Bourgeois Dignity: Why Economics Can't Explain the Modern World

by Deirdre Nansen McCloskey

The big economic story of our times is not the Great Recession. It is how China and India began to embrace neoliberal ideas of economics and attributed a sense of dignity and liberty to the bourgeoisie they had denied for so long. The result was an explosion in economic growth and proof that economic change depends less on foreign trade, investment, or material causes, and a whole lot more on ideas and what people believe.

Or so says Deirdre N. McCloskey in Bourgeois Dignity, a fiercely contrarian history that wages a similar argument about economics in the West. Here she turns her attention to seventeenth- and eighteenth-century Europe to reconsider the birth of the industrial revolution and the rise of capitalism. According to McCloskey, our modern world was not the product of new markets and innovations, but rather the result of shifting opinions about them. During this time, talk of private property, commerce, and even the bourgeoisie itself radically altered, becoming far more approving and flying in the face of prejudices several millennia old. The wealth of nations, then, didn’t grow so dramatically because of economic factors: it grew because rhetoric about markets and free enterprise finally became enthusiastic and encouraging of their inherent dignity.

An utterly fascinating sequel to her critically acclaimed book The Bourgeois Virtues, Bourgeois Dignity is a feast of intellectual riches from one of our most spirited and ambitious historians—a work that will forever change our understanding of how the power of persuasion shapes our economic lives.

Genres: Economics, History, Nonfiction, Politics, Cultural, Business, Philosophy

592 pages, Hardcover

First published October 4, 2010

About the author

Deirdre Nansen McCloskey has been distinguished professor of economics and history and professor of English and communications at the University of Illinois at Chicago. She is the author of numerous books, including Bourgeois Equality: How Ideas, Not Capital or Institutions, Enriched the World.

Reviews

[Buck · Rating 2 out of 5]

My ancestors were illiterate peasants living in their own filth. But that’s okay – so were yours, and you probably don’t have to go back very far to find them (mine crawled out of the rural idiocy of the Scottish Highlands a mere six or seven generations ago). Unless you happen to be reading this in, say, sub-Saharan Africa, you are enormously, fantastically richer than your great-great-grandparents ever dreamed of being. Even if your Visa card is maxed out and your ’92 Honda Accord is emitting its death rattle, you’re immeasurably better off than your forebears. Why? Among other reasons: because you can read and write; because you aren’t going to die of starvation or malaria or while giving birth to your tenth underweight child; because you have a cell phone in your pocket and Skechers on your feet and, just maybe, in spite of your “poverty”, a 36-inch Sony flat screen in your living room.

This is what Deirdre McCloskey calls the “Great Fact” or simply the “Fact”: i.e. that almost all of us, pretty much across the board, have gotten filthy rich in the last two-hundred years. Since 1800 or so, incomes in the developed world have increased by something like 1500%. Probably much more, in fact, if we could measure the real value of things like Internet access and air conditioning. And contrary to what Michael Moore may have told you, it’s not just those cigar-chomping plutocrats who’ve benefited. Everybody else has made out alright, too. Whereas the poor of two hundred years ago were sometimes reduced to eating grass, the poor of today are reduced to eating KFC Double Downs: a culinary disaster, if you like, but an economic miracle.

To hear McCloskey tell it, no reputable economist disputes the Fact, not even the odd Marxist who’s still skulking around Berkeley. The question is: why? Why did incomes suddenly start shooting up 200 years ago, first in Britain and Holland, then in New England and France, and finally across much of the world? This, apparently, is one of the great white whales of economic history: everybody from Karl Marx to Karl Polanyi has tried to harpoon the sucker. In Bourgeois Dignity, McCloskey examines each theory in turn and patiently explains why it’s total, irredeemable bullshit; then she peddles her own theory. Basically, she says the bourgeoisie did it – or more accurately, a liberated bourgeoisie that was finally empowered to let loose its innovations and creative destruction on the world.

Now, being a largely innumerate English major, I have to take McCloskey’s statistics on faith, but my mushy, liberal-arts-fed brain tells me there’s something to this idea of hers. And then, being an aspiring member of what Keynes used to call the “educated bourgeoisie,” I’m flattered by it. It appeals to my class pride. We created modernity. Fuck, yeah.

