British education, not British institutions, has driven British economic growth

by on August 31, 2017 at 2:12 am in Economics, Education, History | Permalink

Jakob B. Madsen and Fabrice Murtin have a newly published paper on this topic:

This paper constructs an original database on physical capital, labor, education, GDP, innovations, technology spillovers, and institutions to analyze the proximate determinants of British economic growth since 1270. Several approaches are taken in the paper to tackle endogeneity. We show that education has been the most important driver of income growth during the period 1270–2010, followed by knowledge stock and fixed capital, while institutions have not been robust determinants of growth. The contribution of education has been equally important before and after the first Industrial Revolution. Overall, the results give strong support to the predictions of Unified Growth Theories.

I would note two things.  First, the growth equations do at some points rely on long and (possibly arbitrary?) lags.  Second, often literacy is proxying for education, so this is more a paper about the origins of growth and the role of science, and less a study of whether formal education is about signaling or actual learning.

For the pointer I thank the excellent Kevin Lewis.

1 prior_test3 August 31, 2017 at 2:27 am

So, does the Royal Navy count as an educational institution, or merely an institutional one?

Because one can assume that once Britannia ruled the waves (starting after this unpleasantness was resolved – https://en.wikipedia.org/wiki/Anglo-Dutch_Wars ), growth was assured for what became the world’s largest empire.

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2 Axa August 31, 2017 at 3:25 am

“The Dutch merchant elite began to use London as a new operational base and Dutch economic growth slowed. From about 1720 Dutch wealth ceased to grow at all; around 1780 the per capita gross national product of the Kingdom of Great Britain surpassed that of the Dutch.”

mmmmmm, trade is important

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3 prior_test3 August 31, 2017 at 4:53 am

As was access to the English Channel for a nation famed for trading spices.

The Dutch case is a bit special, though – after all, it was a Dutch Stadtholder that became William III of England. https://en.wikipedia.org/wiki/Glorious_Revolution

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4 Alistair August 31, 2017 at 5:19 am

Yes, the Dutch weren’t generally an antagonistic power to Britain over the longer period and the Dutch wars seem a bit of an exception. There was a very considerable London-Amsterdam merchant axis. It seems the Dutch kinda lost their way (OK, they had a rough 18th century) and Britain was well positioned to pick up the slack.

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5 M August 31, 2017 at 3:39 pm

Correlation, not causation. International trade too low as % of GDP to drive growth in gdp/cap (esp. significant growth of industrial revolution).

British GDP does not rise relative to Dutch through 18th century, and converges to it’s 18th century relative to Dutch on a smooth trend through mid 16th century – http://3.bp.blogspot.com/-6UI2NjCWn04/UqxSEjJCzmI/AAAAAAAACIs/Alm85RVkdoc/s1600/Great+Divergence.png. No sign of a decisive impact of the Glorious Revolution and end of Anglo-Dutch wars. Dutch GDP/cap does not grow between 1600-1800.

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6 cjcjc August 31, 2017 at 2:59 am

At what point does “education” become an “institution”, especially after the introduction of compulsory education towards the end of the 19th century?

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7 NPW August 31, 2017 at 8:10 am

This

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8 M. Klaus August 31, 2017 at 4:02 am

1270-2010? This file should be under “speculation” no?

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9 bmcburney August 31, 2017 at 7:16 am

Exactly. An original database “on physical capital, labor, education, GDP, innovations, technology spillovers, and institutions” which can “analyze the proximate determinants of British growth since 1270”?

Wouldn’t it be easier to just construct a time machine?

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10 bmcburney August 31, 2017 at 9:36 am

I’ve got it. We invent a time machine, depose Richard II (bound to happen anyway), make a series of discrete public policy changes and carefully record the outcomes to 2010. Then go back in time again, depose Richard II again, institute a somewhat different set of public policy changes, record those outcomes and repeat the process until the right policy mix is empirically established. Then we take our data back to the moment just before we invented the time machine and prevent us from inventing it (keeps anybody from messing with our data). Input the data and, voila, we have an original database on physical capital, labor, education, GDP, innovations, technology spillovers, and institutions which we can use to analyze the proximate determinants of British growth since 1400.

There is a line between “alt-history” novels and published macro research but it seems to be a thin one.

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11 Alistair August 31, 2017 at 5:29 am

Perhaps unfortunately, “education” is too narrow/loaded a term here. Certainly it can’t be construed as formal modern education. The period covers a huge growth in general “education” from apprenticeships, guilds, formal and charitable institutions, friendly societies, books, and general literacy. Formal education is just the last 150 years or so, and most of that is primary/secondary level.

Meanwhile, the value of modern non-STEM degrees outside the Russell Group is heading for the toilet. Based on Sutton trust analysis, it’s clear that the last 20 years expansion of British higher education has not been cost-effective. If you’re a mediocre student you are much better off going straight into work than wasting 3 years and spending £50k to get a 2:1 in Psychology and Media Studies from the University of East Bogstandard.

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12 Just Another MR Commentor August 31, 2017 at 5:44 am

STEM degrees from non-elite schools meanwhile are already past the toilet and have been flushed into the main sewer line.

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13 Art Deco August 31, 2017 at 8:57 am

Sorry you’ve failed in your professional life. Can you be quieter about it?

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14 Art Deco August 31, 2017 at 9:01 am

If you’re a mediocre student you are much better off going straight into work than wasting 3 years and spending £50k to get a 2:1 in Psychology and Media Studies from the University of East Bogstandard.

Cut the time incorporated degree and certificate programs and route people toward vocational courses of study. Over on this side of the pond, the troublesome institution is the baccalaureate degree, a hodgepodge it takes 120 weeks of study to complete. Secondary education also incorporates a great deal of frittering.

