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The Fate of Rome: Climate, Disease, and the End of an Empire

Author(s):Harper, Kyle
Reviewer(s):Temin, Peter

Published by EH.Net (April 2018)

Kyle Harper, The Fate of Rome: Climate, Disease, and the End of an Empire. Princeton: Princeton University Press, 2017. xiii + 417 pp. $35 (hardcover), ISBN: 978-0-691-16683-4.

Reviewed for EH.Net by Peter Temin, Department of Economics, MIT.

This is an exciting book that provides a fresh look at a perennial topic, the fall of the Roman Empire, in sparkling prose accessible to all economic historians. Harper, Professor of Classics and Letters and Provost of the University of Oklahoma, has written extensively about the later Roman Empire. In this book, he argues that climate change and pandemics caused the empire to collapse. The book alternates between ancient history and biological analyses, but it is clear and understandable to readers from all disciplines.

In Harper’s words, “The fate of Rome was played out by emperors and barbarians, senators and generals, soldiers and slaves. But it was equally decided by bacteria and viruses, volcanoes and solar cycles” (pp. 4-5). Harper gives space to both of these sets of characters, and he indicates along the way how far we have gotten in understanding the causes of ancient diseases and climate changes. For example, we are quite sure of the bugs involved in some Roman plagues and still in the process of figuring out which bugs were causing other plagues. While convincing to this reader, the book is a progress report in the use of modern biological tools to understand ancient history.

Harper starts his exposition with the early Roman Empire, arguing that both population and real incomes were rising. The cause of this violation of Malthusian rules has been debated in the ancient history literature, and the current thought is that it was due to increased trade as the Romans extended and pacified the shipping lanes around the Mediterranean Sea. Harper reproduces a graph from his article “People, Plagues and Prices from the Roman World: The Evidence from Egypt” (Journal of Economic History, 76 (3), 803-39) containing regression analyses of the trends in Egyptian prices and showing that wages were rising faster than wheat prices in Egypt. Readers of the book should consult the article for details of the regressions, which support the existence of trade throughout the Roman Mediterranean.

This economic integration, Harper argues, gave rise to germ mobility and then plagues as well. The first Roman plague, known as the Antonine Plague, took place in the late second century, after 160. It was caused by an outbreak of what probably was smallpox, and it began the deterioration of the Roman Empire. Inflation began after the plague, and the turnover of emperors became more frequent. I argued in The Roman Market Economy (Princeton, 2013) that these changes were due to the Antonine Plague, and Harper extends this argument.

The second Roman plague, known as the Cyprian Plague, took place about a century later. This plague may have been caused by what is now known as the Ebola Virus from recent outbreaks in Africa. Note that while smallpox is bacterial, plagues also can be caused by viruses. And the Cyprian Plague intensified the inflation and political instability of the Roman Empire.

The third shock to the Roman Empire was caused by climate change rather than a plague. The early Roman Empire was blessed with a stable and warm climate which lasted for several centuries. It began to break down in the late fourth century, and droughts and colder temperatures drove Rome’s neighbors to the northeast to move southward into what had become the Western Roman Empire. In Harper’s words, “These invasions were not mere raids; they were migrations, movements of people, with women and children in train” (p. 194). The Huns overwhelmed the Roman soldiers, but Alaric led his Goths into Italy and conquered Rome in 410. This dramatic event symbolized the decline of Rome and stimulated Augustine to write The City of God.

The third Roman plague, known as the Justinian Plague, and the fourth of Harper’s natural shocks, began in the sixth century and lasted for two centuries in and around the surviving Eastern Empire based in Constantinople. It was caused by a bacterium known as Yersinia pestis, or Y. pestis, and took the form of bubonic plague in most places and times. Given the spread-out population in the East and the paucity of human remains in any one place, historians have struggled to describe the Justinian Plague for a long time. Only recently have our powers of recovery and analysis become accurate enough for Harper and others to describe the causes and the extent of the plague.

Justinian’s reign had an epic cold snap that was global in scale; there were years in the mid-sixth century that had no summer at all. Harper speculates that the cold snap created conditions that tied the bacterium to black rats and their fleas and finally to us — with a few more steps in between. He says that interaction of diseases and plagues is very complex and decidedly non-linear, but he is sure it will be found. The cold snap also was a harbinger of what has been called the Little Ice Age that followed the Justinian Plague and intensified the chaos that followed.

The Justinian Plague devastated the remaining Roman parts of the Empire just as Islam was making its push into Europe. The disorganized and ailing Romans were no match for the invading Muslims. The Justinian Plague, in other words, not only caused the Eastern Roman Empire to collapse; it also increased the scope of Islam in and around Europe that lasted for many centuries.

I have emphasized the innovative parts of Harper’s work in this review, but ancient historians will find lots of descriptions of ancient events mixed in with the biological analyses. Others interested in plagues will find time lines and stories to ground the biology in its Roman context. And anyone who is attempting to use the fall of the Roman Empire as an example in contemporary life should read this book before expounding one or another outmoded theory of the fall of the Roman Empire.
Peter Temin is Professor Emeritus of Economics at MIT and author of, most recently, The Vanishing Middle Class: Prejudice and Power in a Dual Economy (MIT Press, 2017).


Copyright (c) 2018 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (April 2018). All EH.Net reviews are archived at

Subject(s):Economywide Country Studies and Comparative History
Historical Demography, including Migration
Geographic Area(s):Europe
Middle East
Time Period(s):Ancient

Famine in European History

Editor(s):Alfani, Guido
Ó Gráda, Cormac
Reviewer(s):Naumenko, Natalya

Published by EH.Net (January 2018)

Guido Alfani and Cormac Ó Gráda, editors, Famine in European History. New York: Cambridge University Press, 2017. xi + 325 pp. $30 (paperback), ISBN: 978-1-316-63183-6.

Reviewed for EH.Net by Natalya Naumenko, Department of Economics, Northwestern University.

This collection of essays undertakes to construct a comprehensive history of famine in Europe. Each of the authors is an expert on the history of famine in a particular country or group of countries. In the opening chapter, the editors introduce methodology and discuss the common factors that created famine conditions and their relative importance in the European context. The concluding chapter studies famines during World Wars I and II.

Throughout the book, a standard definition of famine is used: “Famine refers to a shortage of food or purchasing power that leads directly to excess mortality from starvation or hunger-induced disease” (p. 2). Famines occur when food is scarce. Scarcity, in turn, occurs when either food production or distribution is impaired (or both). Weather, crop diseases, changes in technology and climate all affect production. Market integration and specific public institutions providing relief affect distribution. Population pressure can increase the probability of famine (the number of famine episodes notably decreased after the Black Death epidemics). Finally, war is another important factor affecting both production (by destroying crops and reducing available labor) and distribution (via extortions and disruption of trade). The relative importance of production versus distribution changed over time — while some medieval famines can probably be attributed mostly to a shortage of the total amount of available food due to adverse shocks to production, with improvement in technology and market integration the factors affecting the distribution started playing a major role.

The country-specific chapters have a similar structure. Each chapter reports a time series of famines using best available data (relying on chronicles for earlier events, time series of burials and foodstuff prices for later events) usually from the thirteenth century and up to nineteenth century, although for some countries the time series of famines start as early as seventh century. Each chapter then attempts to analyze the scope and the severity of the famines, highlights some of the most important ones, and discusses the factors that led to the famines.

Although the reasons leading to famine are similar for all countries and are summarized in the introduction, some interesting country-specific factors are worth highlighting. For Italy the authors name population pressure combined with crop failure due to the weather or war as the main reasons leading to famine. Introduction of new crops (especially maize) during the eighteenth century finally increased food security but led to spread of pellagra disease. In Spain in addition to all the factors mentioned earlier epidemics could lead to famine by decreasing labor and consequently harvest. The famine research in France has been so extensive that it is difficult to distinguish between true crises affecting large areas and a high share of population and relatively localized ones. The increase in fiscal dues and the growth of cities to some extent offset the improvement in agricultural technology and therefore increased the probability of famines. In Germany, Switzerland, and Austria the lack of centralization increased the probability of famines — in case of local dearth, neighboring lords could shut grain trade exacerbating local food shortages.

The northern Low Countries, escaped from famine as early as late sixteenth century (with the exception is the crisis of 1845-1850 caused by potato blight) due to the central position of Amsterdam in the European grain trade. Episodes of famine in the southern Low Countries are mostly linked to war. Similarly, England escaped famine as early as eighteenth century due to change in weather conditions, improvements in food production technology, market integration, and, most importantly, the presence of well-developed relief system. In Ireland, chronicles document severe famines as early as seventh century. The two most notable recent crises are the famines of 1740-1741 and the famine of the 1840s. Both were triggered by severe external shocks — extremely cold weather and potato blight respectively. The 1840s crisis is outstanding both in its scale and its long-term impact on the population as it triggered mass emigration. Finally, despite the fact that the Nordic countries (Denmark, Sweden, Finland, Norway, and Iceland) are located in areas that are less suitable for agriculture and therefore more prone to crop failures due to poor weather, widespread famine was a rare occurrence there due to diversified agriculture and well-integrated markets.

In Eastern Europe (Russia and the Soviet Union) little quantitative information is available before the eighteenth century (characteristically, in the Russian language there is no distinction between dearth and famine), although some notable famines of sixteenth and seventeenth centuries are discussed. Most importantly, the nature of food difficulties was determined by specific geographic conditions: for strategic reasons the capital and major industrial centers were located in the grain-deficit North and food had to be extracted from grain surplus regions of the South. Thus, when markets disintegrated due to the war, the grain-deficit North suffered (as in 1918-1920), and when negative weather shock occurred, mortality increased where grain was produced (as in 1921-1922). According to Stephen Wheatcroft, the famine of 1927-1933 was triggered by severe drought, and 1941-1947 food shortages and famine were caused by the occupation of grain producing regions by the Germans, and by poor weather of 1946. Nevertheless, it remains an open question why unfavorable weather caused severe famines in the Soviet Union while in other European countries weather ceased to play a major role by the beginning of twentieth century.

