Rich nation, poor nation
David Landes explores the wealth disparities between nations from the Middle Ages to the present in “The Wealth and Poverty of Nations”
Cover of “The Wealth and Poverty of Nations: Why Some Are so Rich And Some so Poor” by David Landes.
Landes, D. (1999). The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor. W.W. Norton & Company, Inc. 658 pages.
Overview
Understanding why some societies flourish while others stagnate or decline is a crucial point of inquiry in economics, history and politics. Scholars have sought explanations for the West’s rise over non-European peoples and civilizations since roughly 1500, often taking a historical approach to the question.
In The Wealth and Poverty of Nations (1999), David Landes, professor emeritus at Harvard University (who passed away in 2013), has a controversial answer to the question. He argues that rich nations became rich and poor nations became poor because of culture (p. 516), which manifested into favourable institutions, immense wealth and eventually knowledge (p. 276). Additionally, he argues that the West’s rise originated in Europe’s Middle (Dark) Ages, far earlier than commonly believed.
He claims that Britain’s dominance was no mere geographic accident because its values allowed it to accumulate significant wealth and prominence (chapter 16). The Americans eventually overtook the British with their enterprising spirit, love of private property, curiosity and superb manufacturing prowess (p. 19). On the other hand, the Japanese were the first non-Europeans to rise above the rest thanks to their mercantilist ethic, clever thinking, and yearning to succeed (chapter 22).
Meanwhile, most other societies were falling further behind. The Spanish and the Portuguese indulged themselves and refused to fund productive ventures (chapter 20). The Chinese were uncreative and uncurious, never challenging the status quo (p. 21). And the Middle East remained trapped in its dogma, sexist and uninterested in external thought that challenged their religious beliefs (p. 412-413).
These are just some case studies Landes explores, and readers are sure to be intrigued, delighted and offended when reading this book.
How is this book similar?
Landes’ explanation for the West’s rise is similar to others. He agrees that geography played and continues to play an essential role in development, either aiding or impeding it. Western Europe, he says, is blessed with frequent warm winds and rain from the Gulf Stream, making it easier for the populations residing there to reap higher crop, livestock and resource yields. The situation is different for central and eastern Europe, where the rains cannot travel as far, resulting in dryer and colder climates inimical for development (chapter 2). Europe’s environment is different from places like the Amazon rainforest, which some think is more suitable for development because of the variety of fauna and flora. However, Landes claims that it is difficult to farm in rainforests due to the torrential downpours and hot sun, which dries out soil and turns it into clay, making it nearly impossible to till for agriculture. Modern technological and medical techniques are required to thrive in such extreme climates.
Geography played a decisive developmental role for societies within continents. In chapter three, Landes’s opinions are similar to other scholars, like Jared Diamond in Guns, Germs and Steel, claiming that Europe’s political decentralization resulted from geographic barriers like mountain ranges, rivers and large bodies of water. Cities, too, were decentralized, often fortified and competing with other city-states. After the fall of the Western Roman Empire (476 AD), these semi-autonomous cities and kingdoms were a boon to Europe’s overall economic development because they fostered a culture of competition between states and freer, more self-enterprising citizens, compared to the monolithic despots of the East.
Though Landes clarifies that Europe was geographically lucky initially, he explains that more is required to explain its rise over others. Or, framed differently, why non-European states failed to develop themselves. Once far more powerful than any European or Middle Eastern civilization, China did not improve its technology or continue its sea voyages because its leaders simply lacked curiosity (p. 96), Landes claims. He argues that China’s decision in the late 1400s to turn inward and abandon all nautical expeditions was mainly due to its arrogance and Confucianism’s disdain for mercantile interests (p. 97) (a cultural explanation). This is a commonly held view. If the Chinese had not turned inward, they could likely have dominated much of the Indian Ocean and possibly Asia.