I wish I could recommend Bourgeois Dignity to the many Naomi Klein fans I know, just as a neoliberal counterweight. Unfortunately, this isn’t the book that’s finally going to persuade them to get off the bong and go start an IT company. It could have been that book, if it didn’t suffer from some weird chemical imbalance that makes it alternately brilliant and tedious, insightful and repetitive, like that under-medicated guy at the donut shop ranting about the Arian heresy. The cliché that socialism looks great on paper but falls down in practice can be inverted with neoliberalism: it works okay in practice (except when it doesn't), but the theory is homely as all get-out. Meaning, it's prosaic and flawed, but fundamentally right. The way I see it—and I'm comparing great things with small here—is that 20th-century humanity found itself in roughly the same position as Eric Stoltz in Some Kind of Wonderful: faced with two very different visions of the future, we chose the Mary Stuart Masterson of capitalist democracy, which was the right call, but we're collectively haunted by an inner voice that says, "Man, you totally could have banged Lea Thompson." I'd still like to think there's a Molly Ringwald of radical centrism out there somewhere, but that's a whole different movie.

[Kevin Carson · Rating 2 out of 5]

The book's line of inquiry is into the causes of what she calls "the Fact" -- the tenfold or more increase in the average person's standard of living in a couple centuries' time.
Her actual argumentation is a mess. What she's actually engaged in an apologetic *for* seems to be an unstable amalgamation of everything she has an aesthetic affinity for, and varies from place to place in the book. But for the most part the view of the world she's advancing is roughly that of Postrel's Enemies of the Future, but with more footnotes.

Her thesis that "the Fact" owed its origins to a culture of innovation, of openness to experimentation and tinkering, and respect for productive labor, is -- to be fair -- quite persuasive. The problem lies with the rather incoherent way she groups all the things together that she identifies with this culture, and the assortment of things she considers inimical to it.

For example she conflates an amazing list of things in the post-1848 "elite" opinion that shifted against innovation and technological progress, "in nationalism and then in socialism, and then in national socialism, and finally in environmentalism..." And this amalgamated body of "elite" opinion, aka "things I don't like," was characterized by this rigorously defined list of traits: "stubbornly anti-capitalist, protectionist, anti-technological, allied with anti-Americanism." Her concept of what constitutes "elites," incidentally, seems to contain no small amount of Babbitry, roughly coinciding with the Republican Party's understanding of "coastal elites" as people with snotty cultural attitudes -- as opposed to regular fellows who don't know what fork to use, despite being billionaires, CEOs and the like who have (you know) actual wealth and power. She literally presents the Readers Digest as the embodiment of "non-elite" -- and hence "anti-socialist" -- opinion. The "bourgeoisie" is by definition non-elite, even when its wealth is measured in billions and the number of people who own most of the world is numbered in hundreds, whereas the elite consists entirely of intellectual lotus-eaters like Carlyle.

At the outset she notes that she's not defending markets as such, or capitalism as such, but bourgeois values centered on innovation, dynamism, entrepreneurship, etc. It is these ideas, she says, and the forward-thinking attitudes they reflect -- not material factors like accumulation -- that are responsible for the Fact. Material factors can explain second-order phenomena like why the benefits of growth from the Fact are distributed among members of a given society, or why the advance in average material standard of living was a bit faster here and a bit slower there. But the Fact, as such, results from cultural attitudes toward entrepreneurship and innovation.

But it's not clear who she thinks she's arguing against in promoting this thesis, other than perhaps John Zerzan or some Deep Green types. Marx was second to none in celebrating the unprecedented forces of production unleashed by industrial capitalism in its "scarce hundred years" of existence, and socialists in general are quite willing to admit the astonishing, unprecedented rate of technological progress and productivity growth in the modern era. They simply argue that capitalism distributed the gains in a very unequal way, and that increasingly irrational social relations of production are impeding further such growth. And -- getting back to the material factors she acknowledges affecting the actual distribution of gains -- it's simply indisputable that assorted forms of artificial property rights and rent extraction have shifted the bulk of the material gains to the upper stratum of society.

She also denies that primitive accumulation (in the Marxian sense) was responsible for the Fact, but that's sort of talking past the bulk of radical historiography. The latter emphasizes the significance of Enclosure &c in establishing the wage system and facilitating the extraction of surplus value, not in facilitating the takeoff as such. And primitive accumulation played a huge role in creating the structural power differentials and inequality of bargaining power that determined how the fruits of increased productivity were distributed. The latter association would be a much more important thing to disprove, for capitalist apologetic purposes.