The final chapter discusses the episodes of famines related to World War I and World War II. The unprecedented scale of these conflicts disrupted food production and distribution, negatively affecting both traditionally grain exporting and grain importing territories. In addition, famine relief efforts were hindered by the conflict, the population in the occupied territories suffered from over-extraction of foodstuffs, and many prisoner camps were inadequately supplied. These factors explain pockets of starvation occurring even in areas that had long been free of famine.

This book does not oversell, does not strike the reader with bold concepts, unorthodox perspectives, or loud slogans. It does exactly what it promises — delivers a comprehensive systematic history of famine based on rigorous data collection and careful analysis. The analysis in the introductory chapter provides an excellent summary of the complex phenomena that famines are and will take its deserved place in many economic history courses. And although famine is [hopefully] long gone in Europe, all factors discussed in the book are still relevant for less developed parts of the world.

Natalya Naumenko is completing her dissertation on famines in the Soviet Union at Northwestern University.

Copyright (c) 2018 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (January 2018). All EH.Net reviews are archived at

Subject(s):Historical Demography, including Migration
Military and War
Household, Family and Consumer History
Living Standards, Anthropometric History, Economic Anthropology
Geographic Area(s):Europe
Time Period(s):Medieval
16th Century
17th Century
18th Century
19th Century
20th Century: Pre WWII

Energy and Civilization: A History

Author(s):Smil, Vaclav
Reviewer(s):Jones, Eric

Published by EH.Net (August 2017)

Vaclav Smil, Energy and Civilization: A History. Cambridge, MA: MIT Press, 2017. x + 552 pp. $40 (cloth), ISBN: 978-0-262-03577-4.

Reviewed for EH.Net by Eric Jones, La Trobe University.
The arrival of an encyclopedic tome of 550 pages, crammed with graphs, calculations, bar diagrams and the interruption of plentiful “boxes,” so giving every appearance of being a textbook, does not usually fill the breast of a reviewer with joy. Fortunately reading this volume turns out to be a pleasure. Vaclav Smil came to notice in 1984 with The Bad Earth, an early account of China’s environmental degradation, and has since written prolifically on topics concerning energy. He is described as an “incorrigible inter-disciplinarian,” a stance that helps him compare and calibrate sources over the widest possible range. His latest book is a greatly expanded version of an earlier volume and may be taken as a summary of his life’s work. It is immensely valuable for reference as well as for calm, decisive commentaries on the state of knowledge, besides on what is actually or potentially computable about uses of energy worldwide and throughout the very long term.

What Smil concludes about the early modern period provides some of the most insightful passages among a vast number of offerings. The immense stretches of time when most humans remained either hunter-gatherers or toiling peasants can, of course, be approached along an energy perspective. Interpretations of these tedious periods by many authors nevertheless tend to lean on mere assumptions about motive and on various anthropological analogies that are sometimes plausible but commonly arbitrary. They typically amount to pronouncements about indifference to accumulation (readily but unconvincingly supported by material poverty) and chronic aversion to physical labor. Nor is Smil impressed by assertions about the labor supposedly required to erect the great monuments of the past, such as the Great Pyramid, and demonstrates how exaggerated they often are. Better documented detail is available once 1850 is passed, when the Western world took up fossil fuels on a grand scale and soon became a fossil fuel civilization. From that date he pays even closer attention to the energy implications of inventions in sphere after sphere after sphere. He offers a new and informative slant on many of these developments. In principle all this is, however, familiar ground.

Smil’s work on early modern times accordingly stands out between these epochs. What one might call the early modern prologue was remarkably progressive compared with many previous centuries. Smil shows just how much human labor could produce with no more than sweat, levers, treadmills, animals, wind power and water power, and how gradual advances were being made in the diffusion and productivity of these every day methods. His “box” on the raising of Alexander’s column at St Petersburg in 1832 is especially impressive, notwithstanding the facts that foreign architects were employed and that the Monument to the Great Fire of London constructed in the 1670s is taller still. Far earlier than any of this the Romans had made strides in exploiting the power afforded by people and nature. Yet from our distant viewpoint the most interesting fact may be how gradually best practice had spread. The tapping of ostensibly straightforward sources of energy continued for a long time — very long. Water wheels, Smil says, were the most significant energy foundation of Western industrialization. Even allowing for the telescoping effect of hindsight, the ancient world had experienced phases of rapid advance that were not matched for a considerable spell. The later Western world, taken as a whole, was often slow by contrast but at least its gains tended to be cumulative. Permissible loads drawn by French horses in the mid-nineteenth century were about four times the Roman limit. But can we say that reaching this point had been achieved at a reasonable pace?

Agreed, pace depends to some extent on where one stands. Even in the modern period, best practice could diffuse with what to our eyes seems a marked sluggishness. From 1745 the English introduced a fantail to turn the sails of windmills automatically into the wind. Their neighbors, the Dutch, who owned the most windmills in Europe, did not take up this device until the early nineteenth century. For all such blemishes on attainable advance, and despite most labor in England and Wales remaining craft work in 1850, energy output had nevertheless risen fifteen-fold in two hundred years. Was that fast or slow? Either way it meant that industrialization as conventionally defined piggybacked on economic changes already springing up with some frequency. Studies of energy use show that the period leading to modernity was complete by the mid-nineteenth century and by any reasonable measure things changed rapidly thereafter.

Studies of individual subjects might perhaps be thought somewhat like single-issue politics, with the distortions it entails. However Smil explicitly avoids the trap of explaining world economic history in terms of energy alone. Although per capita GDP and energy supply are linked more closely than many elements in socio-economic life, they can be decoupled and a determining role for energy is repeatedly frustrated by political and other choices. Energy use is after all an input, though doubtless one with beneficial outputs, but distributional considerations often alter the expected results. The population response that development economists once thought likely to neutralize any income gained from slow technical advances may have been deflected because elites commandeered a lion’s share of the gains. Smil insists on the need to get the balance right between energy imperatives and a multitude of non-energy factors. He rejects tempting comparisons across sectors, such as the uncannily similar energy use by sailing ships and drainage windmills during the United Provinces’ Golden Age, pointing out that no volume of peat dug would have made possible the voyages to the East Indies. Certainly there were too many overlaps in types of exploitation at any one period to separate history into energy eras. There is long experience and a maturity of judgment in this book that inspire much confidence.

Eric Jones, Emeritus Professor, La Trobe University, and former Professorial Fellow, Melbourne Business School, is the author of Locating the Industrial Revolution: Inducement and Response (World Scientific, 2010), The Fabric of Society and How It Creates Wealth (Arley Hall Press, 2013) [with Charles Foster], Cultures Merging: A Historical and Economic Critique of Culture (Princeton, 2016, paperback) and Middle Ridgeway and its Environment (Wessex Books, 2016) [with Patrick Dillon].

Copyright (c) 2017 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (August 2017). All EH.Net reviews are archived at

Subject(s):History of Technology, including Technological Change
Transport and Distribution, Energy, and Other Services
Geographic Area(s):General, International, or Comparative
Time Period(s):General or Comparative

Capital Gains: Business and Politics in Twentieth-Century America

Editor(s):John, Richard R.
Phillips-Fein, Kim
Reviewer(s):Benson, Erik

Published by EH.Net (July 2017)

Richard R. John and Kim Phillips-Fein, editors, Capital Gains: Business and Politics in Twentieth-Century America. Philadelphia: University of Pennsylvania Press, 2017. x + 301 pp. $55 (hardcover), ISBN: 978-0-8122-4882-1.

Reviewed for EH.Net by Erik Benson, Humanities Division, Cornerstone University.

In this volume, Richard John of Columbia University and Kim Phillips-Fein of New York University compile eleven essays on the relationship between business and government in twentieth-century America. Contrary to popular perception, this relationship has not been exclusively adversarial, nor have business elites been exclusively committed to “free market fundamentalism” (p. 19). Their interests, views, and activities have varied significantly, and thus their involvement in politics has been complex.

In their introductory overview, the editors argue that in light of the importance of the political economy to the country, a renewed focus on and better understanding of its history is vitally necessary. They acknowledge the contributions of Progressive and corporate liberal scholars, but assert that the role of business elites in the policymaking process has suffered from neglect. Fortunately, a new generation of scholars is emerging who draw upon economic, political, and social perspectives to render a more complex portrayal of America’s political economy. Much as others have done with groups such as the working class, these scholars are presenting the business elite as real actors with complex and varied motives, approaches, and outcomes. At the same time, as a group, the business elite has been distinct in successfully influencing policymaking, at the municipal as well as national level. Acknowledging that the essays do not support overarching generalizations, the editors do note some common themes and insights. One is that the relationship between business and government has been “protean” — at times adversarial, at times not (pp. 19-20). Furthermore, when one considers local versus national perspectives, and the varied motives and interests of the different actors, the relationship becomes even more complex. Finally, sound scholarship based on archival research is necessary for a better understanding of the American political economy.

The volume has four parts. The first, covering the Progressive era through the 1920s, contains two essays. The first essay, by Laura Phillips Sawyer, reveals how business interests, worried by the unpredictability of court rulings in antitrust cases, successfully addressed this by establishing the U.S. Chamber of Commerce (USCC) in the 1910s. The USCC facilitated a working relationship with key federal officials and agencies that resulted in predictable economic policies. In the second essay, Daniel Amsterdam shows how business elites in Detroit and Atlanta successfully lobbied for dramatic increases in municipal spending, infrastructure, and regulation. Motivated by a mix of economic interest and reform impulse, these elites were quite willing to wield municipal power to establish a “civic welfare state,” even as they opposed a national welfare state (p. 45).

