February 1, 2014

Economics can’t explain everything – the “Great Fact”

Filed under: Economics, History — Tags: , , — Nicholas @ 09:02

David Boaz rounds up a few human moments to illustrate the “Great Fact”:

In Bourgeois Dignity: Why Economics Can’t Explain the Modern World, economic historian Deirdre McCloskey writes about the “Great Fact” — the enormous and unprecedented growth in living standards that began in the western world around 1700. She calls it “a factor of sixteen”: we moderns consume at least 16 times the food, clothing, housing, and education that our ancestors did in London in the 18th century.

[…]

And finally, I note an older book on my own Scottish ancestors, The Scotch-Irish: A Social History by James G. Leyburn:

    The squalor and meanness of [lowland Scottish] life around 1600 [or 1700] can hardly be conceived by a person of the twentieth century. A cluster of hovels housed the tenants and their helpers….A home was likely to be little more than a shanty, constructed of stones, banked with turf, without mortar, and with straw, heather, or moss stuffed in the holes to keep out the blasts….The fire, usually in the middle of the house floor, often filled the whole hut with malodorous clouds, since the smoke-clotted roof gradually stopped the vent-hole. Cattle were tethered at night at one end of the room, while the family lay at the other end on heather piled upon the floor….Vermin abounded…skin diseases…Infectious diseases were propagated readily.

According to scholars such as Angus Maddison and Brad DeLong, GDP per capita hardly rose for thousands, or tens of thousands, of years before the emergence of capitalism. And then after 100,000 years of stagnation (by DeLong’s estimates), around 1750 capitalism and growth began, first in Northern Europe and the American seaboard, and spreading ever since to more parts of the world. That is, the existence of relatively free markets is the reason we don’t live like my Scottish ancestors. This is indeed the Great Fact of the modern world. We should celebrate it, even as we work to extend the benefits of markets to people and nations who don’t yet enjoy as much capitalism as they should.

January 3, 2014

Virginia Postrel on “first world problems”

Filed under: Business, Economics, Technology — Tags: , , , — Nicholas @ 15:53

I’ve heard the term many, many times (and used it more than a few times as well), but as Virginia Postrel points out, it didn’t just happen by chance that there are “first world problems” we can mock-sympathize over:

Third world conditions are defined not merely by economic misery but by unreliable services. “At the age of fourteen I had experienced a miracle,” writes Suketu Mehta in Maximum City, his critically acclaimed 2009 book on Mumbai. “I turned on a tap, and clean water came gushing out. This was in the kitchen of my father’s studio apartment in Jackson Heights [New York]. It had never happened to me before. In Bombay, the tap, when it worked, was always the first step of a process” taking at least 24 hours to produce drinkable water. Mehta’s family lived an affluent life but with third world problems.

By contrast, in a developed country, barring a major natural disaster, you can count on uninterrupted electricity, hot and cold running water, sewage disposal, garbage pickup, heat (and in hot climates, air conditioning), telephone service, Internet access and television. The roads and bridges will be in decent repair; the elevators will work; the ATMs will have cash; and you’ll be able to find a decent public toilet when you need one.

These things aren’t necessarily free, but they’re cheap enough for pretty much everyone to enjoy them. Most significantly, they’re ubiquitous and reliable. Even when natural disasters strike, we can expect heroic efforts to get things back to normal. Under normal circumstances, we can depend on these services to be there consistently and to work as promised. We can make plans accordingly. That’s a first world privilege.

[…]

It took years of sustained efforts by online retailers and delivery services to make overnight orders realistic. It also took dissatisfaction: insanely demanding companies working to please insanely demanding customers — or, in some cases, to offer customers services they hadn’t even thought to ask for — as each improvement revealed new sources of discontent.

“Form follows failure,” is what Henry Petroski, the civil engineering professor and prolific popular writer, calls the process. Every step forward begins with a complaint about what already exists. “This principle governs all invention, innovation, and ingenuity; it is what drives all inventors, innovators, and engineers,” he writes. “And there follows a corollary: Since nothing is perfect, and, indeed, since even our ideas of perfection are not static, everything is subject to change over time.”

Rising expectations aren’t a sign of immature “entitlement.” They’re a sign of progress — and the wellspring of future advances. The same ridiculous discontent that says Starbucks ought to offer vegan pumpkin lattes created Starbucks in the first place. Two centuries of refusing to be satisfied produced the long series of innovations that turned hunger from a near-universal human condition into a “third world problem.”

