Farewell to Alms, pp.112-192

by on August 28, 2007 at 6:07 am in Books | Permalink

Through a series of fascinating discussions, Clark constructs building blocks for his larger argument.  I count several major strands in this section:

1. There is a discussion of "survival of the richest"

2. A discussion of why technical advance was so slow before 1800

3. A discussion of how much institutions matter, and asking why medieval England didn't grow more rapidly.

4. "The emergence of modern man"

These arguments are a bit hard to evaluate, since Clark has not finished presenting them or tied them all together.  I regard each section as pathbreaking, but in terms of reservations, I will present two notes of caution...

1. Exactly which national groups evolved a sufficient love of capitalist ways of life?  Clark’s statistics show that the wealthy had more surviving kids in England, relative to the poor.  Furthermore some numbers suggest that the same was less true in accident-prone primitive societies, where selection is based more on luck and physical force.

Even putting aside the debate on how long evolution requires (who will be the first to mention lactose intolerance and dachsunds in the comments?), does this explain the economic supremacy of England?  Recall that England climbed out of the Malthusian trap but most of the rest of Europe did not.  Was positive selection more pronounced in England than in Italy?  Than in France?  There is no evidence for those propositions, which in any case strike me as unlikely.  Even if one buys into positive selection, we have at most "positive selection for some countries vs. others," not "positive selection elevating England over the rest of Europe and driving an industrial revolution."  Positive selection doesn’t get us very far in explaining the climb out of the Malthusian trap, which was more or less unique to England and the Netherlands. 

Clark mentions in passing that positive selection bred the Chinese to be natural capitalists.  If we accept this portrait, I am now more confused about a) where positive selection operated and where it did not, and b) what was the marginal product of positive selection, vis-a-vis industrialization?  Until the 1980s or so, the Chinese record simply isn’t very good over the last few centuries.

In fairness to Clark we have not yet finished his discussion of these factors.

I’ll also note that I see positive selection in terms of culture, family norms, and peer effects, rather than genes.  Or you might think it is some mix of the two.  If you focus on the biological issues in the comments I think you’re missing the strongest and most general version of the argument.

2. I am not persuaded by Clark’s argument that "institutions do not matter."  True, medieval England had limited government intervention but it did not industrialize or "take off."  Clark’s discussion is right on, and if the English example does not persuade you try medieval Iceland, which was probably even freer.

But my conclusion differs from Clark’s.  I conclude "science is more important for growth than we had thought, and the simple fact of freedom does not itself guarantee much progress for science."  In this view the institutions which support science matter profoundly.  Science, science, science.  I recommend Jack Goldstone’s forthcoming book, much of which focuses on science and engineering culture in early modern England. 

Infrastructure also matters.  In medieval England the state wasn’t strong enough to help establish a large open geographic area for trading.  Early English economies were still local rather than national, and yes economies of scale matter.

That all said, I will accept a reformulated argument: "Institutions matter, but we should not take institutions as exogenous."  On this middle ground just about all of Clark’s substantive contributions will hold up.  So I view him as overstating his case, and taking too big a swing at institutional theories.  This overreaching, however, does not negate his core arguments.  So maybe you disagree with Clark on this point, as I do, but you cannot use it as reason to dismiss his other claims.

By the way, here is Ricardo Hausman on the book.  Here was installment one of this BookForum.

In closing, we can now see that Clark’s core arguments don’t depend on Malthusianism; they require only that economic growth is something very difficult to accomplish, and indeed that is the case.

1 Gregory Clark August 28, 2007 at 8:11 am

Survival of the Richest and the Industrial Revolution

Some of Tyler’s legitimate questions about how this would operate are addressed in chapters 12 and 13. The key idea of the book is that:

(1) All agrarian pre-industrial societies were subject to the same pressures making their cultures more “middle class”
(2) This process advanced more rapidly in England than in Japan or China because of accidents of demography and history (ch. 13)
(3) The Industrial Revolution was more diffuse than is generally thought – it was less abrupt and less English than is generally thought.
(4) Had England not existed some society would have had an Industrial Revolution within a few hundred years of the actual Industrial Revolution.

2 Gregory Clark August 28, 2007 at 9:30 am

On Adam Smith and modern economists

I accept Gavin Kennedy’s comment that it was wrong to attribute to Smith the simplified version of his views that modern economists typically associate with Smith. I was just looking for a convenient shorthand for a set of views. “The Smithian vision” has in some sense become detached from Smith himself.