I will readily admit, and cheerfully so, that the Marxists are wrong in their degree of emphasis on the scale of capital accumulation as a source of productivity -- an emphasis they share with the Austrians and with mass-production ideologues like Schumpeter and Chandler. Mumford, Kropotkin and Borsodi are IMO much closer to the truth of technological history. Enclosures and other forms of primitive accumulation were far less important as a source of investment capital for the industrial revolution than as a source for the power differentials that enable extraction of a surplus from labor. "[M]odern economic growth did not and does not and cannot depend on the scraps to be gained by stealing from poor people." No; but the distribution of the fruits of economic growth between classes can, did and does depend on the bargaining leverage gained by depriving poor people of direct access to the means of production and subsistence. Primitive accumulation was not the reason for the growth of the pie, but it is very much the reason the rich get such a giant share of the pie.

"Stealing from poor people is not a good business plan." Actually it is. It may not be a good plan for accumulating initial investment capital, but it is an excellent plan for shifting the balance of power in order to steal a major part of the future output of those poor people when you employ them. McCloskey herself at one point argues that human capital is a bigger source of productivity than accumulated investment capital. And the relative bargaining power of workers and employers determines how much of the output generated by that human capital goes to whom. Apparently she is unfamiliar with all the political economists, from Wakefield to Oppenheimer, who have argued that it is much harder to exploit labor when you have to compete with the possibility of self-employment on the land -- or the public polemics and private commentary of the propertied classes of England during the Enclosures, in which they argued that rural laborers would not work for wages as long, as hard, or as cheaply, as desired so long as they had the alternative of subsisting on the commons. The Enclosures may not have been a large source of initial investment capital, but they were vital to creating the defining institutional feature of capitalism: the existence of a propertyless class forced to sell its labor on terms offered by owners of the means of production.

Similarly, she argues that imperalism, slavery, and Apartheid did not benefit the average European, white American, or white South African in the sense of promoting the overall wealth of the country or the rate of growth. But despite her constant -- and irrelevant -- insistence that it didn't benefit imperialist countries "as a whole," she does admit that it benefited a small minority of rich people who directly profited from it. And again, it's the surplus extraction function  (the size of the exploiter's slice) and not the growth function (the size of the pie) that's most relevant to a critical analysis of capitalism, in my opinion. Directly analogous, as an example of failure to understand power issues, is the argument of right-libertarians that racist employers are irrational because they limit their own ability to hire the most productive workers without regard to race -- thus ignoring the role of labor market segmentation in weakening labor solidarity and increasing the ease of exploitation. Such is the argument, over and over, of capitalist commentators who argue that mercantilism, the Corn Laws, slavery, etc., were finally ended because people "understood" better -- and not because they were no longer useful to the minority that had previously benefited from them. In referring to this or that extractive policy as a "failure," without specifying clearly for whom it was a "failure," McCloskey reveals her own failure to grasp class analysis, or what constitutes "success" or "failure" from the perspective of a ruling class.

She argues that the Price Revolution of the Sixteenth Century did not "cause the industrial revolution." But it did shape the subsequent institutional structure of capitalism, and the rate of extraction of surplus labor. Specifically, the commodification of land, the abrogation of communal rights in the open fields and common pasture, the conversion of peasants to tenants at will, and the mass waves of rack-renting and eviction, were central in transforming the peasantry into a landless rural proletariat, and in creating the structure of the wage labor market against which background the industrial revolution took place. So McCloskey's asking the wrong questions.

And McCloskey repeatedly makes it clear that, her disavowals notwithstanding, her enthusiasm is not just for innovativeness as such but for the specific model of "free market capitalism" [sic] that emerged in the early modern West. And the things she sees as impeding the innovation and dynamism she supports amount, quite specifically, to significant deviations from the neoliberal model. Take, for example, her reference to "unhelpful economic policies (such as South-African labor laws based on German models and supported by leftist ideologues and trade unionists eager to give the really poor corrupting handouts to keep them away from the job market)." What inherent connection is there between a culture of innovation, as such, and an institutional framework in which labor is rendered so precarious and powerless as to be forced to enter the job market and accept work on whatever terms are offered by capitalists? Why are "handouts" "corrupting" for labor, when the plutocracy's income comes primarily from economic rents on artificial property rights and artificial scarcities enforced by the state, or from state subsidies? The incentives to productivity would be much greater, arguably, given an institutional and property structure in which income was tied more closely to actual productivity (e.g., an economy of commons-based natural resource governance, free and open-source knowledge, and stakeholder cooperative governance of the firm).

This is the same person who repeatedly stresses the relative unimportance of "institutions" and "incentives" compared to cultural attitudes towards innovation. Apparently that flies out the window when it comes to institutions that increase the precarity of labor and reduce its bargaining power, and face it with the incentive to accept work on whatever terms are offered. And apparently economic security or robust bargaining rights -- let alone actually vesting decisions about product and process innovation in workers rather than shareholders -- are inconsistent with a culture of innovation. Growth may result from technological advance and the culture of innovation that fosters it, but apparently giving a greater degree of control over production to the very people who are most directly familiar with the production process is somehow at odds with such innovation.