October 30, 2013

Human Progress

Filed under: Economics, Education, Environment, Food, Health, History — Tags: , — Nicholas @ 09:57

At Reason, Marian Tupy introduces a new website celebrating Human Progress:

In a world where we are constantly bombarded with bad news, it can sometimes be difficult to think of “progress” and “humanity” in the same sentence. Are there not wars taking place, people going hungry, children at work, women being abused, and mass poverty around the world?

In fact, for most of human history, life was very difficult for most people. People lacked basic medicines and died relatively young. They had no painkillers and people with ailments spent much of their lives in agonizing pain. Entire families lived in bug-infested dwellings that offered neither comfort nor privacy. They worked in the fields from sunrise to sunset, yet hunger and famines were commonplace. Transportation was primitive and most people never traveled beyond their native villages or nearest towns. Ignorance and illiteracy were rife. The “good old days” were, by and large, very bad for the great majority of humankind.

Average global life expectancy at birth hovered around 30 years from the Upper Paleolithic to 1900. Even in the richest countries, like those of Western Europe, life expectancy at the start of the 20th century rarely exceeded 50 years. Incomes were quite stagnant, too. At the beginning of the Christian era, annual incomes per person around the world ranged from $1,073 to $1,431. As late as 1820, average global income was only $1,274 per person. (Angus Maddison, whose income estimates I use here, gives his data in 1990 dollars. I have adjusted Maddison’s figures for inflation.)

Humanity has made enormous progress — especially over the course of the last two centuries. For example, average life expectancy in the world today is 67.9 years. In 2010, global per capita income stood at $13,037 — over 10 times what it was two centuries ago.

The new website is called Human Progress:

It is perhaps best to start by explaining what the Human Progress website is not trying to accomplish. It will not try to convince you that the world is a perfect place. As long as there are people who go hungry or die from preventable diseases, there will always be room for improvement. To that end, we all have a role to play in helping the destitute in our communities and beyond.

Our goal, then, is not to paint a rosy picture of the state of humanity, but a realistic one. A realistic account of the world should focus on long-term trends, comparing living standards between two or more generations. Crucially, it should compare the imperfect present with a much more imperfect past, rather than with an imagined utopia in the future.

As such, this website has two main aims. First is to inform you about the many ways in which the world has become a better place. Second is to allow you to search for reasons that brought that improvement about. While we think that policies and institutions compatible with freedom and openness are important factors in promoting human progress, we let the evidence speak for itself and hope the website stimulates an intelligent debate on the drivers of human progress.

June 6, 2011

Tyler Cowen discusses “The Great Stagnation”

Filed under: Economics, History, Science, Technology, USA — Tags: , , — Nicholas @ 14:13

December 18, 2009

Why this is the best Christmas ever

Filed under: Economics, Liberty — Tags: , , — Nicholas @ 15:38

September 3, 2009

Was Fukuyama correct after all?

Filed under: China, Economics, History — Tags: , — Nicholas @ 18:28

Scott Sumner has an interesting post up about Francis Fukuyama’s “end of history” thoughts of the late 1980s:

So the obvious choice for most successful prediction is Francis Fukuyama’s 1989 claim that “history was ending,” that the great ideological battle between democratic capitalism and other isms was essentially over, and that henceforth the world would become gradually more democratic, peaceful, and market-oriented.

[. . .]

I get very annoyed when I see people say “the Chinese case proves that economic development doesn’t inevitably lead to political liberalization.” There are so many problems with this sort of statement that one hardly knows were to begin. China has seen incredible political liberalization since 1978, indeed even some progress since 1998. But what about western-style democracy? To answer that question, consider the list above. I would argue that China most resembles Thailand. Both have similar per capita GDPs, both have a huge split between the urban elite and the rural poor. My hunch is that consciously or subconsciously, the urban residents of China are not thrilled by the idea of a pure democracy that would effectively turn the country over to the rural poor. But wait a few decades, when China goes from being 60%-70% rural, to 60%-70% urban, and from mostly poor to mostly middle-income, and from mostly undereducated to mostly educated. Then let’s see how Fukuyama’s thesis holds up.

History is still ending. Or maybe I should say “his story” is ending, the story of war, revolution and voyages of discovery. The Illiad and the Odyssey. And “her story” is beginning. A world focused on improving education, health care, cuisine, leisure time, the arts, communication, animal rights, the environment, etc.

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