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15 Alistair September 1, 2017 at 8:51 am

Yes, exactly.

The one bright spot over in the UK is that modern apprenticeships and vocational training have been growing successfully alongside the degree schemes. These tend to show much, much better returns on investment for participants.

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16 Alistair August 31, 2017 at 5:30 am

Perhaps “human capital” would be a better term than education?

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17 dearieme August 31, 2017 at 5:49 am

Our education system produces the world’s finest cucks.

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18 dearieme August 31, 2017 at 8:30 am

You’re certainly an authority on cuckhood, you feeble fraud.

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19 dearieme August 31, 2017 at 11:08 am

Because I’m British so of course I’m a cuckxpert.

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20 Art Deco August 31, 2017 at 11:18 am

Hold your horses not so fast
the British are the cucks of the past

In the 21st century no one will chuck
The true blue American cuck

Like meeeeeeee…

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21 dearieme August 31, 2017 at 11:37 am

From revolutions Glorious to Marginal the British cuck is notorious
the source of studies anthropological

The sun never sets on the blue white and red.
The sun never sets with us in our wives beds!

22 Art Deco and dearieme August 31, 2017 at 11:43 am

We’re just two cucks who make comments on the int-ter-net
We like to make it seem like we’ve got it all set
But instead we’ve got blackmen in our bed and no dicks
So our cuck comments is all we have for tricks

23 prior_test3 August 31, 2017 at 11:51 am

+1

24 msgkings August 31, 2017 at 1:13 pm

I just can’t stop my sad, pathetic internet stalking

25 msgkings August 31, 2017 at 2:23 pm

It’s not me, Art, you look stupid every time you make this mistake. Also, you encourage the idiot doing it.

26 Art Deco August 31, 2017 at 2:43 pm

It’s too bad I’m just an obsessive old women who spends her days stalking Art Deco online.

27 Thanatos Savehn August 31, 2017 at 7:58 am

First, upon looking through Kevin Lewis’ collection of abstracts it becomes clear that he’s simply a curator of fashionable B.S. None of the abstracts (at least through the first three pages) represent hypothetico-deductive research. About half appear to be of the Naomi Oreskes cherry-pick-some-contextless-quotes-and-rearrange-them-to-fit-my-narrative variety and the rest are of the let’s-do-a-metaanalysis-of-a-severely-polluted-nonempirical-and-heavily-biased-literature-to-reconfirm-my-biases variety.

Second, (or maybe it’s really more of the first) what is the essence of this “education” variable that remained constant over 800+ years? It appears to be undefined. Does it mean something like this: http://www.kings.lincs.sch.uk/page/?pid=9 ? Or this: http://www.wellesley.edu/wgst ? The former sort of education I’d wager does drive growth whereas the latter drives stagnation (unless the manufacture of expensively over-educated idiots serves some purpose other than providing jobs for expensively over-educated idiot/cynical professors).

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28 peri August 31, 2017 at 9:19 am

This one was rough going for me:

“We test the idea that when vivid news accounts of human suffering are broadcast in the background but ignored, people infer from their choice to ignore these accounts that they care less about the issue, compared to those who pay attention and even to those who were not exposed. ”

http://www.nationalaffairs.com/blog/detail/findings-a-daily-roundup/what-a-shame

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29 dearieme August 31, 2017 at 8:31 am

“often literacy is proxying for education”: wot abaht the Reformation, then? A sudden acceleration of growth? Weber was right?

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30 Art Deco August 31, 2017 at 8:55 am

Cue Mandy Rice-Davies.

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31 peri August 31, 2017 at 9:11 am

I have the impression that during the time of fantastic scientific and industrial achievement in the 19th century, the British public school system was mostly innocent of science.

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32 Art Deco August 31, 2017 at 1:26 pm

Do you mean ‘public school’ as in Eton and Harrow, or do you mean state schools? I don’t think you had state provision of elementary schooling in Britain until about 1870.

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33 peri August 31, 2017 at 2:55 pm

Oh, I meant what we would call private boarding schools.

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34 peri August 31, 2017 at 2:56 pm

System was the wrong word.

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35 Alistair September 1, 2017 at 8:55 am

At university level, true for Oxford and Cambridge, but much better in the “engineering” courses developing in the new urban universities of the time.

Below uni level, public schools varied a lot. Many taught science and engineering, though there was perhaps too much emphasis on maths and languages.

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36 peri September 1, 2017 at 12:47 pm

“At St Paul’s School we teach nothing but the classics, nothing but Latin and Greek,” John Sleath, high master of St Paul’s School from 1814 to 1837, told parents. “If you want your boy to learn anything else you must have him taught at home, and for that purpose we give him three half-holidays a week.”

“Members of the elite also worried that the education their children were receiving was irrelevant. Baden Powell, an Oxford professor (and father of Scouting pioneer Robert Baden-Powell), said in 1832: “Scientific knowledge is rapidly spreading among all classes except the higher, and the consequence must be, that that class will not long remain the higher.”

http://www.historyextra.com/article/premium/schools-hard-knocks

It sounds like they were bent on reform earlier than I imagined.

I’m reading a biography of Anthony Blunt, “Old Marlburian.” Much – some would say overmuch – emphasis on the aesthetic side of things as late as nineteen-teens, though of course he thought he was surrounded by Philistines.

Mind, I have no opinion one way or another – I find the most enraging reply, when something is under discussion, is, “Well, that’s a matter of aesthetics.” Case closed. What do any of us know of aesthetics at this point?

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37 Anonymous August 31, 2017 at 10:50 am

Tech?

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38 James Anderson September 2, 2017 at 2:58 pm

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