India was in a similar predicament. Landes argues that India could have built an impressive empire and be at the vanguard of science and innovation due to its large labour force and access to technologies from Britain, which Indians experienced far earlier than other societies. Yet, Indians failed to develop due to their culture and values (p. 255-230). For example, they resisted adopting technologies like the wheelbarrow and opted to carry hauls atop their heads to spite the British. Moreover, India’s strict division of labour between men, women and the castes made social mobility and the accumulation of knowledge and wealth nearly impossible. Curiously, India had a long history of written languages but failed to adopt widespread literacy.
To summarize, India was not destined to dominate because of its values and culture.; the inability of a person or nation to swallow their pride can be detrimental, it seems. Societies must strive to learn, grow and adopt better practices, even if they’re coming from places they do not appreciate. Do not cut off the nose to spite the face.
How is this book different?
One fascinating feature distinguishing Landes’s explanation of the West’s rise over the rest is his assertion that Europe’s development originates in the Middle (Dark) Ages (p. 45); most scholars say the West’s rise starts at around 1500 AD. (The Middle Ages are the period between the fall of the Western Roman Empire in 476 AD to the Renaissance in approximately 1300 or 1453). He says Europe’s development was because of its Judeo-Christian beliefs and free-enterprising spirit.
Landes cites five technological advancements that improved Europe’s economic output and political power during this period. These include:
the waterwheel, which allowed people, primarily priests, to generate power using a natural resource (p. 45-46).
convex and concave eyeglasses, which allowed crafters to develop detailed and specialized equipment and machinery which led to higher quality control for producing goods (p. 46-47);
mechanical clocks, which were more accurate than Asian water-driven clocks, aiding Europeans’ productivity throughout the day (p. 47-51);
the printing press with moveable type, since it was easier to use and more efficient than the Chinese version (p. 51) (it is worth quickly noting that much of the non-western world rejected or outright banned the printing press, ultimately solidifying their demise);
and gunpowder, which, although invented in China, was first used by Europeans to propel canon and tight pellets for superior firepower and military dominance (p., 52-53);
Another critical aspect of the book’s central argument is that it refutes the notion of Europe’s rise because of slavery and imperialism. The West, Landes claims, would have become wealthy even in the absence of slavery and subjugation of non-European peoples. He acknowledges the accumulated wealth and power from indentured servitude in cotton, sugar, tobacco and other crops but argues that the Industrial Revolution would have happened independently of these events. Slavery and imperialism are not entirely responsible for Europe’s rise because the use of steam, coal and metallurgy were largely independent of the Atlantic slave trade system and the attempt to mechanize the spinning of wool (p. 121). As one can probably imagine, this must upset many apologists and colonial sympathizers.
What is great about the book, and what is lacking?
Landes provides ample evidence proving that culture impacts a nation’s economic development; however, his thesis is not immediately apparent, which makes the book slightly confusing at first. He starts by saying there are both “elements of truth” and “ideological fantasy” about how Europeans “were smarter, better organized, harder working…aggressive, ruthless, greedy, unscrupulous, [and] hypocritical” (p. xxi). Non-Europeans, meanwhile, “were ignorant, arrogant, lazy, backward, superstitious…happy, innocent, [and] weak” (p. xxi). No matter how offensive or self-congratulatory, these adjectives are ambiguous because they are partly true and false. One may add that they are, consequently, unhelpful.
Landes adds two modifying aspects to his thesis about halfway through the book. He says the West rose because of “institutions and culture first; money next; but from the beginning and increasingly, the payoff was to knowledge” (p. 276), suggesting that it was a sequential process to development, stemming from culture. It is not until the end of the book that Landes succinctly claims, “culture makes all the difference” (p. 516) in economic history. He could easily have said this from the start.