The second part, covering the New Deal and World War II, has three essays. In the first, Eric S. Hintz chronicles how the National Association of Manufacturers (NAM) blunted a New Deal initiative to reform the patent process. The NAM did so with a sophisticated public relations campaign that celebrated past inventions as pioneering achievements under the existing patent system, thereby portraying most reform as unnecessary. The second essay, by Mark R. Wilson, contemplates the “privatization” of American military procurement. Contrary to most accounts, the evolution of the “military-industrial complex” did not follow a linear trajectory. During the Progressive era, the military developed “in-house” production facilities for war material (p. 80-81). Yet it subsequently reversed course, relying once again on private contractors; this corresponded to the anti-statist turn of the post-World War II period. The third essay, by Richard John and Jason Scott Smith, highlights the work of Thomas McCraw, a leading scholar in the history of America’s political economy. Over a long and prolific career, McCraw “helped lay the foundations” for the now-burgeoning “history of capitalism” (p. 116).

The third part contains three essays that focus on business and economic development. The first, by Tami J. Friedman, uncovers a significant division in business ranks over federal involvement in the post-World War II economy. Decades before the Reagan administration, national business organizations (e.g. the USCC) were articulating an ideology of “free enterprise” and criticizing federal largesse. Yet some local and regional business interests, notably in the Northeast where industries were already failing, welcomed federal aid. The second essay, by Brent Cebul, presents an analogous story set in postwar rural Georgia. Here, business leaders formed local and regional associations to pursue federal funding for development projects. This represented a continuation of the “supply-side liberalism” of the New Deal (p. 143). The third essay, by Elizabeth Tandy Shermer, examines the efforts of business leaders in southern and western states to tailor higher education systems to their interests. This involved complex dealings with political and educational leaders, and while the systems expanded greatly, tensions over the purpose of higher education persisted.

The three essays in part four address business and liberalism. The first, by Jennifer Delton, exposes an internecine struggle between “conservatives” and “liberals” in the NAM during the 1950s and ‘60s. Liberals argued that business needed to balance profitability with “social responsibility,” which conservatives roundly condemned (p. 182). For a brief time, the liberal viewpoint held sway in the historically conservative NAM. In the second essay, Eric R. Smith chronicles the campaign of “Business Executives Move for Peace” (BEM) against U.S. military involvement in Vietnam. BEM played a unique role in the antiwar movement, employing economic arguments and distinct tactics. In the final essay, Pamela Walker Laird shows how business responded to the mandate for workplace equality in the wake of the Civil Rights Act of 1964. Initially, businesses complied to protect their interests, but as time went on, they came to champion diversity as a corporate value, going beyond the governmental mandate.

As a collection of essays focused on select topics, this is not a comprehensive account of the relationship between business and politics in twentieth-century America, nor does it purport to be. Rather, its purpose is to challenge the conventional wisdom about the American political economy by highlighting oft-overlooked complexities. In whole, the essays do this. They evidence extensive research, especially in primary sources, and their arguments are generally well presented. For their part, the editors provide a very useful framework for the essays. The work certainly contains points that are up for debate, yet these do not detract from its value; in fact, they represent opportunities for future scholarly engagement. In addition to scholars, undergraduate courses in business history could benefit from this work, as the essays are quite accessible and ideal for class discussion. In all, this is a fine scholarly contribution.

Erik Benson is the author of Aviator of Fortune: Lowell Yerex and the Anglo-American Commercial Rivalry, 1931-46 (2006), a study of a pioneering airline entrepreneur. He is continuing research in the history of flight, and serves on the editorial staff of Essays in Economic and Business History.

Copyright (c) 2017 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (July 2017). All EH.Net reviews are archived at

Subject(s):Business History
Government, Law and Regulation, Public Finance
Geographic Area(s):North America
Time Period(s):20th Century: Pre WWII
20th Century: WWII and post-WWII

The Long Space Age: The Economic Origins of Space Exploration from Colonial America to the Cold War

Author(s):MacDonald, Alexander
Reviewer(s):Salter, Alexander

Published by EH.Net (June 2017)

Alexander MacDonald, The Long Space Age: The Economic Origins of Space Exploration from Colonial America to the Cold War.  New Haven: Yale University Press, 2017. xi + 258 pp. $35 (hardcover), ISBN: 978-0-300-21932-6.

Reviewed for EH.Net by Alexander Salter, Rawls College of Business, Texas Tech University.

Alexander MacDonald, an economic historian trained at Oxford currently working as an economist for the Jet Propulsion Laboratory and as Senior Economic Advisor with NASA, has written an exciting account of the development of space capability in the United States.  MacDonald’s scholarship is both readable and precise, and this thesis — that private initiative in space has historically been much greater than recognized — certainly challenges conventional interpretations in the literature on the economics of space policy.

In the Introduction, MacDonald makes clear he is undertaking an ambitious project.  The conventional wisdom holds that space exploration was primarily driven by governments, and in particular by competition between the United States and the Soviet Union during the Cold War.  The U.S.’s victory with the Apollo 11 landing, and eventual triumph with the waning and collapse of the Soviet Union, saw public activity in space shrink during the latter decades of the twentieth century, with private activity (privately funded commercial and exploratory ventures) just picking up in the first decades of the twenty-first.  MacDonald seeks to turn this narrative on its head.  Instead of government being the senior partner in space exploration and private initiative the junior, MacDonald shows how “if we look at the history of America space exploration on a longer timescale, a very different history emerges — one in which personal initiative and private funding is the dominant trend and government funding a recent one” (p. 3).  This justifies the author’s chosen title: the Space Age is “Long” because it cannot be fully understood without reference to private initiative in funding observatories, the major space exploration technology to precede spacecraft, dating back to the late eighteenth century.

MacDonald begins by surveying the history of celestial observation in America, from colonial days until the mid-nineteenth century.  He does an excellent job of detailing the rise of civic (community-funded) observatories, as well as the subtle shifts in public motives behind celestial exploration.  Most surprising, however, is the statistical information presented in the beginning of the chapter (pp. 15-19).  By adjusting the expenditures on observatories to capture changes in purchasing power (using an index more relevant to large capital outlays, rather than consumer expenditures), and then showing what the equivalent expenditure today would have to be in order for observatory expenditures to remain a constant share of GDP, MacDonald shows that private initiative was capable of mobilizing vast resources.  For example, expenditures on the Lick Observatory, finished in 1876, totaled $188 million in adjusted dollars.  The equivalent expenditure in 2015, as a percentage of GDP, would be over $1.5 billion, making this expenditure larger than many major NASA missions (pp. 14-16).  Altogether, MacDonald shows that expenditure on space-related observational activities from 1820 to 1940 was overwhelmingly private: 96.6% of funds were supplied by the private sector.  The picture that emerges from these statistics, and the narrative to follow, portrays the dominance of private (individual and community-led) initiative in celestial observation.

The second chapter continues the narrative of the development of American observatories, going up until the 1940’s.  One theme of this chapter is the changing means by which observatories were financed, beginning with community-based, and widely-purchased, subscription options, and later moving predominantly to large grants from wealthy philanthropists.  Others include the tensions between community members and professional astronomers in how observatories were used, and the public motives of politicians, astronomers, and the ordinary public in seeing these projects to fruition.

Chapter 3 focuses on the fundraising strategies of aerospace and rocketing pioneer Robert Goddard.  This is the narrowest of the chapters in terms of focus, and perhaps the one least easy to square with MacDonald’s thesis of private initiative in space exploration.  This is because a good deal of Goddard’s funding came from military contracts during and after the First World War.  However, it’s important to note — as MacDonald does — that most funding for Goddard’s projects did come from private sources, most notably the personal fortune of mining magnate Daniel Guggenheim, and later the Guggenheim Foundation (p. 155).

The final chapter brings us to the popular conception of the Space Age: 1957 (Sputnik) and beyond.  MacDonald analyzes national space programs, focusing on that of the United States, as driven by signaling, rather than national prestige per se (pp. 161-163).  MacDonald presents a simple model of two nations competing for allies.  Potential allies want to ally with the stronger of the two nations, but this information is incomplete and asymmetrically distributed.  The two courter nations can signal power by investing in a successful space program.  A successful space program is a good signal because, as the saying goes, such a program is “costly to make and costly to fake.”  MacDonald also analyzes late- and post-Cold War space activities in terms of signaling, although for obvious reasons the precise information to be signaled, and the goals for signaling in the first place, differed from the periods of fiercest competition with the U.S.S.R.

The Conclusion summarizes the arguments and reasserts MacDonald’s chief contribution: showing that private initiative was massively more important, relative to politically-led signaling efforts during the Space Race, to developing space capability than previously thought.  MacDonald also comments on the implications of his arguments for twenty-first century space policy.  Examples include resisting the temptation to rebuild existing organizations, such as NASA, on lines identical to those that existed in these organizations’ heyday, and instead embrace organizational novelty in the development of space capability, as well as recognizing that the private sector can play a much larger role than previously appreciated.

Overall, MacDonald succeeds in his arguments.  He convincingly shows that early astronomical observation was not a separate phenomenon from the later Space Age, but a necessary precursor that should be seen as contiguous with it.  I have only two quibbles with the book.  The first has to do with the discontinuity, for lack of a better word, between the first two chapters and the remaining chapters.  Chapters one and two form a single coherent narrative, whereas the transition to Goddard’s work and the Space Race can sometimes feel like add-ons.  However, this is probably an unavoidable result of a work that has the courage to be eclectic and wide-ranging in scope, and it does not distract from the thesis.  The second quibble has to do with MacDonald’s analysis of signaling and intrinsic motivation, especially in chapter four.  MacDonald introduces these concepts in the Introduction, seemingly indicating that they will be doing substantial work throughout.  But the heaviest lifting has to wait until his analysis of the Space Race.  I agree with MacDonald that these economic tools can shed vital light on the episodes in question; I only wish they had been as extensively applied in chapters one through three as in chapter four.