But on the substance I DO want to claim that Smith and others have a false picture of the past. Economic scholarship about, in particular, medieval England has advanced enormously in the past 50 years, and gives us a very different picture of early societies than was possible in earlier years. Smith could not have understood that there had been NO institutional improvement between 1200 and 1800.

In particular markets were much more developed than Tyler supposes in his critique. Grain markets by 1200-99, for example, seem to have been integrated nationally (see my web page, “Markets and Economic Growth? The Grain Market in Medieval England (2001)).

3 Mark Koyama August 28, 2007 at 9:47 am

I have a few more questions for Greg since I don’t feel that he has addressed one of the point Tyler made. This is why did the break from Malthusianism occur in England rather than elsewhere in Europe? You have provided some evidence why this was less likely to occur in China or Japan. A traditional argument put crudely is that England after 1688 had better ‘incentives’ for growth but you dismiss this. This means that your theory has to provide its own set of arguments for why England and not France, Italy, or the Netherlands

As far as I am aware many of the patterns you detect in England such as lower interest rates were European-wide phenomenon. Does your theory indictate why England was special or do you have make recourse to the conventional arguments about the nature of the state, institutions etc. for that part of your argument?

4 Gregory Clark August 28, 2007 at 10:08 am

Why England?

The book tries to point out that the IR in England was part of a wider European development, and English experience then was not as sharply different as people believe. It argues that there were systematic trends in the way societies were developing, but there were also important idiosyncratic differences in social energy that have persisted to the current day.

The book does firmly reject the idea that English institutions played any role in all this.

5 Kent Guida August 28, 2007 at 10:33 am

Survival of the richest
To me, this is one of Clark’s most startling and important ideas. His evidence seems quite convincing. Can anyone offer a critique or counter-argument?
I appreciate Clark’s spirited defense of his book, always coming back to his central points.
I am also surprised at how much I am enjoying this read — it’s truly a pleasure.

6 Barbar August 28, 2007 at 11:06 am

To me, this is one of Clark’s most startling and important ideas. His evidence seems quite convincing. Can anyone offer a critique or counter-argument?

Sure. Clark shows that the rich reproduce more successfully than the poor.
But what exactly logically follows from that?

7 Gregory Clark August 28, 2007 at 12:10 pm

“Clark shows that the rich reproduce more successfully than the poor.
But what exactly logically follows from that?”

I show also that the sons of rich fathers tended to also be rich. Further the success of the sons was not just a function of their having inherited wealth. They inherited, either by learning or by genetics, economic abilities from their fathers.

I show also that going back to 1250 the children of the rich were taking over the whole of the positions in the society.

Thus the possibility exists that by biological means the culture, and even perhaps the genetics, of English society was changing.

Further characteristics we associate with economic success – patience, abstention from violence, education, hard work – were all changing at the society level.

A lot, potentially, follows from this. It is just a possibility, but an intriguing one.

8 Floccina August 28, 2007 at 2:10 pm

The science of Clark and Sailer is truly dismal science but it is good for us to try and consider it fairly.
Does anyone think that protestant Christianity played a supporting role in progress in England?

9 David R. Henderson August 28, 2007 at 3:45 pm

I have two comments:

1. Although I find persuasive much of what Professor Clark writes, I do note a tendency at times for him to assume the Malthusian trap rather than establish that there is a trap. The most striking example I found of this in today’s pages is his short paragraph just before the middle of p. 124. After having laid out that the birth rates are higher and the death rates are lower for higher income families, he writes:

“Thus there is no sign that even preindustrial England in the period 1600-1800 had escaped the grip of the Malthusian trap. The curves displayed in figure 6.3 imply that any significant increase in average incomes would have led immediately to rapid population growth.”

This second sentence is surely wrong. Those curves on their own don’t imply that at all. Rather, if one assumes that the Malthusian model is correct, one will reach Clark’s conclusion.

2. On p. 152, Professor Clark undercuts his own case on marginal tax rates. He points out, correctly, that the effect of high marginal tax rates on hours worked, as distinct from the effect on hours reported, may well reflect the size of the underground, “off the books” economy. But this has, for the last 25 or so years, been one of the main arguments we “supply-siders” have made. Because the work is off the books, so also the income will be off the books, thus making for lower reported income.

10 Jason Malloy August 28, 2007 at 4:54 pm

Even putting aside the debate on how long evolution requires (who will be the first to mention lactose intolerance and dachsunds in the comments?)…

I should point out this isn’t really subject to much “debate”. It is unnecessary to pick out selected examples from artificial selection or the pop science canon (though as many examples could be selected as you want), since the logic and math of population genetics are conceptually simple and deductively true. Falconer pretty much is the final word.