Unsurprisingly, critics will accuse the author of Eurocentricity. His bias is evident from his tone and slanted language. For example, when discussing scientific advances, Landes attempts to defend his approach, saying that “non-Western science contribute[d] just about nothing…[and] was incapable of participating” (p. 348). He does not elaborate on any of the contributions from non-Europeans before the Scientific Revolution (roughly around 1543 AD). He also does not make a genuine effort to acknowledge specific scientific and technological advancements from outside Europe or even mention famous non-European scholars, mathematicians and scientists. His bias is also apparent in his choice of vocabulary. For instance, he claims the Slavic lands were not doing well because they were suffering under the Ottomans, “the tyranny of a society more primitive than theirs” (p. 255). No one with common sense and academic integrity can deny that Ottoman culture and institutions were different, and likely worse for science, compared to Eastern European ones, and that occupying colonial forces generally seek to enrich themselves over their subjects. But, as an academic, Landes could not have been less impudent. He has an axe to grind against non-European histories, which will certainly rub some people the wrong way.
However, to his credit and despite his clear bias, Landes admits that Europeans can also demonstrate poor culture and values that retard economic development and stifle science and industry. For instance, he discusses how the Spanish were too arrogant more than once. They viewed themselves at the centre of the universe, and they were uncurious about their European neighbours (p. 312). The Spanish indulged themselves with easy profits from having Indigenous South American slaves mine silver, gold and copper. Additionally, the Spanish relied on foreign credit and manufacturers, ultimately losing out to more technically and financially savvy nations like Britain and the Netherlands. Easy riches backfired, just like when an incompetent, entitled and bratty child inherits their parents’ wealth.
Though cultural values like work ethic, frugality and entrepreneurship may have roots in the Judeo-Christian tradition, it is wise to remain skeptical. Was it the Judeo-Christian tradition that led to scientific inquiry and capitalism, growth and modern development? Instead, it would be unsurprising if Western Europe’s rise was due to the iconoclast reaction against the church and its influence in politics, science, finance, and free inquiry. After all, the church did not appreciate the printing press or any form of opposition, even if churches historically doubled as schools (which was the same for mosques in the medieval Muslim world).
In Landes’s defence, he admits that non-European societies can also develop the right culture and institutions conducive to development. The evidence for this claim is Japan’s rise and other East Asian countries starting around the 1980s; some might argue that other countries like India, Brazil, Indonesia, and South Africa are heading in similar directions. For this reason, it is worth stressing that critics cannot accuse Landes of being xenophobic, racist or neo-colonial. Any nation can develop so long as they try hard.
Though he provides a compelling case for culture’s importance in economic development, his thesis certainly begs the question: how did the enterprising culture develop in the first place? The question, unfortunately, is never clearly answered in the text. We have seen how European geography played its part in shaping Europe’s free-enterprising spirit initially through its city-states, before the Protestant Reformation. So, are culture and values geographically determined? These questions certainly go beyond the scope of his book and may not be suitable for historians to answer. But it certainly forces one to rethink the uniqueness and the underlying factors of Western values and culture, as they could have developed unconsciously.
Is this book relevant?
This book is relevant for discussing three profound subjects today: Freedom of thought and expression, education policy, and political economic policy.
Freedom of thought and expression
It is undebatable that freedom is a cornerstone to inclusive development, whether it is the freedom of thought, expression, mobility or choice of vocation. Freedom allows people and societies to compete impartially while knowledge and skills compound and evolve. Freedom is crucial to understanding why European culture fostered more significant economic and technological development than other cultures. It is, therefore, no surprise that a society seeking to develop economically must foster an environment rich with criticism and diverse thought, or else stagnate and decline. Spain made the fatal mistake of banning the importation and printing of books deemed suspicious (primarily due to prejudice) in 1559, enforcing thought control over its public and academia (p. 180). The parallels with today are concerning when witnessing the de-platforming and banning of controversial guest speakers or publications that challenge emotionally-backed beliefs, known as “cancel culture.”
