Political Decentralization and Innovation in early modern Europe

My full review of Joel Mokyr’s A Culture of Growth is forthcoming in the Independent Review. Unfortunately, it won’t be out until the Winter 2017 issue is released so here is a preview. Specifically, I want to discuss one of the main themes of the book and my review: the role of political decentralization in the onset of economic growth in western Europe.

This argument goes back to Montesquieu and David Hume. It is discussed in detail in my paper “Unified China; Divided Europe’’ (forthcoming in the International Economic Review and available here). But though many writers have argued that fragmentation was key to Europe’s eventual rise, these arguments are often underspecified, fail to explain the relevant mechanisms, or do not discuss counter-examples. Mokyr, however, has an original take on the argument which is worth emphasizing and considering in detail.

Mokyr focuses on how the competitive nature of the European state system provided dynamic incentives for economic growth and development. This argument is different from the classic one, according to which political competition led to fiscal competition, lower taxes, and better protection of property rights (see here). That argument rests on a faulty analogy between competition in the marketplace and competition between states.  The main problem it encounters is that while firms can only attract customers by offering lower prices (lower taxes) or better products (better public goods), states can compete with violence. Far from being competitive, low tax states like the Polish-Lithuanian commonwealth were crushed in the high-pressure competitive environment that characterized early modern Europe. The notion that competition produced low taxes is also falsified by the well-established finding that taxes were much higher in early modern Europe than elsewhere in the world.

It is also not the case that political fragmentation is always and everywhere good for economic development. India was fragmented for much of its history. Medieval Ireland was fragmented into countless chiefdom prior to the English conquest. Perhaps we can distinguish between low-intensity but fragmented state systems which tended not to generate competitive pressure such as medieval Ireland or South-East Asia and high-intensity fragmented state systems such as early modern Europe or warring states China. But even then it is not clear that a highly competitive and fragmented state system will be good for growth. In general, political fragmentation raised barriers to trade and impeded market integration. Moreover a competitive state system means more conflict or more resources spent deterring conflict. For this reason political fragmentation tends to result in wasteful military spending. It can be easily shown, for instance, that a much higher proportion of the population spent their lives in the economically wasteful activity of soldiering in fragmented medieval and early modern Europe than did in either the Roman empire or imperial China (see Ko, Koyama, Sng, 2018).

Innovation and Decentralization

What then is Mokyr’s basis for claiming that political fragmentation was crucial for the onset of modern growth? Essentially, for Mokyr the upside of Europe’s political divisions was dynamic. It was the conjunction of political fragmentation with a thriving trans-European intellectual culture that was crucial for the eventual transition to modern growth. The political divisions of Europe meant that innovative and heretical thinkers had an avenue of escape from oppressive political authorities. This escape valve prevented the ideas and innovations of the Renaissance and Reformation from being crushed after the Counter-Reformation became ascendant in southern Europe after 1600. Giordano Bruno was burned in Rome. But in general heretical and subversive thinkers could escape the Inquisition by judiciously moving across borders.

Political fragmentation enabled thinkers from Descartes and Bayle to Voltaire and Rousseau to flee France. It also allowed Hobbes to escape to Paris during the English Civil War and Locke to wait out the anger of Charles II in the Netherlands. Also important was the fact that the political divisions of Europe also meant that no writer or scientist was dependent on the favor of a single, all powerful monarch. A host of different patrons were available and willing to compete to attract the best talents. Christina of Sweden sponsored Descartes. Charles II hired Hobbes as a mathematics teacher for a while. Leibniz was the adornment of the House of Hanover.

The other important point that Mokyr’s stresses is Europe’s cultural unity and interconnectedness. As I conclude in my review, Mokyr’s argument is that

“the cultural unity of Europe meant that the inventors, innovators, and tinkers in England and the Dutch Republic could build on the advances of the European-wide Scientific Revolution. Europe’s interconnectivity due to the Republic of Letters helped to give rise to a continent-wide Enlightenment Culture. In the British Isles, this met a response from apprentice trained and skilled craftsmen able to tinker with and improve existing technologies.  In contrast, political fragmentation in the medieval Middle East or pre-modern India does not seem to have promoted innovation, whereas the political unity of Qing China produced an elite culture that was conservative and that stifled free thinking”.

