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20 April 2022

Oded Galor explores the ancient roots of modern life

In his new history the economist chronicles how humanity escaped subsistence poverty, bringing prosperity, longevity and lasting inequality.

By Simon Kuper

Why do some regions today have stronger gender biases than others? Why, for instance, are there fewer women in the workforce and boardrooms of southern than northern Europe? It may, in part, go back to the plough and the hoe. In regions where the nature of the soil and the local crops favoured animal-drawn ploughs, typically only men had the upper-body strength to control the animals. Women therefore tended to be limited to housework. But in regions where people farmed with hoes and rakes, men and women shared the work. That history shaped lasting attitudes to gender roles, hypothesised the Danish economist Ester Boserup.

The plough versus the hoe is one of many fascinating examples in Oded Galor’s book of the ancient roots of modern life. Galor, an Israeli economist at Brown University in the US, is the pioneer of what he calls unified growth theory – a wildly ambitious attempt to do for economics what Newton, Darwin or Einstein did for their fields: develop a theory that explains almost everything.

Galor, now approaching 70, has been pursuing this grail for decades, but The Journey of Humanity is his bid to put it before a popular audience. The book aims to “present an interdisciplinary, scientifically based narrative of the evolution of societies since the emergence of Homo sapiens”. Using all of history as his source material, Galor also tries to answer one of the great questions of economics: why are some societies rich and others poor?

His project, in short, is to walk us through history seeing the wood rather than the trees. Historians, he complains, tend to focus on events: wars, revolutions, stock-market crashes. But Galor doubts the power of events to derail humanity’s journey. Two world wars and the 1918 flu pandemic, for example, couldn’t stop last century’s surge in life expectancy.

In his telling, our history more or less divides into two halves falling either side of the Industrial Revolution. In 1798, the English cleric-economist Thomas Malthus looked back on the human journey and devised what might be called his “unified non-growth theory”. In An Essay on the Principle of Population, he explained that population growth kept humans perennially poor. Whenever new technology generated more wealth, people used the proceeds to have more kids, and so, with more mouths to feed, they always eventually reverted to subsistence level.

[See also: Steven Pinker and the problem with rationality]

Galor believes that when Malthus wrote this, he was correct. In the 12,000 years until 1800, human populations grew 400-fold. A bigger population meant a more sophisticated society: not everybody in a city like Babylon or Rome had to farm, so classes of non-food-producers arose, people who could expand knowledge and invent technology. But as growing populations consumed any extra production, life for millennia remained nasty, brutish and short.

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Galor reckons that the average daily working wage in Babylon more than 3,000 years ago was the equivalent of about 7 kilograms of wheat. In Athens over 2,000 years ago, it was 11 to 15 kilograms. And in Paris just before the Industrial Revolution, it was 5 kilograms. From the dawn of humanity until about 1800, average life expectancy in almost all societies for which we have evidence seems to have remained stuck between about 30 and 40 years.

Then, just as Malthus published his theory, the human story changed. Starting in newly industrialising Britain, Homo sapiens achieved lift-off, though the Industrial Revolution wasn’t exactly a turning point, as Galor sees it. There was no specific invention that suddenly increased productivity. Rather, change happened progressively throughout the 19th century, largely because all the new machines changed family structures.

Before the 19th century, a family that had advanced beyond subsistence was incentivised to have more children. Children cost little in that period, because there was almost no point educating them, and once they were about four years old you could put them to work in the fields or the home. Suddenly, when modern factories emerged and the service economy began to develop, a family’s calculations changed. For the first time in history, having some schooling – at least to the level of being able to read – became a way to earn more than the wages from unskilled work, especially that done by physically weak children, so demand for child labour fell. We associate the Industrial Revolution with child labour, but Galor says that this was precisely the point in history when countries began banning it.

This new world changed family incentives. Instead of having lots of children and sending them out to work, parents began to have fewer, and to spend money educating them, so that the kids could earn more over their careers. This was a particularly good investment once improved medical knowledge extended lifespans. Industrialised countries needed skilled workforces, so during the 19th century they began making school compulsory. As machines replaced male muscle, women’s wages began to rise towards those of men. This provided a further incentive to have smaller families: having fewer children meant women could work more.

The world’s most advanced countries thus began to escape the Malthusian trap: technology was making them richer, and people were having fewer children, so for the first time human living standards improved, even transformed. In the US between about 1890 and 1940, most people acquired indoor toilets, electricity, telephones, cars and ever more education.

Eventually the whole world lurched forward. “Since the dawn of the 19th century,” writes Galor, “a split second compared to the span of human existence, life expectancy has more than doubled, and per capita incomes have soared 20-fold in the most developed regions of the world, and 14-fold on planet Earth as a whole.” In case you’ve been feeling pessimistic lately: between 1953 and 2019, global life expectancy rose from 47 years to 73.4.

Galor also wants to explain the disparities between regions, and so he asks: why did the Industrial Revolution start in northern Europe and the US and only reach most countries 150 years later (or, in a few cases, is still to arrive)? As ever, he seeks underlying reasons rather than proximate causes.

There’s the long-standing explanation that northern Europe benefited from its mild, rainy climate, and its relative freedom from endemic diseases. Before 1500, Europe’s dominant crop, barley, “yielded almost twice as many potential daily calories (per acre) as the corresponding crop in sub-Saharan Africa (peas),” he writes. Moreover, Europeans could farm livestock, something that the tsetse fly made almost impossible in Central Africa.