In conclusion, I strongly recommend MacDonald’s work to any scholars who are interested in issues at the intersection of political economy, economic history, and space issues.  In conjunction with the literature on the feasibility of private legal orders in space (e.g., Buxton 2004; Coffey 2009; Cooper 2003; Hertzfeld and von der Dunk 2005; Hudgins 2002; Salter, 2016, 2017; Salter and Leeson 2014; Simberg 2012a, 2012b; White 2003), MacDonald’s work can and should be used to make the case that private initiative will continue to be an invaluable component of space policy and engagement in the twenty-first century.


Buxton, Carol R.  2004.  Property in Outer Space: The Common Heritage of Mankind Principle vs. the First in Time, First in Right, Rule of Property. Journal of Air Law and Commerce 69: 689-708.

Coffey, Sarah. 2009. Establishing a Legal Framework for Property Rights to Natural Resources in Outer Space. Case Western Reserve Journal of International Law 41(1): 119-147.

Cooper, Lawrence A. 2003. Encouraging Space Exploration through a New Application of Space Property Rights. Space Policy 19(2): 111-118.

Hertzfeld, Henry R., and Frans G. von der Dunk.  2005.  Bringing Space Law into the Commercial World: Property Rights without Sovereignty. Chicago Journal of  International Law 6: 81-100.

Hudgins, Edward L., eds.  2002.  Space: The Free Market Frontier.  Washington, D.C.: Cato Institute.

Salter, Alexander W.  2016.  Space Debris: A Law and Economics Analysis of the Orbital Commons. Stanford Technology Law Review 19(2): 221-238.

Salter, Alexander W.  2017.  Ordering the Cosmos: Private Law and Celestial Property Rights.  Journal of Air Law and Commerce, forthcoming.

Salter, Alexander W. and Leeson, Peter T. 2014. Celestial Anarchy: A Threat to Outer Space Commerce? Cato Journal 34(3): 581-596.

Simberg, Rand. 2012a. Homesteading the Final Frontier: A Practical Proposal for Securing Property Rights in Space. Competitive Enterprise Institute, Issue Analysis No. 3.

Simberg, Rand.  2012b. Property Rights in Space. The New Atlantis: 20-31.

White, W. N. Jr. 2003.  Interpreting Article II of the Outer Space Treaty.  Paper presented at the 54th International Astronautical Conference.

Copyright (c) 2017 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (June 2017). All EH.Net reviews are archived at

Subject(s):History of Technology, including Technological Change
Geographic Area(s):North America
Time Period(s):18th Century
19th Century
20th Century: Pre WWII
20th Century: WWII and post-WWII

Ethical Capitalism: Shibusawa Eiichi and Business Leadership in Global Perspective

Editor(s):Fridenson, Patrick
Takeo, Kikkawa
Reviewer(s):Mosk, Carl

Published by EH.Net (June 2017)

Patrick Fridenson and Kikkawa Takeo, editors, Ethical Capitalism: Shibusawa Eiichi and Business Leadership in Global Perspective. Toronto: University of Toronto Press, 2017. xvi + 215 pp. $55 (cloth), ISBN: 978-1-4875-0106-8.

Reviewed for EH.Net by Carl Mosk, Department of Economics, University of Victoria.

Virtue is its own reward; bad money drives out good; you catch more flies with honey than vinegar; do unto others as they would have them do unto you; catch two birds with one stone: pithy Western aphorisms to be sure. Still in Meiji Japan, enamored with all things Western, these may well have been translated into Japanese. For sure “two birds, one stone” was.

Why not imbibe Western aphorisms? Meiji period thinkers, politicians, business leaders, movers and shakers of all stripes — perhaps more than during any other period in Japanese history — struggled with identity. Were they firebrands committed to root and branch reform of Japan carving out channels through which Western concepts, Western manufacturing techniques, Western scientific learning, Western institutions, and Western laws could flow into the body politic, finding ingenious ways to cloth this program in traditional neo-Confucian garb? Or were they staunch traditionalists, committed to reviving government by Emperor, reinvigorating a failed military campaign to bring Korea, perhaps even China, to its knees, a daring assault plan inspired by the last of the great sixteenth-century warring overlords, Toyotomi Hideyoshi?

Cobbling together a coalition of elites wholeheartedly signing onto one or both of the two agendas — imperial aggrandizement or wealth creation — proved to be challenging. Still, as it turned out — at least for a half century – it proved eminently feasible. Defeating China in the mid-1890s and Russia in 1905-6 opened the door to Japan’s renegotiation of the unequal treaties granting Western powers extraterritorial rights in treaty ports and it allowed Japan to join the gold standard system. All of this served the interests of business, facilitating the import and export of goods and the promotion of Pacific Ocean based shipping services. At the same time it pleased the military elite intent on carving out an empire in mainland Asia. The ideology cementing this unlikely coalition was known as fukoku kyohei (wealthy country/strong army). During the Meiji period the glue of mutual advantage created a “big tent” under which business and ambitious nationalistic politicians could and did jointly flourish.

Great people are great partly because their personal drive dovetails nicely with the era during which they strut upon the stage of history. Ideally suited to operate under the fukoku kyohei ideological umbrella, Shibusawa Eiichi emerged as a paramount figure in Meiji Japan. Born into a wealthy peasant family during the dwindling twilight of Tokugawa rule rudely opened up to the West by the United States, Shibusawa began his colorful career as an anti-foreigner, pro-Emperor rule firebrand. Active in the events leading to the destruction of Tokugawa feudalism and restoration of the Emperor, Shibusawa abandoned his anti-Western agenda, bursting out onto the stage of Meiji Restoration drama as national bureaucrat who had tasted Western culture firsthand through visits to Europe, especially France.  Joining his illustrious colleague Fukuzawa Yukichi (founder of Keio University), he was assiduous in promoting the education of native elites thirsting for Western knowledge.

As Shibusawa saw it, the supercilious bureaucrats he hobnobbed with in Tokyo were more likely to serve a strong army agenda, willing to jettison a wealthy nation program in flexing Japan’s nascent military muscle in the Far East. Fueled by this belief, he resigned from government service at the Ministry of Finance, plunging into the hustle-and-bustle world of private business as banker and creator of joint-stock companies extraordinaire. He conceived of a program of joint-stock creation known as gapponshugi (a gappon-kaisha is a joint-stock company). In many ways it was the perfect embodiment of fukoku thought, of fukoku practical action. As Shibusawa conceived of gapponshugi, commoners were encouraged to purchase stock in businesses, openly and transparently participating in stockholders meetings, their names prominently displayed for public view. In a nutshell it was economic democracy.

Shibusawa’s gapponshugi model was the diametric opposite of the zaibatsu model associated with closed family-centered conglomerates like Mitsui, Mitsubishi and Sumitomo. To be sure separation of management from ownership was a prominent feature of zaibatsu businesses: they were managed by head clerks promoted from within the ranks of employees, not family members. However the zaibatsu were reluctant to issue stock; they coveted secrets about ownership; as often as not in acquiring assets they exploited elite connections with imperial bureaucrats and powerful politicians. The contrast between open gapponshugi and closed zaibatsu is highlighted in Chapter 1 of the edited volume under review here. Penned by Shimada Masakazu the chapter emphasizes the fact that Shibusawa was the most prominent of a number of Meiji business leaders, the so-called zaikaijin. His duties as a zaikaijin included finding astute managers, putting together boards of directors, serving as temporary president of fledgling firms if needed, and arranging stockholder meetings. As well he acted as investment banker, exploiting his knowledge of dealings on the stock market, even in some cases taking out personal loans to get new businesses afloat.

Testimony to the remarkable ability of Shibusawa — operating from his perch atop the powerful First National Bank, Dai-Ichi (Dai-Ichi Kokuritsu Ginko) — is his role in starting and/or promoting hundreds of joint-stock companies, serving on the boards of directors as chairman in many cases. The diversity of chairmanships is remarkable. Consider the range of enterprises running from infrastructure to standard commerce: Sapporo Beer, Tokyo Gas, Tokyo Rope, the Imperial Hotel, Oji Paper, Tokyo Ishikawajima Shipbuilding, Tokyo Artificial Fertilizer, Iwaki Coal Mining, and Hiroshima Hydro Electricity. The list goes on and on.

Why was Shibusawa so successful in these manifold business dealings? In Chapter 4, Miyamoto Matao provides a tantalizing hypothesis: in terms of paid-up capital, joint-stock capital formation outstripped all other forms of private capital formation during the period 1896-1939 (as a percentage of paid-up capital joint-stock capital always exceeded eighty percent). In an era when business information was unusually costly — because auditing of corporate books was in its infancy and many persons where only marginally literate in finance — highly respected zaikaijin like Shibusawa were instrumental in putting together companies. Their reputations as astute financiers loomed large. The best example of this is Osaka Spinning Company established in 1882. As the “kitchen of the bakufu (shogun)” Osaka had been the merchant capital of Tokugawa Japan. But the Osaka merchants were too conservative — bereft of imagination and knowledge of foreign techniques — to start a steam-driven, Western-style mill in their own backyard. Enter Shibusawa who had toured textile mills in Europe. Not only did he — an outsider — put together financing from warring wealthy Osaka families, he also recruited Yamanobe Takeo who was mastering spinning technologies in Lancashire.

