Published by EH.NET (January 2006)

Frederic L. Pryor, Economic Systems of Foraging, Agricultural, and Industrial Societies. New York: Cambridge University Press. 2005. xvi + 316 pp. $31.76 (paperback), ISBN: 0-521-61347-7.

Reviewed for EH.NET by George Grantham, Department of Economics, McGill University.

Certain books can be considered experiments. The extended essay is the most common form; Frederic Pryor’s present attempt to empirically extract a taxonomy of economic systems from a set of social statistics is another. Not all experiments succeed, but the failures can often teach us as much as the successes. Pryor’s experiment in economic phenomenology falls in the class of useful failures. Its use is to demonstrate why the phenomenological approach to economic and social modeling is unlikely to yield useful insights, an argument advanced long ago by Tjalling Koopmans. The question that motivates Pryor’s attempt is nevertheless fundamental. Is there such a thing as an ‘economic system,’ and if so, do such systems arrange themselves into taxons defined by empirically verifiable traits? And if traits do cluster in ways suggesting organically coherent ensembles, can that coherence be explained by a generally accepted behavioral theory? These questions comprise the program of comparative economic systems, a field that despite the potentially large contribution of insights to be gleaned from game theory has fallen into neglect since the collapse of the Soviet Empire destroyed the major systemic alternative to western capitalism.

Pryor adopts the statistical procedures of cluster analysis to empirically define ‘systems.’ The obstacles to successful prosecution of this program are legion. The first resides in the nature of the sample, which for the non-industrial societies was drawn from the Standard Cross-Cultural Sample (SCCS) compiled by Murdock and White in the 1960s from ethnographical reports and accounts by missionaries, travelers and government officials. Its heterogeneity needs hardly to be mentioned. The industrial and post-industrial sample comes from the OECD, for which the problem is not so much heterogeneity as homogeneity begging the question, in what essential ways do the highly integrated economies of northwest Europe individually represent distinct ‘observations’ rather than manifestations of a single case characterized by internal regional variation? Another obstacle is the qualitative nature of the attributes, which for statistical purposes must be coded by unavoidably arbitrary criteria grouping them into analytical classes. Even making due allowance for Pryor’s considerable skill and great erudition, one may question whether the boundaries represent real lines of division.

In any event, the proof of experimental economics is in the pudding, and Pryor’s pudding yields few plums. He finds six varieties of foraging societies based on such characteristics as level of economic development, degree of wealth-sharing, extent of private landownership, presence of taxation and the importance of taxes and tributes, but no obvious explanation for the observed differences. Among societies representing the transition from foraging to farming, he finds some (but not much) evidence for population pressure, but the direction of causation is unclear. Among agricultural societies, he finds four basic types based essentially on the intensity of land use; the clusters are loose and overlap. One may question the logic of farming societies from regions as distinct as Sub-Saharan Africa, South America, the Middle East and Southeast Asia. As to results, it is hardly surprising that societies that practice mixed farming use more capital per hectare than those who don’t.

In the analysis of societies transiting from agriculture to industry, we move from the small individual societies of the SCCS sample to nation-states. While the shifting focus is largely dictated by the nature of the data, Pryor’s procedure begs the important question of what level of spatial aggregation is appropriate for analyzing the Industrial Revolution, which a century of intensive scholarship has yet to resolve. As to the correlations, Pryor finds that literacy mattered, at least in a statistical sense; agricultural productivity mattered some, but not much, and urbanization not at all, mainly because Italy and Spain were comparatively urbanized in the sixteenth century, but failed to initiate industrialization. It is hard to know what to make of this farrago of straw men. The degree of commercialization, or what he calls ‘Marketization,’ mattered, though it is a legitimate question whether the measure picks up anything more than the development of a dense commercial infrastructure capable of sustaining greater specialization, industrial or otherwise. In short, the ‘findings’ are what one expects, because they report what one already knew. The OECD sample of ‘advanced post-industrial societies’ clusters into three groupings: southern European, Northern European (including its English-speaking offshoots), and Nordic. One hardly needs to read the chapter to predict it. Whether the differences are meaningful in the sense of representing taxonomically different economic ‘systems,’ however, is open to question. They may represent different points in a process of convergence, or random fluctuations around a mean ‘type.’ Cluster analysis provides no basis for distinguishing these possibilities from the hypothesis that they represent true ‘types.’

The one distinct type of modern society was the totalitarian type represented in recent decades by the Soviet regimes of Eastern Europe. Here Pryor, as a specialist on East Germany (and at one time a hostage in an East-West spy exchange negotiation) is on ground he knows well. For the Soviet regimes did, indeed, constitute a self-consciously distinct system. Although it contains little that is new, the review is insightful and useful. In particular, Pryor refutes the hypothesis that the Marxist regimes fell because of absolutely poor economic performance. For several decades that performance, measured conventionally as growth in real GDP per capita was quite respectable, and in some instances outstanding. Measured against underdeveloped countries it was quite good; measured against the nations sharing a common cultural heritage, however, the level of per capita consumption achieved in the Marxist states was poor and worsening. As one expects, both static and dynamic efficiency were much lower than in the capitalist OECD economies.

In the end this is a disappointing book. Perhaps its most useful feature is its extensive bibliography. Pryor reads widely and intelligently. On the whole, his judgments on the literature he surveys are accurate and sound. The fatal flaw of this book lies in the undemonstrated presumption that societies organize themselves into structural wholes. That this must in some sense be true is plausible: we do not observe a random assortment of economic forms. Whether empirical links between different attributes are necessary or contingent is a different matter altogether. The study of comparative economic systems originated in the late eighteenth century out of concerns that the growing commercialization of life was breaking down traditional social and political structures which (excepting conflicts over religion) had ensured relative peace for centuries. Though not brand new, the accelerating pace of commercial contact and industrialization suggested the onset of a new form of economy and society, which in turn encouraged the study of primitive and peasant societies as a source of generalizations from which alternative models of social organization might be constructed. The Bolshevik experiment provided an actual example of a society founded on alternative principles. None of this work, however, was supported by much in the way of theory; the stages theory of evolution was essentially a typological description of what was then supposed to be the story of Europe’s economic development since the fall of the Roman Empire. The actual stages, like the ethnological reconstructions, were ideal types, maintained by a logic that was nowhere clearly articulated. As Teggart noted almost a century ago, that logic was essentially aesthetic.

Pryor’s effort to supply an empirical basis to this paradigm is admirable. But the original weaknesses of the taxonomical approach to large-scale economic forms are ever-present. As an abstract category, an economic system is too large and too complex to be characterized by a set of attributes. The distinction between the Soviet totalitarian economy and the western market economies was sui generis, and one hopes, permanently unique. This is an interesting book, but not a fundamental one.

Grantham is currently working on, among other things, an intellectual history of the discipline of economic history.