She also minimizes the extent to which the "free market" model she celebrates was no such thing, but was imposed by state force. 1619 Project. So she has little in the way of coherent criteria from defining the core features of such economies, directly responsible for the Fact, from the accidental ones. Given her negative views of trade unionism and handouts, presumably she considers the predominance of the wage system and what's euphemistically called "labor mobility" or "labor flexibility" to be among the positives, and essential to some degree to the Fact's occurrence. But in fact these things were brought about through Enclosure, etc.

It's ironic that she points to Soviet planners' treatment of capital inputs as a "free good" as an example of calculational chaos, when capitalism has for centuries pursued a growth model of treating enclosed land and natural resources, and state-subsidized material inputs like transportation and trained labor-power, as artificially cheap and abundant goods. And, on the other hand, following a profit model overwhelmingly focused on economic rents from artificial scarcity of information.

Also ironic is the fact that the closest embodiment of her bourgeois ethos of innovation and the dignity of tinkering in present-day society are the open-source peer-producers and open hardware hackers creating means of production scaled to commons-based direct production for use in the informal and social economy, or even the engineers who actually came up with all the ideas Elon Musk profits from. Likewise the related fact that the most significant form of central planning in the world is that of the large transnational corporation which encloses the productivity of such innovators and tinkerers within its walls of intellectual property so that Elon Musk -- every bit as parasitic as any aristocrat living off the labor of peasants on his estate -- can extract rents.

A good example of her obliviousness: "If you personally wish to grow a little rich, by all means be thrifty, and thereby accumulate for retirement. But a much better bet is to have a good idea and be the first to invest in it." With its assumption that the people who have the ideas that increase productivity are the ones who get rich from them, or that venture capitalists play some indispensable role, this could be a line from a John Stossel or Thomas Sowell column.
1/2

[Frumenty · Rating 5 out of 5]

This is a work of economic history. That's not a topic that I would usually interest myself in, but I heard the author speaking on the radio and I was impressed. The question this book seeks to answer, apparently a perennial one for economic historians, is why did the Industrial Revolution occur when and where it did, and not somewhere else and at another time? The answer, it is asserted, is pretty simple, but all the economists have missed it:

"A big change in the common opinion about markets and innovation, I claim, caused the Industrial Revolution, and then the modern world. The change occurred during the seventeenth and eighteenth centuries in north-western Europe. More or less suddenly the Dutch and British and then the Americans and the French began talking about the middle class, high or low - the 'bourgeoisie' - as though it were dignified and free. The result was modern economic growth." (Preface)

That's it: dignity and liberty for the bourgeoisie caused the Industrial Revolution. Not science and technology, not thrift, not a protestant work ethic, not reform of property law, not racial superiority, not geography and natural resources - but a cultural change, a change of "rhetoric". How do you prove that? Well first you must disprove every other hypothesis that has been proposed, and that is precisely what this book purports to do. This has the potential to be a very onerous read, a systematic response to every imaginable objection; something like The Origin of species, but with lots of abstruse calculations.

To call my understanding of economics "basic" might imply that I understand the rudiments. I would never make such an extravagant claim. I do, however, know enough of Western intellectual history to appreciate the vast scope of McCloskey's knowledge. I was tickled to read, "It is said that John Milton was the last man in Europe who had read 'everything' - well, everything in Western European and certain dead languages." Apparently there remains at least one woman who has read 'everything' - Deidre N. McCloskey - or so I am tempted to believe. This book introduces a galaxy of economists, most of whose names I will never see in print again, and dissects their opinions in concrete terms that I had little difficulty in understanding; though I freely admit that if her intention were to hoodwink me, she could do so and I would have no inkling of it. For my part, her case remains unproven because I simply don't have the economic knowledge to test her good faith; but, given that economists too can read, it is implausible that her arguments are so flimsy that they wouldn't withstand the scrutiny of most of her peers. To those like myself who were schooled in the days when the use of logarithms and slide-rules were taught, McCloskey's critique of other hypotheses will appear familiar: the question she asks, again and again, is whether the answer provided is to scale, and the response is invariably no. No other hypothesis is capable of explaining what she calls "The Great Fact of economic growth", which is to say the growth, not by increments but by multiples (16, 20, 30 times, depending on who is calculating), in real incomes in societies that have embraced "the Bourgeois Revaluation", compounded by exponential improvements in the quality of goods and services (eg. candles vs LED lighting) which may be purchased from those incomes. When the bourgeoisie is honoured and free, there is endemic innovation at every level and that is what causes these stratospheric levels of growth.