It is this greater network connectivity that needs particular emphasize and should be the focus of future research into the intellectual origins of growth in western Europe. At present we can only speculate on its origins. The printing press certainly deserves mention as it was the key innovation that helped the diffusion of ideas. Mokyr also points to the postal system as a crucial institutional development that enabled rapid communication across political boundaries. Other factors include the development of a nascent European identity and what Chris Wickham calls, in his recent book on medieval Europe, “the late medieval public sphere” (Wickham, 2016). These developments were important but understudied complements to the fragmented nature of the European state system so frequently highlighted in the literature.

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Highly recommended work on Ayn Rand

Most scholarship on Ayn Rand has been of mediocre quality, according to Gregory Salmieri, the co-editor of A Companion to Ayn Rand, which is part of the series “Blackwell Companions to Philosophy.” The other co-editor of the volume is the late Allan Gotthelf, who died during it’s last preparatory stages.

The reasons for the poor scholarship are diverse. Of course Rand herself is a large element. She hardly ever participated in regular academic procedures, did not tolerate normal academic criticism on her work and strictly limited the number of people who could authoritatively ‘explain’ her Objectivist philosophy to herself and Nathaniel Branden. Before her death she appointed Leonard Peikoff as ‘literary heir’. She inspired fierce combat against the outside world among her closest followers, especially when others wrote about Rand in a way not to their liking. The result was that just a small circle of admirers wrote about her ideas, often in a non-critical way.

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On the other hand, the ‘rest of the academy’ basically ignored her views, despite her continued popularity (especially in the US), her influence, particularly through her novels, and large sales, especially after the economic crisis of 2008. For sure, Objectivists remain a minority both inside and outside academia. Yet despite the strong disagreement with her ideas, it would still be normal to expect regular academic output by non-Randians on her work. Suffice it to point to the many obscure thinkers who have been elevated to the academic mainstream over the centuries. Yet Rand remains in the academic dark, the bias against her work is strong and influential. This said, there is a slight change visible. Some major presses have published books on Rand in the past years, with as prime examples the books by Jennifer Burns, Goddess of the Market: Ayn Rand and the American Right (2009), and Anne C Heller, Ayn Rand and the World She Made (2010). And this volume is another point in case.

One of the strong points of The Blackwell Companion on Ayn Rand is that the contributions meet all regular academic standards, despite the fact that the volume originates from the Randian inner circle. It offers proper explanation and analysis of her ideas and normal engagement with outside criticism. The little direct attack on interpretations or alleged errors of others is left to the end notes, albeit sometimes extensively. Let us say, in friendly fashion, that it proves hard to get rid of old habits!

It should not detract from the extensive, detailed, clearly written and plainly good quality of the 18 chapters in this companion, divided in 8 parts, covering overall context, ethics and human nature, society, the foundations of Objectivism, philosophers and their effects, art and a coda on the hallmarks of Objectivism. The only disadvantage is the large number of references to her two main novels, The Fountainhead and Atlas Shrugged, which makes some acquaintance with these tomes almost prerequisite for a great learning experience. Still, as a non-Randian doing work on her political ideas, I underline that this companion offers academically sound information and analysis about the full range of Rand’s ideas. So, go read it if you are interested in this fascinating thinker.

Silent Majorities: Mass Incarceration Edition

What vexed [political scientist Michael] Fortner was that The New Jim Crow seemed to be two different books. One did a powerful job showing how mass incarceration undermines black communities and perpetuates racial inequality. The other — and this was the vexing part — advanced a political theory about how we got here. That history stressed the resilience of white supremacy. First came slavery; when slavery ended, a white backlash brought Jim Crow segregation; when Jim Crow crumbled, a backlash to the civil-rights movement spawned yet another caste system, mass incarceration. Each time, writes Alexander, an associate professor of law at Ohio State University, proponents of racial hierarchy achieved their goals “largely by appealing to the racism and vulnerability of lower-class whites.”

“I remember feeling like, where are the black folks in this story?” Fortner says. “Where are their voices? They’re constantly victimized. They’re not powerful. And then I thought about, well, who the hell brought down the original Jim Crow? It was black power. It was black folk organizing, mobilizing successfully against racial structures in the South, in the North. And what happened to all that power? What happened to all that agency? It sort of disappeared.”