Operating under fukoku kyohei meant operating under constraints. For instance, in defeating China Japan gained the right to operate in Chinese treaty ports on an equal footing with Western powers — rights that included investing directly in Chinese treaty ports. As a result Japanese cotton textiles and Japanese silk reeling companies began to cut into the businesses run by Western merchants, especially the British. Not surprisingly the British reacted negatively. In Chapter 5 Janet Hunter highlights criticism of Japanese business practices in Great Britain. The British press labeled the Japanese liars, cheats, and devious in their ways. For Japanese zaikaijin, like Shibusawa, the message was clear. Diplomacy was needed on the international front; on the domestic front cajoling Japanese merchants into adopting morally acceptable norms was imperative.

Along similar lines, in Chapter 6, Kimura Masato shows that Shibusawa’s diplomatic touch was particularly crucial during the period when extraterritoriality was alive and well in Japanese treaty ports. He points out that some of the criticisms directed at the Japanese were ill founded: it was poorly-informed Western traders operating in Japanese treaty ports who were at fault. Shibusawa stepped in, helping finance through the offices of Dai-Ichi Bank a consortium of Yokohama silk merchants involved in exporting silk, thereby undercutting the Western merchants. Fortunately abrogating the unequal treaties solved this problem. Still it did not dispel Western critiques. Kimura goes on to discuss the accusations directed at Japanese companies by the American business community during the early twentieth century: just as in the 1970s and 1980s the Americans were incensed that the bilateral trade balance between the two countries was favorable to Japan. Shibusawa, realizing the American market was crucial to Japanese exporters, led a delegation to the United States with the aim of encouraging Japanese importers to increase their American sourcing of raw materials and finished products.

That Shibusawa was under international pressure to act as a model zaikaijin in upgrading the standards of Japanese merchant activity goes without saying. That he coupled the commoner/transparency model of gapponshugi with a moral imperative calling for virtuous community-oriented ethics is another matter altogether. There is little doubt that Shibusawa was a sincere believer in the neo-Confucianism he imbibed in his youth. Shibusawa believed that business could be carried on according to Confucian ethics; he was steadfast in asserting that capitalists could and should place a strong emphasis on righteousness and benevolence, eschewing greed-oriented profit, despite engaging in competition. This conclusion is made obvious from a number of the chapters in this volume, notably the chapters written by Tanaka Kazuhiro, Geoffrey Jones and Kikkawa Takeo. How much of this commitment was due to Confucianism per se and how much of it was due to experience with Christian-inspired Western thought is less clear. For instance in Chapter 3 Patrick Fridenson argues that the theories of Saint-Simonism may have influenced Shibusawa. What is clear is that Shibusawa’s neo-Confucianism was mainly focused on the aphorisms I cited at the beginning of this review. Adhering to degraded morals drives out good morals; virtue is noble; giving back to the community through philanthropy is essential. It is not simply good advertising. Ethical, community-oriented, capitalism is possible; nay, it is more than possible; it is indispensable. Tragically for Shibusawa and the ethics he espoused, his life came to an end in 1931 just as pendulum swings in fukoku kyohei were propelling Japan away from internationalism onto a fraught-laden path of military aggrandizement he personally deplored. Did he go to the grave believing he had failed?

It is easy to be cynical about business ethics. It is tempting to call it a con job. That said there are decent cons; there are indecent cons; there are actual facts. Without a moral compass self-styled great people cannot be great. To be sure persons devoid of ethical intelligence can become notable; craven con artists strut many a national stage; but they are far, far, far from great. To his credit Shibusawa was sincere in following his moral compass. In that lies his truest greatness.

(Patrick Fridenson is Professor of International Business History at the Recherches Historique at L’Ecole des Hautes Etudes en Science Sociales in Paris. Kikkawa Takeo is Professor at the Graduate School of International Studies, Tokyo University of Science.)

Carl Mosk is Emeritus Professor at the University of Victoria and a lecturer at the University of California at Davis. He is the author of a number of books concerning Japanese economic history including Japanese Industrial History: Technology, Urbanization, and Economic Growth and Japanese Economic Development: Markets, Norms, Structures. His forthcoming book Capitalism and Religion in World History: Purification and Progress explores the long-run global relationship between religious ideology and capitalist ideology.

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Subject(s):Business History
Economic Planning and Policy
Geographic Area(s):Asia
Time Period(s):19th Century
20th Century: Pre WWII

Rulers, Religion, and Riches: Why the West Got Rich and the Middle East Did Not

Author(s):Rubin, Jared
Reviewer(s):Mokyr, Joel

Published by EH.Net (April 2017)

Jared Rubin, Rulers, Religion, and Riches: Why the West Got Rich and the Middle East Did Not. New York: Cambridge University Press, 2017. xxi + 273 pp. $30 (paperback), ISBN: 978-1-108-40005-3.

Reviewed for EH.Net by Joel Mokyr, Departments of Economics and History, Northwestern University.

The Middle East, it has been said, is not just a collection of failed states. It is a failed region. It generates a disproportional number of the world’s orphans and refugees, its GDP per capita is intolerably low despite oil riches, and there are few signs that there is light at the end of tunnel. Democracy seems to have been put on the back burner indefinitely, and human rights are a lost cause in most countries and in retreat elsewhere. Intellectually, too, things look rather dismal: In 2005 Harvard University alone produced more scientific papers than 17 Arabic-speaking countries combined. Muslim countries contribute just 2.5 percent of more than 11.5 million papers published worldwide each year (Muslims constituted 23 percent of the world’s population in 2010). A 1997 Scientometrics paper estimated that 46 Muslim countries (which of course contain much more than the Middle East) contributed 1.17 percent to world science literature as opposed to Spain (1.48 percent).

Is the Islamic religion to blame? Jared Rubin, in this stimulating and highly original study, would deny that emphatically. Although this is a book about religion and its implication for institutional and economic change, Rubin is little interested in the actual doctrinal content of religion. He points out, as many others have, that the essence of Islam could not possibly be as rigid and opposed to commerce and economic change as it may seem, because for the first centuries of its existence, the nations that adopted Islam flourished not just commercially but also in terms of technology, architecture, poetry, agriculture, medicine, and engineering, while western Europe was an ignorant, violent and poverty-stricken backwater. What we have witnessed since 1200 is more than a “divergence”: it is a Great Reversal, of momentous importance till the present day.

Rubin’s book presents us with an explanation for this great reversal, which will have to be taken into account from now on in all future discussions on the economic history of the Islamic world. He does not oversell his argument as the reason for the great reversal, he makes a plausible argument for it as a complementary argument to the ones other serious scholars have made. The book is divided into a few chapters that outline the theory and logic of the argument and then applies these insights to a number of historical case studies. It is a tale that combines economic history, political economy, and religion in a unique and novel way.

Here is the basic argument: any kind of ruler has power because his or her subjects accept their rule and their main concern is what Rubin calls “propagating their rule.”  How do you get people to accept you as their ruler and let you keep your job? Political power is supported by a combination of coercion (that is, violence) and legitimacy (people willingly accept a ruler because they believe that this person has the right to rule them). Through most of history, rulers depended on a combination of the two, though the weights of each differed greatly depending on their costs and benefits. Rubin is exclusively interested in the legitimacy part. Legitimacy is provided by what he calls “legitimizing agents” — groups or entities that have enough influence to make the subjects of the ruler follow instructions and pay taxes. An obvious legitimizing agent is the religious establishment — for example, European rulers once ruled ex dei gratia and called themselves the most Catholic King. Some modern royalty still include the line in their title, although in most places such relics are empty.

Rubin observes that in the early medieval period, both Christian and Muslim rulers used religious authorities as legitimizing agents, but that at some point in the later Middle Ages, Muslim and western European society diverged. Whereas in the Ottoman Empire the sultans continued to rely on religious authorities for their legitimacy, in many western societies the Church’s political leverage was diminished irreversibly. From the beginning, Rubin points out, Christian doctrine envisaged separate spheres for secular and religious power. The schisms and exiles to which the late medieval papacy was subject weakened it greatly in the face of ambitious rulers, and the reformation administered to religious legitimization the coup de grace. Apart from a few corners of Europe such as Spain, religion lost the power it had exercised since even before the prophet Samuel anointed Kings Saul and David.

Why and how did this matter to economic history? Rubin argues that religious authorities were in general conservative, and that the institutions they established are less aligned with commerce and finance than when an economically important elite such as rich urban merchants and artisans are more powerful. As a result of their political influence, religious authorities in the Middle East were successful in blocking critical breakthroughs, most notably the printing press and more sophisticated financial institutions. The printing press facilitated the success of the Reformation, and the Reformation had further favorable economic effects, as has recently been shown by a pair of important papers (Cantoni, Dittmar and Yuchtman, 2016; Dittmar and Meisenzahl, 2016). One might add that even in France, in which the reformation was suppressed, the power of religious authorities to legitimize the king disappeared. Napoleon famously took the crown out of the hands of Pope Pius VII during his 1804 coronation and crowned himself, symbolizing that his legitimization came from military power, not God.

In summary, Rubin argues that the leaders of organized religion tended to be conservative across the board. Their influence, he thinks, depended on their monopoly of eternal truths, and updating those truths threatened to erode their credibility.  The Islamic world was unable to curtail the influence of Islamic scholars until the Islamic world had fallen hopelessly behind Europe. Even within Christian Europe, the power of religious authorities, he feels, helped determine the difference between successful regions such as the Netherlands and Britain and economic laggards such as Spain. When discussing the past three centuries, the influence of religious authorities is somewhat diminished, but what counts in Rubin’s view is that in all poor and backward states, the institutional structure and the capability of key players to “sit at the bargaining table” as he calls it was little affected by the urban-commercial classes whose demands for free and open markets, constraints on the executive, and a rule of law led to rapid economic progress in the north-west corners of Europe.