All you need to know is the parameters: if there is genetic variation for a given trait (as assessed by heritability) and if there is a selection pressure on this trait (as assessed by the rate of differential reproduction/survival across generations), then it is a by definition certainty that you have biological evolution. The extent of that evolution is just a little math. Genetic anthropologist Henry Harpending has already discussed this in the context of Clark’s book:

It shouldn’t be hard to ballpark this stuff. The wealth differential has been found everywhere anyone has looked in pre-demographic transition groups. What he describes in England is the same as what happened in Portugal or Sweden.

For a ballpark, assume time preference has an additive heritability of 25%. Assume that everone with time preference more that 1 sd above the mean of the distribution has double the fitness of everyone else. About 16% of the population then has twice the number of offspring as everyone else on average.

After a generation of reproduction the new mean time preference will be increased by (0.2 * .25) or 5% of a standard deviation. In 20 generations, 500 years, time preference should go up by a full standard deviation.

The best talking sociologist I have ever read is Edward Banfield. He thought that time preference was at the core of class differences. Time preference does also have a very high IQ correlation. (Clark’s token arm waving about IQ in his manuscript does him no credit).


All the traits Clark reviews – violence, literacy, time preference, etc. – are heritable to some degree, so it is a virtual certainty (not just a vague ‘possibility’) that the differential reproduction Clark documents was biologically altering English society during the time period he explores.

I would like to say, in slight disagreement with Dr. Harpending, that I found Dr. Clark’s short argument for greater selection pressures on forager over agrarian intelligence (pp 187-188) a thought-provoking piece of evidence in favor of Jared Diamond’s (oddly politically correct) racial theory.

On the other hand, I too am disappointed that the available evidence on this issue was ignored. The measured intelligence for modern foragers is very low (save the Eskimos and subarctic Indian tribes, who actually are above the world average), and this includes their transculturally adopted children. Starting from that data, it is less convincing that settled societies did not have a unique selection pressure on this trait. It’s possible that forager life skill-sets tapped into more domain-specific cognitive traits [*], while the novel abstract symbolic requirements of arithmetic and written language (and greater “Machiavellian” requirements of dealing with larger conglomerates of people) in settled societies created pressures on more domain general cognitive traits.

[*] For instance Aboriginal Australian and Eskimo populations (adopted, assimilated, and not) do far exceed Europeans and East Asians on certain cognitive test items, such as visual memory.

11 Eric Preston August 28, 2007 at 5:31 pm

The types of evidence Mr. Malloy brings up in the previous comments are exactly what I find wanting in Clark’s book. The presence and heritability of specific personal traits that make one economically successful, and a society more economically productive, is a testable hypothesis. It seems more central to Clark’s main thesis than much of the economic data in the book. Of course, I haven’t read much further ahead yet.

12 Bill Stepp August 28, 2007 at 6:22 pm

A couple of empirical questions. In a book about “A Brief Economic History of the World,” there is almost no discussion of the Americas, no discussion of 1492, and none about the “American Holocaust” thesis. Yes Easter Island, Hawaii, and Arctic Canada are mentioned (p. 143).
Also, there seems to be no discussion of hydraulic society in Asia or oriental despotism.
Could the hydraulic engineering involved in large scale infrastructure projects in China have led to Chinese technological sophistication before 1400?

13 Randall Parker August 28, 2007 at 9:51 pm

We don’t just have genetics versus teachings, status, and capital as factors influencing how parents can give children an advantage. There’s another effect that I haven’t seen mentioned here: biological non-genetic influences.

In particular, food is the biggest biological factor aside from genetics. Upper class kids of Medieval parents would have gotten more and better food. Therefore their immune systems would have been stronger and they wouldn’t have suffered as much damage to brain and body due to diseases. Plus, the rich kids were better housed and clothed. Also, better nutrition would have enabled their brains to more fully develop as compared to poor kids. So even given identical genetic variations for IQ as poor people (and I’m not saying the rich and poor had the same distributions of alleles for IQ) the rich kids would have been smarter.

Today in industrialized countries the difference between potential and realized intelligence is much smaller than it was 500 years ago. So if a selective pressure works on intelligence today more of that selective pressure acts on alleles and less of social factors.

Having said all this, of course selective pressures have been acting on human populations over the last couple of thousand years. The evidence for this keeps piling up. See, for example, the Plos Biology paper A Map of Recent Positive Selection in the Human Genome.

