How the World Became Rich: The Historical Origins of Economic Growth

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Many of the innovations of the first Industrial Revolution were not science-based and thus did not require a highly skilled workforce. This accessibility fills a gap in the literature by catering to a broader audience, including students, professionals from various fields, and individuals seeking a comprehensive understanding of economic growth. A society’s past and its institutions and culture play a key role in shaping how it may—or may not—develop.

They examine how factors such as natural resources, climate, and geographical location have affected the economic success of different societies throughout history. Key points of comparison include the book’s comprehensive coverage, clarity of explanations, integration of multiple perspectives, use of real-world examples, and recognition of historical context and long-term trends. And if it’s military success that we’re talking about, why didn’t the Dutch invest more in fiscal capacity? In the United Kingdom, whose Industrial Revolution kicked off this transformation, GDP per capita grew about 40 percent between 1700 and 1800. This chapter investigates how cultural factors such as work ethic, attitudes towards innovation and entrepreneurship, and social norms have influenced the economic outcomes of different societies by examining the impact of culture on economic growth.

introduces several ideas explained in detail going into the differences between different nations and how industrial innovations were adopted while comparing the various outcomes. As I alluded to then, I think the international comparative evidence for this theory is lacking—the authors assert that the Dutch had a “relative paucity” of skilled workers, but I’m not completely convinced that this should have been the case. This is effectively a readable textbook…Rubin and Koyama synthesize all this literature and discuss five major ways to explain the Great Divergence: geography, demography, imperialism, culture and institutions. The book's not perfect (I don’t even agree with that much of it), but the main points—pre-Soviet growth was limited and living standards/urbanization did rise under the Five-Year plans—are not really compatible with the more standard view (planning failed and was unsustainable) that the authors espouse. However, the limitations are aspects of what makes the work valuable for those seeking to obtain an entry-level understanding of how wealth is created.

That’s changed: How the World Became Rich, by Chapman University’s Jared Rubin and George Mason University’s Mark Koyama, provides a comprehensive look at what, exactly, changed when sustained economic growth began, what factors help explain its beginning, and which theories do the best job of making sense of the new stage of life that humans have been experiencing for a couple brief centuries. Nevertheless, it is worth noting that advanced scholars or experts in the field may require more specialized or advanced literature to meet their specific requirements. We are treated to a catalog of canonical results wrung from the stones of history, findings that we can use to guide our thinking about broader questions of development. In this vein, I would have liked to see more emphasis on the now-standard critiques of the Glorious Revolution literature, as summarized in Ogilvie and Carus ( 2014 ). They discuss recently-advanced theories rooted in geography, politics, culture, demography, and colonialism.

It presents complex economic concepts clearly and understandably, avoiding excessive technical jargon. Several economists, like Robert Gordon and Thomas Philippon, have worried that the past couple hundred years might be an aberration, and growth might now slow down. Many theories of the revolution give exploitation of New World resources and of enslaved African people a key role in explaining industrialization.