By combining an institutional argument with religion through the effect that religion had on institutions and politics (rather than on cultural beliefs), Rubin’s argument is reminiscent of an important recent book by Karel Davids, which has not thus far received sufficient attention (Davids, 2013). Both books, in a different way, stress how religious institutions mattered regardless of the precise content of religion. Davids, however, emphasizes another aspect, namely the role of religion in the generation and dissemination of technology. Rubin is primarily interested in institutions that support markets. Yet an explanation of modern economic growth cannot possibly avoid the primum movens of economic growth, which was the rapid expansion and dissemination of useful knowledge. In early medieval Islam, engineers, doctors, and chemists were at the forefront of pushing the envelope. By 1600 the Islamic world had become a follower, by 1800 they were a laggard. A natural extension of Rubin’s idea is that a government dominated by religious authorities will also be less than accommodating to out-of-the-box ideas from natural philosophers, astronomers, mathematicians, and medical doctors. The tradeoff between religiosity and scientific and technological progress has become a serious topic of investigation in recent years (Benabou, Ticchi, and Vindigni, 2014; Squicciarini, 2016). Their findings support the notion that devoutness affects innovativeness negatively and that political institutions could be used by powerful religious leaders to suppress what they considered heretical views.

Rubin is correct in pointing out that in the most progressive countries in western Europe the ability of religious leaders to halt progress was limited.  A striking example of this phenomenon is provided by Amir Alexander (2014), who documents the fierce resistance to infinitesimal mathematics by the Jesuits in the seventeenth century, which seriously slowed down the development of mathematics in Italy. The reason the reactionary powers such as the Jesuits were not able to slow down the development of radical new ideas in Europe materially is primarily the high level of political fragmentation in Europe. If a particular ruler tried to crack down on his most creative subjects because they wrote things he felt to be subversive or heretical, they could always move across the border. Such outside options may have been much more limited in the Ottoman Empire and in China. Interstate competition is another factor that rulers worried about, beside Rubin’s legitimization story. After all, every ruler faced both internal and external threats. Without interstate competition, or “emulation” as eighteenth-century writers called it, Europe might never have had the Enlightenment, which opened the doors to so many of the institutional and technological changes that have helped create economic modernity.

Here and there one could nitpick some of Rubin’s historical interpretations. His account of Spain’s political economy would have greatly benefitted from a closer attention to Regina Grafe’s path-breaking work (Grafe, 2012). Rubin’s agnosticism as to the actual content of religion may be somewhat misplaced: the Sunni revival of the eleventh century did in time move the ruling orthodoxy into a more conservative direction, as Eric Chaney (2015) has shown. More generally, an argument that focuses on “the ruler” and the significance of the propagation of political power may exaggerate the ability of the state to control what the citizens did in pre-twentieth-century societies.

All the same, Rubin has written an important and timely book. His methodology is very much that of the historically informed economist: certain choices are made at some point because they make sense, that is, the benefits to those that make the decision exceed the costs. But once made, these initial conditions can have cascading unintended and unanticipated consequences, and those historically contingent causal chains may well be what drove much of the great and little divergences that our profession is so interested in. Equally important, this well-argued and sensible book about Islam provides a much-needed antidote to the toxic rubbish masquerading as scholarship produced by some of the Islamophobes in the current American administration (e.g., Gorka, 2016). The Middle East’s problem is not Islam; it is History.


Alexander, Amir. 2014. Infinitesimal: How a Dangerous Mathematical Theory Shaped the Modern World. New York: Farrar, Straus and Giroux.

Benabou, Roland, Davide Ticchi, and Andrea Vindigni. 2014. “Forbidden Fruits: The Political Economy of Science, Religion and Growth.” Unpublished working paper, Princeton University.

Cantoni, Davide, Jeremiah Dittmar and Noam Yuchtman. 2016.  “Reformation and Reallocation: Religious and Secular Economic Activity in Early Modern Germany.” Unpublished.

Chaney, Eric. 2015. “Religion and the Rise and Fall of Islamic Science.” Unpublished working paper, Harvard University.

Davids, Karel. 2013. Religion, Technology and the Great and Little Divergences. Leiden: Brill.

Dittmar, Jeremiah E. and Ralf Meisenzahl. 2016. “Origins of Growth: Health Shocks, Institutions, and Human Capital in the Protestant Reformation.” Unpublished.

Gorka, Sebastian. 2016. Defeating Jihad: The Winnable War. Washington, DC: Regnery Publishing.

Grafe, Regina. 2012. Distant Tyranny: Markets, Power, and Backwardness in Spain, 1650–1800. Princeton, NJ: Princeton University Press.

Squicciarini, Mara. 2017. “Devotion and Development: Religiosity, Education, and Economic Progress in 19th-century France.” Unpublished working paper, Northwestern University.

Joel Mokyr is the author of Culture of Growth: The Origins of the Modern Economy (Princeton University Press, 2016).

Copyright (c) 2017 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (April 2017). All EH.Net reviews are archived at

Subject(s):Economic Development, Growth, and Aggregate Productivity
Economywide Country Studies and Comparative History
Geographic Area(s):Europe
Middle East
Time Period(s):General or Comparative

Brahmin Capitalism: Frontiers of Wealth and Populism in America’s First Gilded Age

Author(s):Maggor, Noam
Reviewer(s):Whitten, David O.

Published by EH.Net (April 2017)

Noam Maggor, Brahmin Capitalism: Frontiers of Wealth and Populism in America’s First Gilded Age.  Cambridge, MA: Harvard University Press, 2017. xii + 284 pp. $40 (cloth), ISBN: 978-0-674-97146-2.

Reviewed for EH.Net by David O. Whitten, Professor of Economics, Auburn University.

Noam Maggor, Postdoctoral Associate in the Department of History at Cornell University and formerly a Fellow in the Charles Warren Center for Studies in American History at Harvard University, opens Brahmin Capitalism: Frontiers of Wealth and Populism in America’s First Gilded Age with the pre-Civil War history of Boston wealth and its employment in the construction and expansion of the cotton textile industry in the Boston area.  The return on investments in mills and machine shops attracted capital to the point of over-development that left investors with declining stock values and reduced returns that might well have spelled the end of Boston as a capital-rich city.  What Boston financiers did to reinvent themselves has a commanding role in Maggor’s study.

The first thrust into investments outside of Boston’s textile industry was a failure.  Bostonians — with more ambition than understanding of human behavior and Mother Nature — undertook to prove to the investment world that cotton culture could be as remunerative under free labor conditions as it was under slavery.  Cultivating cotton on a sea island off the coast of South Carolina proved more challenging than the young Bostonians anticipated.  The heat, high humidity, lack of infrastructure, and hurricanes combined with a recalcitrant newly-freed labor force to overwhelm the young men from the North who returned to Boston in defeat.  They might have benefited from knowledge of the experience of ship builders in the early National period who struggled to harvest live-oak trees for construction of the nation’s renowned frigates.  The live oaks thrive in the swampy Atlantic coastal regions of the Southern states.  The parts essential for the best ship construction were acquired but only at heavy expense of human effort and treasure.

The spectacular growth of the American heartland in the post-Civil War era is well documented.  What Maggor adds to that body of literature is a microscopic analysis of the role of Boston investors in that explosive expansion.  Railroad construction required financing as did exploitation of the mines and forests of the United States.  Maggor documents the Boston investors’ contribution to that underwriting.  The Mexican Central Railway, a 1,225 mile road that ran from El Paso to Mexico City, for example, was incorporated under Massachusetts law and controlled by the Boston investment group that owned the Atchison, Topeka and Santa Fe and was directed from Boston where nine of its thirteen directors resided.  The Mexican Central connected with the Atchinson, Topeka, and Santa Fe and feeder lines constructed to regions where remunerative freight could be found.

The moneyed interests in Boston did not invest in a pig-in-a-poke but relied on their men-on-the-ground to advise them on the potential of attractive enterprises — men who devoted themselves to careful study and analysis of the projects they reviewed for their employers in Boston.  Those employers were family and friends of the advance-agents, who saw themselves as missionaries to the great unwashed of the American heartland and who were often surprised at the intellect, cunning and energy of the lower class men they studied.  It was not unusual for the surveyors to assume responsibility for the undertakings they recommended for investment.

Maggor juxtaposes his exposition of the flow of Boston capital into the heartland with discussions of changes in Boston itself.  At the same time that Boston financiers were gaining national influence with their monetary assets they were losing control of their city.  In the heyday of cotton manufacturing and the import/export trade, the city of Boston belonged to the elite.  The controlling offices were held by those with money and ownership of the factories.  With the decline of cotton manufacturing and import/export, Boston became home to small manufacturing and commercial firms whose owners and employees made up in numbers (read votes) for what they lacked in wealth.  Moreover, the lower and middle classes expanded their political power by expanding the city itself, incorporating what had been outlying towns into the city proper over the protests of the moneyed class that considered itself to be the soul of Boston, the people who mattered.  As the nineteenth century advanced, Boston’s elite were increasingly isolated in pockets they were able to defend against the urban juggernaut.  Beacon Hill and later Back Bay became enclaves of the rich and powerful — powerful nationally but increasingly impotent locally.

Maggor showcases the hometown conflict facing the moneyed interests of Boston with a chapter dedicated to the fierce battle over use of the Common.  Using direct quotations from the debaters, Maggor paints a vivid portrait of the positions taken by the combatants or in the case of the moneyed class, their paid spokespersons.  These positions reflected the philosophies of the two sides and their opposing views of their city and their place in it. The rhetorical storm grew out of a request of mechanics in Boston for use of a small part of the Common for an exposition featuring the mechanical advancements of which they were proud.  Similar expositions were common in the decades after the successful Crystal Palace Exposition in London in 1851.  The Common was a barrier between Back Bay, home to a large portion of the moneyed class who saw any intrusion into the sanctuary they portrayed as an urban retreat for the lower classes, as a threat to their privacy and security.