Recent articles have proposed that genes involved in brain development and function may have been important targets of selection in recent human evolution [8,9]. While we do not find evidence for selection in the two genes reported in those studies (MCPH1 and ASPM), we do find signals in two other microcephaly genes, namely, CDK5RAP2 in Yoruba, and CENPJ in Europeans and East Asians [46]. Though there is not an overall enrichment for neurological genes in our gene ontology analysis, several other important brain genes also have signals of selection, including the primary inhibitory neurotransmitter GABRA4, an Alzheimer’s susceptibility gene PSEN1, and SYT1 in Yoruba; the serotonin transporter SLC6A4 in Europeans and East Asians; and the dystrophin binding gene SNTG1 in all populations.

Several other biological processes that have not previously been proposed as targets of selection also show an enrichment for signals of selection. For example, the category of electron transport genes is significant in Europeans, due in large part to selection in CYP genes. CYP genes are mainly expressed in the liver and catalyze many reactions involved in breaking down foreign compounds, including the majority of pharmaceutical agents. Genes in this class with evidence for selection include four genes in the CYP450 gene cluster on Chromosome 1p33, as well as CYP genes in other genomic locations including CYP3A5, CYP2E1, and CYP1A2. Another category showing enrichment of selection signals is phosphate metabolism in East Asians and Europeans. Genes in the phosphatidylinositol pathway seem to be particularly overrepresented among the significant genes in this category, including INPP5E, PI4K2B, IHPK1, IHPK2, IHPK3 in East Asians and IMPA2 and SYNJ1 in Europeans.

Note how all these selective pressures were causing the various human populations to genetically diverge.

Any alleles possessed in greater frequency by by wealthier people were selected for before the IR. I think it likely that greater reproductive fitness of the wealthy created selective pressure for IQ and probably for other traits as well.

14 michael vassar August 28, 2007 at 11:47 pm

One item that Adam Smith emphasized leading to capitalism was the development of secure property for the non-influential in combination with luxury markets. New luxury goods incrementally impoverished the non-frugal rich from the late middle ages on. Transport of such goods created new economic elites who didn’t need to expend much of their wealth to avoid confiscation. Finally, the opportunity to become wealthy and the opportunity to improve ones standard of living via luxury consumption created means and motive to become wealthier. Without luxury goods there is little motive to become wealthy.

15 JSK August 29, 2007 at 3:34 am

How about island Japan with for the most part a subtropical climate?

16 Gavin Kennedy August 29, 2007 at 9:17 am

I have not yet got to Greg Clark’s presentation of his central thesis that selection pressure caused a cultural or genetically transmitted change on humans living in ‘England’ (I presume he means what we Scots call ‘Britain’) so that from 1800 onwards economic development promoted what some historians, but by no means all, call the ‘industrial revolution’, a vague designation for forty to sixty years development of power-driven machinery that enabled the commercial economy to become a capitalist economy and mobilised the people who made this possible.

So far, I have read to page 189, from strictly following Tyler Cowen’s ‘rules’ for participating in the on-line debate on Marginal Revolution.

The most salient feature is Greg Clark’s statistical evidence that shows that people in the 1800 were no better of in subsistence (mainly calorie) levels than their foreparents were 10,000 years ago. More specifically and problematically, Greg Clark asserts that there were no ‘institutional changes’ changes from 1250 to 1800. Perhaps Greg elaborates ahead on what he means by this?

Running through the book so far, there is an implied, occasionally specific, idea that the ‘Washington Concensus’ in the World Bank and IMF have got the wrong concepts of development. This is bound up with a critique of neoclassical economists, wrapped together, misleadingly, with Adam Smith and Wealth Of Nations. I have challenged Gregory Clark on this last assertion that Adam Smith’s ideas have anything to do with neoclassical economics or with their development nostrums for the World Bank and IMF. To his credit he accepts that point but he does not withdraw it on the grounds that ‘Smithian economics’ is now bound up with the neoclassical attribution, somehow making his own attribution acceptable if not correct! I am disappointed at his stance on this point.

Let me take up some general points to see if we have consensus.

That subsistence standards did not rise, and may have regularly fallen, in the period covered (whether from 10,000 years ago or from 1250) is not challenged. It was a necessary consequence of what Greg calls the ‘Malthusian Trap’. If subsistence rose, more children would survive and per capita subsistence would fall back to where its ‘normal’ level. True. For the overwhelming bulk of the people. Forager societies were stable for thousands of years because they did not (could not) save surplus sustenance much above subsistence (no refrigerators). Foragers continued, and continue, to survive as small bands spread across the world (to mid-18th century, known and unknown).