There were moments when I thought, why am I reading such dry stuff?; but they were few. For the most part I felt exhilarated by the sheer breadth of McCloskey's reading, the cultural-historical knowledge that she draws upon and puts into the service of her thesis. This book is not for everyone, but if I have succeeded in piquing your interest then you should try it; you may enjoy it.

[Dan Walker · Rating 5 out of 5]

I believe Deirdre McCloskey has unlocked the secret to why we are so wealthy today. Most people, and apparently all politicians, walk around believing there is something fundamentally wrong with the world and that money is a big part of the problem. Somehow things just aren't right and what we really need to do is reshuffle the deck and spread the wealth "fairly." Strangely, "fairness" seems to coincide with helping this or that politician win the next election.

Since most people only live a few decades, we have lost all perspective. And that perspective is that for the vast majority of human history, people have lived on the equivalent of $3 per day, more or less. Only in the last 300 years has that reality fundamentally changed. Answering the question of why that happened is absolutely critical, otherwise we will, in pursuit of "fairness", go back to living on $3 per day, in my opinion.

And the reason why wealth increased so dramatically (conservatively we are 16 times wealthier than our ancestors, but the true number is more like 100 times!) is a matter of fierce debate. One economist who I respect highly is convinced the wealth increase occurred when it did because people didn't get enough nutrition up to that point in human history and simply weren't smart enough to start the Industrial Revolution until about the 1700s!

Ms. McCloskey proposes, however, that the Industrial Revolution occurred when it did because the bourgeois were given dignity and liberty by their government, their society, and most importantly, by their neighbors. Suddenly it was OK to rise above your fellows when it came to making money. The innovation unleashed led directly to the Internet, Amazon Kindle, and iPhones. Thank God.

Despite my summary above, the book is devoted mainly to showing how simplistic and shallow most other arguments are as to why Western Civ is so wealthy today. No, slavery didn't make the US the richest nation on earth. Transportation and coal didn't cause it, nor science, nor free trade, nor rule by law. All of these existed in some form or another in many other places on earth and often for centuries before they existed in Europe. And yet they did not lead to an Industrial Revolution in India, China, Africa, or the Middle East. They cannot be the answer.

If you are reading the book looking for quick answers, just read the intro, the last chapter, and read the chapter titles in the Table of Contents, which neatly form a sentence summarizing the book. Ms. McCloskey writes in a conversational style that can seem winding and slow. Read it as if you are in a conversation and it will go better.

[Sean Rosenthal · Rating 5 out of 5]

Interesting Quotes:

"[T]he modern world arose out of an entirely new 'ideology.' Or, equivalently, it arose out of an entirely new social 'rhetoric'--an older term meaning about the same thing. For example, the word 'honest' in Shakespeare's time, as you can see in dictionaries of Shakespearean English or by searching the texts of the plays, was understood mainly as 'noble' (that is, honorable in an aristocratic way, achieved in battle or at court: 'Honest, honest Iago'). Its rhetoric changed radically in the eighteenth century, coming to mean mainly 'dignified as an ordinary person' and 'truth-telling' (that is, reliable in a bourgeois way, for making deals). In the eight works of Jane Austen written from 1793 to 1816 . . . 'honest' occurs thirty-one times. In six of these thirty-one occasions it means 'upright,' dominantly in the old phrase an 'honest man.' Never is it used in Shakespeare's old sense 'of high social rank, heroic in battle, aristocratic.' Another third of the time it means 'genuine,' as in 'a real, honest, old-fashioned boarding school' (Emma), very far indeed fro 'honest' as 'aristocratic.' In its dominant sense it occurs again a third of the time in the meaning 'sincere,' and in four out of the thirty-one total occurrences in the restricted sense of 'truth-telling.' The 1934 Webster's New International Dictionary labels as archaic 'honest' in sense 1, 'held in honor,' with the example of 'honest' (Chaste), as in the old phrase an 'honest woman' (applied repeatedly to Desdemona in Othello). It labels as obsolete 'honesty' in sense 1a, 'honor.' 'Honest' in the new-dominant sense 2 means, the dictionary declares, fair, upright, truthful 'as, an honest judge or *merchant,* [or an honest] statement' (italics supplied). No talk of aristocrats and honorable war. What is astonishing, and revealing of the Bourgeois Revaluation, is that an identical shift of meaning from an aristocratic to a bourgeois meaning of 'honesty' took place at the same time during the Revaluation in other Germanic and Romance languages of commerce, such as in Dutch eerlich and Italian onesto."