Following the battle for the Common, Maggor investigates the conflict between East Coast investors and the constitutional conventions at work in the states being carved out of the western territories.  Boston investors, like the others in the East, were concerned that state constitutions might infringe on their freedom to harvest the resources of the territories and to regulate the railroads owned by Eastern moneyed interests.  Delegates to the conventions were not of the elite of society but residents of the new states who had vested interests in the operation of their government.  These delegates sought protection from the rich men back east who sought to take off the resources of the state at minimum or no cost and to run rampant over organized labor and any resistance to railroad rate setting.  Representatives of the East Coast moneyed interests played hard ball with the constitutional conventions threatening the loss of investment funds essential to the development of the state.  Neither side won complete victories but the moneyed interests probably gained the most from the negotiations.

Meanwhile, back in Boston the elites built political coalitions that propelled them back into control of their city government.  Once back in power the elected elites strove to undo what the populist administrations had constructed and reduce the support of lower classes that came at the expense of those better off.  The conflict between those dependent upon a strong and well financed city government and those who wanted to reduce that government parallels the national political conflict of the second decade of the twenty-first century.  As Maggor assures us, the development of the United States as an industrial power and leader of the world did not come about smoothly but in fits and starts with uneven results.  Brahmin Capitalism is a guide to the background of that development as it progressed in Boston, a premier leader in investment at home and beyond.

Maggor’s work lacks a bibliography but extensive citations largely make up for that failure.  The writing is like silk, so smooth that it often moves the reader along at such a pace that the underlying meaning of the narrative is missed and demands a second and even third reading.  This is not an easy book to digest.  It demands concentration but makes the effort worthwhile.  Students of business history will benefit from a reading of this work.

David O. Whitten (Professor of Economics, emeritus, Auburn University) is author (with Bess E. Whitten), of Birth of Big Business in the United States: Giant Commercial, Extractive, and Industrial Enterprise, 1860–1914 (Praeger, 2006) and (with Douglas Steeples) Democracy in Desperation:  The Depression of 1893 (Greenwood Press, 1998) and editor of Business Library Review, International (aka Wall Street Review of Books founded by Robert Sobel) from 1976 to 2002.

Copyright (c) 2017 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (April 2017). All EH.Net reviews are archived at

Subject(s):Business History
Geographic Area(s):North America
Time Period(s):19th Century

Paying for Hitler’s War: The Consequences of Nazi Hegemony for Europe

Editor(s):Scherner, Jonas
White, Eugene N.
Reviewer(s):Harrison, Mark

Published by EH.Net (October 2016)

Jonas Scherner and Eugene N. White, editors, Paying for Hitler’s War: The Consequences of Nazi Hegemony for Europe. New York: Cambridge University Press. 2016.  viii + 468 pp. $120 (hardcover), ISBN: 978-1-107-04970-3.

Reviewed for EH.Net by Mark Harrison, Department of Economics, University of Warwick

Paying for Hitler’s War is the outcome of a conference held in Washington, DC, in 2009 under the auspices of the German Historical Institute. Its goal is a deeper understanding of the economics of German occupation during World War II. Eighteen authors, among them the editors, Jonas Scherner (Norwegian University of Science and Technology) and Eugene N. White (Rutgers University), contribute an introduction and three chapters on German war aims for the occupation of Europe and the forms and methods of exploitation of the occupied territories, followed by thirteen more chapters devoted to particular countries or regions of Europe. The latter cover countries that were occupied militarily (France, Belgium, Netherlands, Norway, Denmark, Czechoslovakia, Poland, and Ukraine), as well as neutral Sweden and belligerent Finland and Bulgaria.

As a topic for research, the economics of occupied Europe is not new (see Dallin 1957; Milward 1970, 1972; Liberman 1996; Kay 2006; and Klemann and Kudriashov 2012), but it is far from exhausted. Scherner, White, and their co-authors go beyond the existing literature in geographical detail and also in considering the impact of the wartime occupation regime or other relations with Germany on postwar developments.

Section I is entitled “Germany’s Wartime Dilemma.” The dilemma is not explicitly defined, and there are at least two candidates. One dilemma was the extent to which Germany planned to rely on external versus internal revenues — a blurry distinction, given that by 1940 Greater Germany already included Austria and parts of Poland, Czechoslovakia, and France. Another dilemma was the extent to which Germany could allow short-term confiscation and enslavement to undermine the medium-term sustainability of economic life under occupation.

Chapter 1 (Carsten Burhop) addresses an aspect of the first dilemma. To what extent did the Hitler regime base its war aims on the plans that the German government entertained in the desperate spring months of 1918, when it seemed that Allied resistance might be broken before the German home front collapsed. Did the Kaiser’s Germany inspire Hitler’s later ambitions for a system of dependent states in Eastern Europe and preferential trade with the West? Burhop argues that there is little evidence for continuity. This negative finding usefully closes off one garden path down which lazy thinkers have wandered from time to time. At the same time, here if not in some other chapter, another legacy of the Great War might have been considered: memories of the Allied blockade. In setting their immediate objectives for conquest, Hitler and his circle were strongly influenced by the recollection of Germany’s economic difficulties in World War I, which they attributed to the blocking of German imports by the Allies. Preparing for World War II, they faced the problem that their economy remained dependent on external sources of food and other materials, and they concluded that conquest would provide the means of war.

As things worked out, Germany’s wartime economic exploitation of its neighbors was of major importance for the war. German military spending reached around 70 percent of nominal national income in the later stages of the war, while net foreign saving accounted for 15 percent (Klein 1959: 256). This alone would put the likely contribution of external resources to Hitler’s war spending above 20 percent. But this is a lower bound, to which should be added the contribution of foreign labor to domestic production. Chapter 3 (Johan Custodis) estimates that by 1944 one fifth of the German workforce was made up by foreign workers, forced and “free,” who added as much as ten percent to German production.

Paying for Hitler’s War confirms some of the patterns suggested by past research. The basic extractive methods that Germany imposed were everywhere similar: if you have the power to crush all resistance and the will to use it, you don’t have to adapt sensitively to national or local differences. Chapter 2 (Scherner) shows that in every country the occupation regime imposed a direct tax (occupation costs), an indirect tax (bilateral trade using an overvalued Reichsmark), forced borrowing (unpaid clearing balances), and a labor draft. The combination of these mechanisms extracted a lot or a little, depending on a few basic conditions. Important factors included the prewar level of economic development of the territory, and the extent to which state capacity survived military defeat. In France (Chapter 4, White), Belgium (Chapter 6, Martijn Lak), and the Netherlands (Chapter 7, Kim Oosterlinck and White), the authorities under occupation were able to manage German demands by mixing fiscal and financial repression. Where the state was destroyed, as in Ukraine (Chapter 15, Kim Christian Priemel), looting was the alternative.

Other factors in the intensity of exploitation included the population’s rank in the National Socialist hierarchy of races, the extent of insurgency, and the distance from the front line. Taking everything into account, much more was extracted from Western Europe than from the East. As Chapters 3 and 4  confirm, by 1943 France was transferring more than half of its national output to Germany and at the same time France was the largest supplier of forced and POW labor to the Reich.

In more detail Chapter 3 examines the role of foreign and especially prisoner-of-war labor in the German war economy. Custodis agrees with Klemann and Kudriashov (2012) that the economic losses imposed on the occupied territories by the “hunt for labor” were much greater than the benefits to Germany. Death rates among Polish and Soviet prisoners-of-war were particularly high, depleting these countries’ postwar prospects. Much of this chapter is devoted to hunting down differences among competing estimates; the activity is useful, but could have been placed in an appendix.

This topic shows us that, while German policies were largely the same everywhere, the local experiences of interaction with Germany were almost infinitely variable. While the war continued, these variations were suppressed by the common straitjacket of occupation. When German power collapsed, the local variation exploded: suddenly, every country was different again.

Section II is entitled “The Occupied West.” Chapter 4 focuses on France. German levies were financed by a mix of fiscal and financial repression. Subject to very high rates of extraction, the French GNP collapsed as the war progressed. The end of the war did not cancel all debts, and in France as elsewhere in Europe elites and electorates had lost much of their faith in the market economy, so the exit from a war economy was complicated by the persistence of heavy taxation and financial controls. Marshall Plan Aid and the Treaty of Rome were two steps on France’s gradual path back to a free market economy.

Chapter 5 (Marcel Boldorf) shows that the German occupation of France led to a huge redistribution of rents. Collaboration with the occupation authorities was widespread in the economy, as in government and society. Most branches of the economy were devastated but war suppliers prospered. French businesses often collaborated with former competitors as well as with government, and anti-competitive business ties persisted after the war. Chapters 6 and 7 tell similar stories for Belgium and Netherlands. The wartime burden on the Belgian economy remains unclear, unlike the French burden which looks well established. The burden on the Dutch population was tempered by its “high” racial status, and also by a thriving underground economy. The Dutch postwar recovery was particularly complicated by its dependence on defeated Germany for a revival of trade.

Chapter 8 (Fabian Lemmes) considers German construction projects in France and Italy, administered by the Todt Organization. These accounted for most French and Italian wartime construction, and were implemented through a compliance system that combined rewards and penalties. Their long term consequences remain unclear.

Section III turns to “Northern Europe.” Chapter 9 (Harald Espeli) evaluates Norway’s wartime burdens. These were heavy, partly because the size of the German occupation army was very large relative to a small national population. Still, the chapter argues that war damages and losses were not as heavy as was claimed after the war. As in Western Europe, there was considerable continuity of fiscal and industrial policy into the postwar period, not all of it necessary. Chapter 11 (Steen Andersen) considers Denmark’s “mild” occupation.