In a similar vein, today, there is an erroneous belief that one cannot critique, comment on or analyze a group they do not belong to, an idea that stems from Edward Said’s Orientalism (1978). According to this theory, a non-Indian Canadian is not allowed to have an opinion about Indian society because they are not Indian, for example. Landes argues that this reasoning is “polemical and unscientific” (p. 164), noting how the British in India knew more about their subjects than the subjects themselves (p. 164). The British knew so much because they recorded, researched and wrote extensively about the populations they visited and ruled over for their knowledge and because the subjects were often widely illiterate. Consequently, their meticulous approach to knowledge accumulation allowed the West to cement its power over others further since the elites of the colonized people did not bother to learn and grow from their past mistakes. There is no good reason why an outsider cannot understand more about another group of people. After all, several research techniques enable us to learn more about others when appropriately used, such as surveys, interviews, focus groups, and direct participation. These methods should be common knowledge to university students in the social sciences and arts, given that they must complete research methodology courses. Yet the teachings seem ignored by today’s easily-offended, activist class that is too obsessed with identity politics; they are privileged enough to ignore rigorous scientific standards without facing criticism, it seems.
Education policy
The book is also relevant concerning skills development and education policy. A country’s economic competitiveness is influenced by the knowledge, size and skills of its labour force. Countries with more skilled and knowledgeable labour forces are more politically and economically powerful. But skills and knowledge matter most in technical and scientific pursuits since they allow citizens, corporations and the host governments to remain at the frontier of discoveries that increase productivity and living standards for most people. Landes notes that the British education model emphasized learning by doing, and France’s Ecole Polytechnique focussed on military purposes, like metallurgy and engineering (chapter 18). This approach was necessary since it allowed English and French society to become masters across multiple domains. Eastern Bloc countries, by comparison, foolishly focussed on political and social discourse in universities rather than applied science and technical knowledge (p. 432). In the sixteenth century, the Portuguese took the same approach when students prioritized “grammar, rhetoric, and scholastic argument” (p. 134) rather than focusing on science and medicine. These societies were ultimately left in the dust and forced to import innovative technologies, products and best practices elsewhere.
Today, too few Western students study STEM disciplines compared to their non-Western counterparts. This observation should concern education policymakers, especially in the wake of rising East Asian countries pursuing STEM aggressively, threatening to upend a world order governed chiefly according to the far more equitable and moral western philosophies.
Political economic policy
Finally, this book is relevant because it provides reams of information on what makes countries more competitive and prosperous than others. For today’s interconnected, globalized economy, Landes outlines five fundamental, realistic principles of which to be aware:
gains from trade are unequal because comparative advantage differs between people and societies;
importing and exporting jobs is the same as commodities;
comparative advantage is not static since it changes with new actors and practices;
it helps to attend and respond to markets, and some cultures and populations are better at this than others;
and finally, some people are perfectly content to take and not make, and culture may help keep that in check (p. 522).
Considering the above principles, it is vital for developing societies to understand that, like their East Asian counterparts, they can improve their economic circumstances regardless of their inherited history. As Landes optimistically says: “down is not out” (p. 433).
As for developed societies, they must not become self-indulgent, arrogant or cocky like the Spanish, Portuguese and Chinese of yesteryear, since “no economy is too advanced to be penetrated” (p. 476). We, the West, live this reality, with the global economic output increasingly shared amongst rising countries like China and India.
Who should read this book?
Anyone interested in why some nations rise while others fall or stagnate should read this book. More importantly, (amateur) economists and public policy analysts should read and reread this book to develop a more thorough understanding of comparative advantage and competition between societies throughout history.
This book is handy for qualitative information explaining the differences in wealth between societies. It explores an area that most tend to ignore because of its political incorrectness and difficulty quantifying: culture.
Furthermore, Landes provides unique insight on the idealism of the less fortunate (p. 235), the politics of academia and research (p. 349), state intervention in the economy (p. 520) and subsidies (p. 209), and protectionism (p. 207 and 265-266), to name a but few relevant sub-topics that are important to economics. You will not be disappointed.