-Dierdre McCloskey, Bourgeois Dignity: Why Economics Can't Explain the Modern World

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"When the Soviet authorities during the 1940s exhibited the 1940 movie of The Grapes of Wrath as evidence of how miserable the poor were in capitalist America, it backfired. What amazed the Soviet audiences was that the Joad family fled starvation *by car.*

-Dierdre McCloskey, Bourgeois Dignity: Why Economics Can't Explain the Modern World

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"Yet, pace Marx, modern economic growth did not and does not and cannot depend on the scraps to be gained by stealing from poor people. It is not a good business plan. It never has been, or else industrialization would have happened when Pharoah stole labor from the Hebrew slaves (though, by the way, recent evidence suggests that the workers making pyramids were hired labor with good working conditions - more very early 'capitalism'). Stealing from poor people, when you think about it, could hardly explain enrichment by a factor of sixteen, not to speak of one hundred. Would you do so well by robbing the homeless people in your neighborhood, or by breaking into the home of the average factory worker? Would grabbing stuff from the poor of the world enrich the average person in the world, including most surprisingly the poor victims themselves, by a factor of ten since 1800? Does it strike you as plausible that British national income depended on stealing from an impoverished India? If so, you will need to explain why real income per head in Britain went up sharply in the decade after Britain 'lost' India, and so too for all the imperial powers after 1945: France, Holland, Belgium, and at length even rapacious, Fascist Portugal."

-Dierdre McCloskey, Bourgeois Dignity: Why Economics Can't Explain the Modern World

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"There is no doubt that education does matter mightily now to Sweden's position position as one of the richest countries in the world. Without a liberalized attitude toward innovation, however, such sophisticates would have worked at keeping their country impoverished. The educated Chinese elite did. The educated Spanish elite did . . .

"The truth remains that education by itself does not yield much . . . Cuba's income per head by 2001, despite all its alleged investment in human capital, was still about what it had been in 1958, while all around it since the Cuban Revolution income per head had almost doubled. In 2009 the country was malnourished. The cousins in Miami, by contrast, whether much educated or not, were doing a lot better, because they lived in a bourgeois society. And they could read what they wanted . . .

"The sociologists Victor Nee and Richard Swedberg, further, note that in recent decades, China, which had ruined its educational system in the Great Leap Forward, has grown vigorously. Russia led the world in education during the Communist period (compare Cuba in medicine), and in some ways still does (the country with the highest percentage of University graduates is still Russia, by a good margin). Yet it is notably lacking in the toleration for bourgeois innovation that China has surprisingly evolved, and has not grown except when oil prices are high. Thus: specialize in table tennis and sending professors to re-education camps, like the Chinese, and prosper. Win chess matches and lead the world in certain fields of mathematics, like the Russians, and stagnate. It appears that education does not suffice. Bourgeois dignity and liberty does, and ends by financing the accumulation of human capital for a massively wider human scope."

-Dierdre McCloskey, Bourgeois Dignity: Why Economics Can't Explain the Modern World

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"[D]ividing up the spoils from efficiency gains . . . was not mainly what made the modern world. The struggle by unions for higher wages and better working conditions has inspired many good songs and many good people . . . But the fight to get a higher share of the pie for union members leaves out nonunion members, who were always a high percentage of the workforce in the United States. If the size of the pie is pretty much fixed - the underlying assumption of classical economics and of union logic - then higher pay for auto workers implies lower pay for auto mechanics, not something to be celebrated in songs by Woody Guthrie and history books by progressive historians. The economist H. Gregg Lewis painstakingly estimated the effect of unions 1967-1979 on wages of their members relative to comparable nonmembers and found it be, as an upper bound, rather small: some 14 percent. My uncle, who was himself a union electrician in Michigan, paid union wages for his employees gladly, he said, because he passed the expense on to the companies and hospitals and school buildings that he wired. Oh, good. But who pays that? Other workers. There's no one else to pay it. As Pogo famously said, 'We has met the enemy, and he is us.'