Two chapters are devoted to countries that retained their sovereignty in unlikely circumstances. Chapter 10 (Eric Golson) shows that Sweden, sovereign but surrounded, had to offer incentives to both sides to uphold its neutrality. Over time, as the German threat was increasingly confined by the rise of Allied power, Swedish policy adapted flexibly in favor of the Allies. There is a contrast with Sweden, discussed in Chapter 12 (Jari Eloranta and Ilkka Nummela). Having already been attacked by the Soviet Union, Finland ended up going to war on the same side as Germany, even though with much more limited objectives, and paid a heavy price for doing so.

The most devastating outcomes of the war are discussed in Section IV, “Eastern Europe.” There, military defeat was accompanied by the collapse of states and currencies, the tearing up of national boundaries, and the implementation of plans to starve and murder tens of millions of people.

Did Nazi wartime occupation pave the way for Soviet postwar domination in Eastern Europe? Chapter 13 (Jaromír Balcar and Jaroslav Kučera) argues that in Czechoslovakia the occupation was severe but not a disaster. It did not pave the way for a command system after the war. When the governing elite chose its path towards a regulated economy, they were inspired, not forced, by Moscow. Different emphases appear in two other chapters. In Chapter 14 (Vera Asenova), wartime Bulgaria is described as locked into a protected bilateral trade relationship with Germany. When the war ended, the country moved smoothly to a similar relationship with the Soviet Union. Chapter 16 (Ramona Bräu) argues that the devastation of Poland’s physical and human capital under Nazi occupation made it much easier for the communists to impose a centralized command economy after liberation.

A common theme of this heartbreaking book is that the costs of crime to society are generally greater than the gains to the criminal. This was as true as ever when the thief was a state and the instrument was its army. Chapter 15  is soaked in sadness for Ukraine, which “had the worst of the war. Its suffering did not start in 1941 and did not end in 1944, but peaked in between, with its Jewish population suffering near annihilation” (p. 416).

This is a book for specialists. While students and interested lay readers may struggle to extract the pattern from the details, others will find that Paying for Hitler’s War marks an important new stage of scholarship about that tragic conflict.


Dallin, Alexander. 1957. German Rule in Russia, 1941-1945: A Study of Occupation Policies. London: Macmillan.

Kay, Alex J. 2006. Exploitation, Resettlement, Mass Murder: Political and Economic Planning for German Occupation Policy in the Soviet Union, 1940-1941. New York: Berghahn Books.

Klemann, Hein, and Sergei Kudriashov. 2012. Occupied Economies: An Economic History of Nazi-Occupied Europe, 1939-1945. London: Bloomsbury.

Klein, Burton H. 1959. Germany’s Economic Preparations for War. Cambridge, MA: Harvard University Press.

Liberman, Peter. 1996. Does Conquest Pay? The Exploitation of Occupied Industrial Societies. Princeton: Princeton University Press.

Milward, Alan S. 1970. The New Order and the French Economy. Oxford: Clarendon Press.

Milward, Alan S. 1972. The Fascist Economy in Norway. Oxford: Clarendon Press.

Mark Harrison is the author of One Day We Will Live without Fear: Everyday Lives under the Soviet Police State (Hoover Institution Press, 2016).

Copyright (c) 2016 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (October 2016). All EH.Net reviews are archived at

Subject(s):Military and War
Geographic Area(s):Europe
Time Period(s):20th Century: WWII and post-WWII

The Evolution of Everything: How New Ideas Emerge

Author(s):Ridley, Matt
Reviewer(s):Coelho, Philip R.P.

Published by EH.Net (October 2016)

Matt Ridley, The Evolution of Everything: How New Ideas Emerge. New York: HarperCollins, 2015. 360 pp. $29 (hardcover), ISBN: 978-0-06-229600-9.

Reviewed for EH.Net by Philip R.P. Coelho, Department of Economics, Ball State University.

This is a well-written and informative book; it consists of a prologue, sixteen chapters, an epilogue and an index. It is written with a point of view (libertarian right) that may grate on some readers, and its flaws may make it inadvisable to assign to lower-level undergraduates for outside reading.

Matt Ridley begins with a bow to the classical Roman author Lucretius’s extended poem, De Rerum Natura (On the Nature of Things). Each chapter starts with a quote from Lucretius pertinent to the chapter’s contents. Chapter topics are diverse; examples are: The Evolution of the Universe (Chapter 1), The Evolution of Religion (Chapter 14), The Evolution of the Internet (Chapter 16), and almost everything in between. Obviously the book’s ambitions are not modest, and, all-in-all it is a formidable introduction to the scientific and intellectual histories of a number of disciplines. As might be expected, some chapters are substantially superior to others.

The chapters on the physical sciences are excellent. These include the evolutions of the universe (Chapter 1), life (Chapter 3) genes (Chapter 4), technology (Chapter 7), and the mind (Chapter 8). These are substantive and informative. Still a major difficulty that I have with these chapters (and the book in general) is the conflation of the word “evolution” with development and/or history.  Change is not synonymous with the scientific or Darwinian meaning of evolution (which Ridley employs in parts of The Evolution of Everything), but, more than occasionally, he treats “evolution” as if it were synonymous with “history” or “development.” For example, when the author speaks of the evolution of societal attitudes toward same-sex marriage (p. 26) he is really talking about the climate of currently accepted opinion in much of the western world. My criticism of Ridley’s usage of “evolution” to describe changing attitudes towards same-sex unions as evolutionary is not normative; the toleration of same-sex unions could, or could not be, “evolutionary desirable,” where evolutionary desirable means leaving more descendants or out-competing rivals for resources.  It is possible that societies tolerant of same-sex unions may have (for whatever reasons) faster rates of growth than societies that are intolerant. The increase in resources may allow tolerant societies to dominate and surpass less tolerant societies. Using the term “evolution” to describe both evolution in a Darwinian context and as synonym for current trends or fashions may confuse readers.

Other faults with the book are that it is not well documented. An egregious example is in the chapter on the evolution (history) of money.  Ridley writes that: “Joseph Stiglitz, and Peter and Jonathan Orszag . . . concluded [in 2002] that the risk to the government from a potential default of Fannie [the Federal National Mortgage Association] or Freddie [the Federal Home Loan Mortgage Corporation] because of sub-prime lending was ‘effectively zero’ – ‘so small that it is difficult to detect.’” (p. 292). Despite the quotations within this passage there is no footnote to the source for the quotations, nor is the source for the quotation mentioned in the “Sources of Further Readings” (pp. 323-341). Because Stiglitz and the Orszag brothers played important roles in advising the Obama administration and the Congressional Democrats (i.e. the Dodd-Frank banking/financial legislation) I was more than mildly curious about the quote’s provenance. The usual data bases had no mention of the aforesaid quote and its source, so I turned to the undergraduate’s favorite tool and Googled the names and terms, and up popped the source. In short, Ridley’s summary was correct.  Similarly, in the chapter on religion Ridley has a direct quote saying: “In the way they rescued the theory from refutation; but they did so at the price of adopting a device which made it ambiguous” (p. 270). There is no citation and the antecedent is ambiguous. (Karl Popper, the author of the quote is mentioned in the paragraph but so are five other surnames, some of which precede the quote.) Once more Google came to the rescue and identified these as Popper’s words.  Readers should not have to depend on Google to verify quotations and sources.

Ridley’s economic discussions are uneven; he has excellent intuition, still his knowledge of economics has some serious deficiencies in the foundational literature of evolutionary economics. Armen Alchian and his seminal article (1950) on the evolutionary basis of economics are not mentioned. Milton Friedman is quoted for his comments on the internet (also undocumented by Ridley; Google was able to track down Friedman’s internet quote), but Friedman’s Essays in Positive Economics (1953), which competes with Alchian’s article as foundational to evolutionary economics, was not mentioned. Here we have Ridley talking about the evolution of various economics subjects, yet ignoring the intellectual foundations of evolutionary theory in economics; the result is intellectual dissonance.

Ridley is also somewhat haphazard in his command of more recent literature. The discussion on money (chapter 15) deals in depth with the recent financial meltdown, yet he appears to be unaware of the work by Calomiris and Haber (2014) that attributes the Great Recession to government policies that affected banking and the home mortgage industry.  Other examples of ignoring the recent literature are in Chapter 11 (population) where he criticizes the Malthusian’s theory on population and vilifies Malthus without considering the Malthusian intuition that associates increased population density with an increased disease burden (which increased both mortality and morbidity, and these reduced productivity). The Malthusian intuition is an offset to the virtuous cycle postulated by Adam Smith — that increasing population increases market size which increases specialization that in turn leads to increased productivity is limited by the [absolute] size of the market. Robert McGuire and I have written (2011) about this.

In spite of omissions, oversights and errors in Ridley’s economic discussions, he does enlighten and entertain, and provides insights into economic processes. I liken this book to a major university; over all it pursues excellence, still there are deficiencies in some disciplines and specialties that could be improved upon substantially. Ridley is an accomplished and talented author and scholar whom I greatly admire. I am glad I read the book and encourage others to read it, yet a more disciplined approach and an unyielding editor would have made a good book better.


Alchian, Armen A. (1950) “Uncertainty, Evolution, and Economic Theory,” Journal of Political Economy 58 (3): 211–21.

Calomiris, Charles W. and Stephen H. Haber. (2014) Fragile by Design: The Political Origins of Banking Crises and Scarce Credit. Princeton, NJ: Princeton University Press.

Friedman, Milton, (1953) Essays in Positive Economics.  Chicago:  University of Chicago Press.

McGuire, Robert A. and Philip R. P. Coelho. (2011) Parasites, Pathogens, and Progress: Diseases and Economic Development. Cambridge, MA. MIT Press.

Copyright (c) 2016 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator ( Published by EH.Net (October 2016). All EH.Net reviews are archived at

Subject(s):Economic Development, Growth, and Aggregate Productivity
Education and Human Resource Development
Financial Markets, Financial Institutions, and Monetary History
Historical Demography, including Migration
History of Technology, including Technological Change
Markets and Institutions
Time Period(s):General or Comparative