But in agriculture (another so-called ‘revolution’, this time lasting thousands of years), a surplus could be stored (herds, flocks, seedstock and feedstock) ‘owned’ as property by rich elites, who used the surpluses to mobilise armed force and found civilisations, the dertritus of which abounds in the northern hemisphere of Europe, the near East and India and China. These civilisaitons came and went. The serfs, armed retainers and slaves remained and survived on ‘normal’ subsistence throughout.

With the appearance of settlements, from groups of hovels to brickbuilt towns, later cities, the age of commerce (‘at last’, wrote Adam Smith) emerged, with trade between town and country, long distance trade and conquest among territories. The average intake of subsistence for the mass of people hardly changed because though output grew, so did population. But the scale of the ‘magnificance’ of the stone monuments, artifacts and such like continued for thousands of years too, having no effect on the subsistence statistics, as shown in Greg Clark’s data.

He measures one important criterion of consumption, but it does not measure ‘progress’ either materially in cities, power and technology under the control of the elites, or intellectually in myth, superstition, beliefs in ‘invisible gods’, mathematics, science, knowledge, and literature, art and ‘dance’. All of it socially transmittable across space and time. I do not know about genetically.

Adam Smith’s (NOT neoclassical) growth ‘model’ (more a ‘process’) attempted to capture necessary changes brought about by traded exchange of produced goods, inclusive of annual surplus (net profits). Capital in foraging was of the ‘grub-stake’ kind – for a few days while hunting. Capital in agriculture and shepherding could sustain people between seasons, and on war campaigns
between sowing and harvests. Capital in commerce, through invented mediums of money, and accounting, within price systems, could be used to put materials and new employment together in ‘wheels of circulation’ that caused ‘perpetual’ growth trajectories, perfectly consistent with level subsistence standards over many generations, indeed over millennia.

Smith wrote of the institutional environment (a preferable but NEVER a sufficient condition) that would accumulate social contributions into higher growth rates. He did NOT describe these social conditions as pre-conditions of development or growth. Minute compound growth rates (well below 1 per cent) would have long term, slow and gradual effects, without necessarily affecting mass per capita subsistence levels. Indeed, he viewed the fall of Rome and the destruction of the commercial society in a thousand year period, from 476 BC to the 15th century, as the prelude to a commercial revival that by the 18th century was manifest in Britain and parts of Western Europe. Wealth Of Nations (is NOT an economics textbook) is about these processes. It should be read along with his Lectures On Jurisprudence.

So far, I have seen nothing in ‘Farewell to Alms’, excellent as it is and great to read, that endorses his assertion that Adam Smith (from Kirkcaldy, not Chicago) is far in his thinking from Greg’s history account. I cannot say the same thing for the neoclassical consensus. On this point Gregory and I may find agreement.

17 Steve Sailer August 29, 2007 at 3:23 pm

In his “History of England,” Thomas Babington Macaulay pointed to 1688 as the date from which sophisticated corporate business and financial arrangements exploded in England. After 1688 there was a “settled distribution of property,” so the Protestant grandees were assured that their lands, which Henry VII had stolen from the Church and given to the ancestors in the 1530s, could never be stolen back by a Catholic monarch. This security of collateral encouraged the popularity of modern financial instruments.

18 Steve Sailer August 29, 2007 at 4:33 pm

There’s some general evidence that skulls have gotten thinner over the last 10,000 or so years, suggesting that people have gotten more peaceful in their normal lives so that getting whomped on the noggin isn’t a regular part of your daily routine, so you don’t need as thick a skull today as in the past. See the NYT’s genetics correspondent Nicholas Wade’s 2006 book “Before the Dawn.”

Thinner skull bones would leave more room for brains.

19 Rue Des Quatre Vents September 1, 2007 at 8:07 am

A little late into this debate, but did anyone notice this inconsistency in this section of the book? The inconsistency is the following: Clark’s argument about demographic change depends (mostly?) partly on the point that the rich left more capital and a more industrious disposition in their offspring than the poor; and that the rich simply had more offspring than the poor. These changes in demographic, he says, led to downward mobility for the scions of wealth, filling in the places left by the less industrious poor.

And yet here is the contradiction: in his chapter on why institutions do not matter, Clark compares modern economies with pre-industrial england and finds that they largely have the same freedoms and institutions in place. One such institution, he claims, is social mobility. And here, he emphatically says this is upward mobility.

So question: whence the two kinds of mobility? How could there be downward mobility and upward mobility?

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