"And if, as was on the contrary the case, the pie was in fact exploding, then a shift in the size of the slice going to workers as a whole (setting aside that it would in fact go only to the minority of union members) would anyway play a small role in the betterment of even those workers. Workers in the United States and elsewhere grew radically better off from 1800 on, and 1900 on, and even from 1970 on because of the Bourgeois Deal, not because they went down and joined the union. How do I know? Answer: the nonunion people shared nearly equally in the gain, even though they were paying as consumers for the fancier wages for union electricians in Michigan. The maximum of 14 percent of 'concessions' extracted by bargaining or strike doesn't come close to accounting for the great magnitude of rise in the real wage. There's not enough profit - usually 10 or 15 percent of national income - to rise the level of the rest of national income by a factor of even two, that is, 100 percent, much less the factor of eighteen it in fact rose after 1800. Expropriating 15 percent of national income claimed by the wretched profiteers and transferring it to the 85 percent earned by us workers raises our income only 18 percent. That's a long, long way from 1700 percent.

"Nor did the government under the Progressives or the New Dealers or Lyndon Johnson make people rich. One can agree that it is desirable to prevent flammable factories from having locked doors, or that mines should not routinely collapse, or that workers should have leisure, or that wages of people of color and of women should not be subject to sheer discrimination. But a powerful case can be made that such improvements in wages and working conditions came *after* capitalist markets had delivered much of them anyway, voluntarily in competing for labor, not before. Child labor was falling in England long before it was outlawed. And in any event what made people better off was the gigantically larger pie. People earning $80,000 a year to work as police will not accept seventy-hour workweeks and rotten working conditions, and in historical fact they did not, quite independent of the will of legislatures or the bargaining of unions."

-Dierdre McCloskey, Bourgeois Dignity: Why Economics Can't Explain the Modern World

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"Orthodox Christianity differed from Catholic Christianity in only a few minor doctrines (filioque; clerical celibacy), and yet a corner of the Catholic West initiated growth while the Orthodox world stagnated. The case . . . shows the drag from a rhetoric hostile to commercial values, and by contraries the importance of the Bourgeois Revaluation. The sociologist of comparative religion Michael Lessnoff summarizes with approval [Lynn] White's remarks on the matter: 'In Greek Christianity, the influence of classical Greek culture was considerably greater [than in the West], including the philosophers' depreciation of technology, economic activity, and the active life generally. . . . Mechanical clocks, which proliferated in Western churches, were banned from Orthodox ones.' In the West, by contrast, Newtonian Anglicans took the clock as their central theological metaphor, and the pocket watch discovered in a field as their main argument for God's existence."

-Dierdre McCloskey, Bourgeois Dignity: Why Economics Can't Explain the Modern World

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"Naomi Klein's The Shock Doctrine attacks the economic liberalization of Milton Friedman's sort without realizing that it has enriched the poor of the world since it first became influential around 1973 (and in a longer perspective since 1776). A political poster current in 2009 read, 'Milton Friedman, proud father of global misery.' [13] Some misery: income per head in the world and the world's poor increased in real terms from 1973 (when Friedman was sixty-one, and three years from his Nobel Prize) to 1998 (when Friedman was eighty-six years old) by 40 percent. In the countries that followed his philosophy more exactly than the world-as-a-whole, the increase was much larger even than the world's average of 40 percent. In China, for example, much influenced by Friedman's ideas after 1978 (his book of 1962, Capitalism and Freedom, was widely read by Chinese reformers), it was a factor of 3.7, or 270 percent. In Ireland, which dramatically liberalized a la Friedman, it was a factor of 3.2, or 220 percent. My poor Irish sixth cousins were saved by Friedmanian devotion to the market and innovation."

[13]: "I realize you have settled opinions about Friedman because of your deep knowledge of his involvement with the Pinochet regime in Chile, acquired from numerous and irrefutable stories in the Village Voice. But let me try to unsettle your opinions. Friedman in fact, and on libertarian principle, never after his wartime service advised any governments or accepted money from them - including Chile under Pinochet, with which he had in fact slight contact. Friedman refused two honorary degrees from state universities in Chile precisely because he did not want to be associated with a government. I was present at a faculty meeting at the University of Chicago at which Milton singlehandedly killed a proposal for the Department of Economics to get millions of dollars from the Shah of Iran to educate Iranian professors of economics. He stood up and scolded us: 'We can't be associated with a dictator like the Shah.' We were stunned, and ashamed at our impulse to accept, dazzled by dollar signs."

-Dierdre McCloskey, Bourgeois Dignity: Why Economics Can't Explain the Modern World

--------------------------

"[F]or the same reasons I have adduced here for not believing that efficiency gains are the heart of past economic growth, I do not believe that in the immediate future the inefficiencies of a welfare state or of heavily unionized workforces are greatly to be worried - so long as innovation supported by dignity and liberty for the bourgeoisie is not greatly damaged. Harberger Triangles are not the way to great wealth, and consequently the loss of a few of them from economically inefficient arrangements is not greatly to be lamented. That in fact was Harberger's finding, rather contrary to his (and my) ideological predispositions.