Except it didn’t. By examining historical records, Fortner found that black people had retained their power when it came to crime policy. At one place, in one moment, their voices were critical: Harlem in the years leading up to the Rockefeller drug laws. It was there that residents were besieged by heroin addiction and social disorder — what a late-1960s NAACP report called a “reign of criminal terror.” And it was there that a “black silent majority” of working- and middle-class residents rallied to reclaim their streets. New York’s ambitious governor seized on their discontent to push for harsh narcotics policies that would enhance his standing within the Republican Party. The result: some of the strictest drug statutes in the country, mandating long minimum sentences for a variety of drug crimes.

More here. By Marc Perry writing in the Chronicle Review.

Larry Siedentop’s Straw Dog

I finally had the chance to finish reading Larry Siedentop’s Inventing the Individual: The Origins of Western Liberalism.

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It is a great book, and especially informative for those not well-versed in the intellectual history of political ideas within (mainly) Christian thought. The arguments starts with the Ancient traditions, to the early years of Christianity, all the way to the fifteenth century. According to Siedentop (p. 332) the main goal of the book is:

‘to show that in its basic assumptions, liberal thought is the offspring of Christianity. It emerged as the moral intuitions generated by the Christianity were turned against an authoritarian model of the church. The roots of liberalism were firmly established in the arguments of the philosophers and canon lawyers by the 14th and 15th centuries: belief in the fundamental equality of status as the proper basis for a legal system; belief in that enforcing moral conduct is a contradiction in terms; a defense of individual liberty, through the assertion of fundamental or ‘natural rights’ and, finally, the conclusion that only a representative form of government is appropriate for  a society resting on the assumption of moral equality’.

Siedentop clearly succeeds in making this point. As said, the book can be warmly recommended. The question is, however, why does he care about this issue? Siedentop (pp. 334-338) clarifies that he wants to fight the dominant idea that liberalism sprang from the Renaissance, and that liberalism almost equates secularism, or is even anti-religion, at least in the public sphere.

You do not need to be a scholar of the liberal history of ideas to raise more than a few eyebrows here. What liberalism is Siedentop taking up for argument? He is unclear about this, as he does not care to define this liberalism, nor does he provide references to liberal thinkers. That is where the trouble starts.

Undoubtedly there are some modern social-liberals who claim that liberalism is secular and that the state and lawmaking should be strictly neutral in religious terms. Arblaster in The Rise and Decline of Western Liberalism even explicitly refutes any liberal traces before the Renaissance. Unclear is how dominant these voices are, especially outside academia. One thing is certain, these do not comprise classical liberals.

In the Scottish Enlightenment, in many ways the birth grounds of classical liberalism, the place of religion in life, and religion as a source of morality, was discussed. In contrast to most other thinkers, -Smith included- Hume even criticized religion, albeit most openly  after his death in Dialogues concerning Natural Religion. Yet to my knowledge, no thinker actually denied the role of Christianity as a source of  important ideas, certainly not the  role of individuality.

Modern writers, who are more aware of classical liberalism as a tradition do not deny this either. Let me give a few examples.

Hayek in an essay on liberalism (in New Studies in Politics, Philosophy Economics and the History of Ideas) writes that it traces back to classical antiquity and certain medieval traditions. He actually attacks ‘some nineteenth century writers’ who denied ‘that the ancient knew individual liberty in the modern sense’. In his general overview entitled Liberalism, John Gray (then still in his liberal days), also neatly points to the pre-modern and early modern times for the development of liberal ideas as we now know them. David Schmidtz and Jason Brennan pay their due respect to these older sources in A Brief History Of Liberty and the same goes for George H. Smith in The System of Liberty, and David Boaz in The Libertarian Mind.

Of course, none of them made detailed studies of these influences because their books had different purposes than Siedentop’s. Yet all deal with it in a few paragraphs or even a separate chapter, making clear to their readers that (classical) liberalism has older roots then the Renaissance, that there are important Medieval and Ancient thinkers who all left their mark on the development of (classical) liberal thought.

Siedentop wrote a great book, that unfortunately is a straw dog as well: his portrayal of ‘liberalism’ is erroneous, either deliberately or not. It denies the views of the founding and one of the main liberal variants. That is sloppy, to say the least, for such a learned and experienced scholar. With the use of these general terms Siendentop’s attack is simply off target. He should have taken far more time to define the ‘liberalism’ and the liberal scholars subjected by his attack.

How about war, Professor Wall?