Over the long term, polling evidence from the ongoing European Social Survey and the World Values Survey suggests that these agricultural advantages affected Europeans’ outlook: people from regions with high crop yields are rewarded for being future-oriented. That encourages them to save, spend on education and adopt new technologies.

Thriving European agriculture allowed large numbers of people to live near each other, exchanging ideas. Cross-Channel ferries have been sailing between Dover and Calais for nearly 900 years. People living on the coasts of what are now southern England, Belgium and northern France were regularly visiting each other by boat in the Bronze Age.

[See also: The men who reinvented warfare]

What has made this exchange of ideas particularly productive, argues Galor, is that Europeans are divided into different national traditions, each with its own knowledge and mindset. He contrasts this with China, whose most fertile regions have been unified for 2,300 years. Europe’s national divides owe much to geography.

The British could build their distinct traditions because the sea mostly protected them from invasions. The Pyrenees, Alps and Carpathians provided their own obstacles to invaders, as did the bays and peninsulas of Italy, Spain, Greece and Scandinavia. Consequently, nobody ever succeeded in unifying the continent. Different European nations and language groups arose, competed and stole each other’s ideas. When the Genovese sailor Christopher Columbus couldn’t get funding for his transoceanic voyage in Portugal or England, he tried Spain. In short, Galor’s method doesn’t focus on a figure such as Columbus, but on the deeper conditions that made a Columbus possible.

In what feels like one of the book’s moments of overreach, Galor tries to quantify the contribution of underlying factors to today’s “variation in prosperity between nations”. He concludes that “geoclimatic characteristics account for about two-fifths”, “the disease environment for about one-seventh”, while “ethnocultural factors account for one-fifth”. An example of a northern European ethnocultural advantage would be Protestantism: Galor, drawing on Max Weber, argues that the new religion encouraged hard work and thrift, and provided a moral justification for getting rich.

By contrast, Galor is much less interested in political institutions. He is willing to concede their impact here and there. Clearly, he says, the wealth gap between North and South Korea isn’t due to geography or culture but because the north went communist and the south didn’t. Similarly, he acknowledges the role of political happenstance in England’s transformation from feudal backwater to motor of the Industrial Revolution: after the Glorious Revolution installed the Dutchman William of Orange on the English throne in 1688, the king, having no domestic support base, depended on parliament. This gave a voice to “the rising mercantile class”, and so England began to favour private property, enterprise and some degree of equality of opportunity.

Later, colonialism strengthened Europe’s lead over the rest of the world. Europeans armed with advanced weapons technology and deadly germs decimated native populations. They then oversaw the rise of a new sort of global trade, in which they supplied the technology and the colonies had to produce the raw materials. Remarkably, “developing economies experienced a decline in per capita industrialisation during the 19th century”. The decline was particularly marked in India, which had been a major textile exporter before the British arrived. Especially in colonies whose climate and soil were suited to large plantations, such as the Caribbean and the southern US, settlers were incentivised to exploit an unskilled workforce. In these conditions, parents saw little gain in educating their children, and so families remained large and the Malthusian trap persisted.

[See also: How to handle an uncertain future]

Much of this story is familiar in outline, but Galor deserves great credit for distilling it – clearly and sometimes elegantly – into a short book. One of his central claims is new to me, and intriguing, though he provides little evidence to substantiate it. He estimates that perhaps a quarter of the differences in prosperity between nations are due to human diversity. By this he means “the degree of cultural, linguistic, behavioural and physical diversity” in each society. Homo sapiens arose in East Africa, and lived and developed there longest – and so that region is today the world’s most diverse; Galor deems Ethiopia the apogee. By contrast, the further humans strayed from East Africa, the smaller and less diverse were the travelling groups. He cites Bolivia as one of the world’s least diverse countries.

Now comes his claim: too much diversity is bad for prosperity, but so is too little diversity. Highly diverse societies are prone to conflict but homogeneous societies tend to be less innovative. The Goldilocksian ideal, Galor argues, is a moderately diverse society. He calculates that if Bolivia could “foster cultural diversity, its per capita income could increase as much as fivefold”. At the other end of the scale, if Ethiopia adopted policies “to enhance social cohesion and tolerance of difference”, it could double average incomes.

Despite his preoccupation with global prosperity gaps, Galor is short on solutions. He is sceptical of efforts to give poor societies Western-style institutions, such as independent central banks or laws protecting property. Instead, he argues, somewhat vaguely, for spreading education and gender equality – the developments that helped northern Europe escape the Malthusian trap 200 years ago.

Taking the Galorian millennia-long view, the Industrial Revolution and its aftermath have endangered human survival, but his prescription for countering climate change is weak. He’s hopeful that the formula of the Industrial Revolution – more tech, less fertility – will save us. Global fertility has plummeted – from five children per mother in 1970 to 2.4 in 2016 – and forecasts for the global population in 2050 have fallen to 9.7 billion, but CO2 emissions continue to rise.

Two hundred years ago, escaping the Malthusian trap took a cumulative technological leap. In our time, if we are to capture enough carbon or run the world on renewables, we’ll need a more sudden technological miracle. Galor’s book has its repetitions, and a sometimes illogical structure that weaves back and forth in time. Yet this is an inspiring, readable, jargon-free and almost impossibly erudite masterwork, the boldest possible attempt to write the economic history of humanity.

The Journey of Humanity: The Origins of Wealth and Inequality
Oded Galor
Bodley Head, 304pp, £20

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This article appears in the 20 Apr 2022 issue of the New Statesman, Law and Disorder