The Cambridge Companion to Liberalism

There is a lot of truth, insight and wisdom in this Cambridge Companion to Liberalism. But how on earth is it possible that there is no substantial mentioning, let alone analysis, of the political philosophy of liberalism and international relations? At least a weird omission by the editor, Professor Steven Wall, I must say….

My latest book review: Rafia Zakaria’s “History of Pakistan”

The other pertinent issue raised by Rafia is about the patriarchal structure, which is a political institution now sanctioned by religious practices and with social acceptance. The plight of women is considered to be a private affair but it is a political programme through which one gender controls the activities of the other. It defines values and sets up norms to control and regulate the body of women. This control and regulation becomes strong in conflict-affected societies where the level of violence is high. The stronger group tries to abduct and carry out violence against women from other communities while the minority, in the name of protection of its ‘honour’, puts all forms of restrictions on their women and carries out violence against them within their own community.

Read the rest.

Review of “The Age of Abundance: How Prosperity Transformed America’s Politics and Culture”

I just finished one of the best books I’ve read in a long time, so even though it’s been out since 2007 I’m going to review it: “The Age of Abundance: How Prosperity Transformed America’s Politics and Culture” by Brink Lindsey.  A second subtitle reads, “Why the Culture Wars Made Us More Libertarian.” It would be a shame if that subtitle put off some potential readers because the book isn’t a libertarian tract, not by a long shot. It’s a fine piece of sociological analysis, rigorous yet readable.

I lived through the post-war transformation of America but that doesn’t mean I really understood what was going on. I understand a whole lot better now thanks to Lindsey’s book. My mother struggled through the Great Depression, by necessity developing a scarcity mentality, some of which rubbed off on me. But as postwar abundance spread, overcoming scarcity was the driving motivation for fewer and fewer people. Instead, mass affluence became the norm. My cousin in Ohio, for example, spent his entire working life as a diesel mechanic for Ford Motor Co. Over the years he and his wife acquired a nice house, a boat, three cars, and took cruises abroad. He worked very hard, but so did his forebears, and they never had what he had.

Mass affluence gave people free time and energy to explore the meaning of life. The New Age, or the Aquarian movement as Lindsey calls it, burst forth in the 1970’s. Having participated peripherally in some of the “personal growth” movements of the time, I can attest to two things. First, most of it was nonsense. I’m chagrined to look back on some of the groups I got into, and glad that I never went overboard with any of them. Second, I’m grateful for some of the genuine growth I experienced during those times. Crucially, I never questioned the work ethic that I inherited from my mother. I grew a beard, but otherwise dressed conventionally and held a steady job.

Almost nobody in the personal growth movements of the time understood that they owed their newfound freedom to mass affluence and that that affluence resulted from the capitalist system which many of them liked to deride. (An exception would be the tiny libertarian movement of the time which for some people was allied with the personal growth movement.) Most participants looked down their noses at hard workers like my cousin.

As it happens, the capitalist system not only survived the Aquarian onslaught but found ways to make a buck from it, adapting and softening its revolutionary fashions, music, and entertainment for a mass market. Capitalism, far from keeling over, co-opted the movement and moved on.

Then came the evangelical backlash, a movement I never had any truck with. The system survived the evangelicals’ attacks on personal liberties.  The upshot, says Lindsey, is that while these two forces pulled at the capitalist center (or the free-market center as I prefer to call it), the system survived and has actually thrived. Out of it all, we are learning to balance liberation and responsibility. Here’s how he puts it on p. 316 of the hardcover edition:

Out of the antitheses of the Aquarian awakening and the evangelical revival came the synthesis that is emerging today. At the heart of that synthesis is a new version of the middle-class morality—more sober, to be sure, than the wild and crazy days of “if it feels good, do it,” but far removed from old-style bourgeois starchiness or even the genial conformism of the early postwar years. Core commitments to family, work, and country remain strong, but the are tempered by broad-minded tolerance of the country’s diversity and a deep humility about telling others how they should live.

As you can tell, Lindsey is a masterful story teller. He adds statistics occasionally; more would have been welcome. I doubt that he will ever get his material published in a sociology journal. Not only is he “politically incorrect” but his writing is too clear and too compelling. By the way, do you see the dialectics in this passage? Lindsey never uses the word, but there it is: Aquarian thesis, evangelical antithesis, libertarian synthesis. Fascinating.