-Dierdre McCloskey, Bourgeois Dignity: Why Economics Can't Explain the Modern World

[Otto Lehto · Rating 4 out of 5]

Like a bubble bath in the ambrosia of cultural memory, McCloskey's encyclopaedic (and almost papal encyclical) book, written in a stream of consciousness prose, presents a kaleidoscopic view of economic history. Her central tenet is a marriage of humanistic and economic learning: that ideas and language, not just institutions and material factors, determine the shape of economic growth.

The narrow argument of the book is, one the one hand, as simple as stated above. But, on the other hand, the book is an emotionally resonant rethinking of the story of our modern lives. It is a clarion call for humanistic classical liberalism, not a dry treatise with a narrow scientific agenda. In the end, I remain unsure whether the efflorescent prose helps or hinders the author's case. But it defines it. The style grabs the reader by the collar and awakens him/her out of various dogmatic assumptions that may or may not be mere extrapolations of the prejudices of modernity. And where the style draws the attention, it is the scholarly substance of the book, in so many little streams of cultural knowledge, that finishes the job by dripping wisdom into the third eye of the reader.

The celebration of intellectual diversity and rhetoric ultimately comes at a cost to science. The biggest takeaway of this book must be the synesthetic brilliance of its prose, since the central argument of the book remains suggestive. It may be fatally wrong. This is impossible to tell, since she does not define her terms with sufficient clarity. As a result, the central argument is both appallingly slippery and, perhaps, scientifically irrefutable. She attempts to have her cake and eat it too, by pretending to show a thousand weaknesses in alternative explanations and then filling in the gap, by a dubious process of elimination, with her idealistic causation. It should be obvious what is wrong with this method. A thousand other explanations may do the trick just as well, so why pick this one? Why should we be convinced that ideas suffice as causal explanations? Why should we not develop a multi-causal model where ideas play a significant but minor part? Why, indeed, could we not see rhetorical ideas as mere epiphenomena caused by deeper forces?

There is much that I don't like about the book - its excessive length, its lack of rigour, its inability to systematically develop a coherent argument for more than a few pages at a time - but, all things considered, it contains enough interesting anecdotes, insights, rhetorical flourishes, pieces of historical data, and little touches of humanity that it works as a classical liberal passion project. Its passion pulled my heartstrings a little bit where its rational arguments failed to convince. And since our passions, our hearts, play such a strong force in the appreciation of her rhetorical powers, her case for the power of ideas as the prime mover of history seems all the more plausible!

Whether the celebration of dignity is enough to cause the industrial revolution, I do not know, but it improved my intellectual posture for a week. McCloskey indeed practices what she preachers: the production of ideas, and powerful rhetoric, that can change the world. She already has.

[Alex MacMillan · Rating 5 out of 5]

A brilliantly-written culmination of a lifetime researching and critically thinking about why the Industrial Revolution happened. Information contained in ten-page chapters were superior to entire books or even semester-long college courses. This is a must read for anyone who majored in a liberal arts discipline who wants their perspective about the nature of modernity expanded beyond the constraints in their thinking (absorbed unawares) by socialists, neoliberals, conservatives, economists, scientists, ... and philosophical materialists most of all.

[Chris]

Brilliant and worldview-changing. McCloskey surveys all the leading explanations for the Industrial Revolution (institutions, trade, science...) and finds them wanting. Her preferred answer is a "bourgeois revaluation" that exalted peaceful commerce and innovation as opposed to the old ways of getting honor through war and conquest....

[William Guerrant · Rating 5 out of 5]

Over the last 250 years or so, nearly all of humanity has achieved a standard of living that would have been unimaginable to our ancestors over the previous thousands of years of human existence. After eons in which nearly all humans were desperately poor and struggling to survive, all of a sudden a middle class emerged and we all started getting richer, a process that has accelerated since it began, and that continues today, at an astonishing pace. In 1800 almost everyone in the world lived on the equivalent of $3/day in current money. That has now increased by 16x and in much of the world by far more than that. What happened to cause what Deidre McCloskey calls "The Great Fact"?

As McCloskey convincingly demonstrates, nearly all of the factors upon which economic historians have relied to explain the Great Fact were frequently in place at other times and in other places around the world throughout history. So why then did this great explosion of innovation (we usually call it "capitalism") not occur in those times and places? Why did it not occur until a few hundred years ago and why then in Holland and Great Britain? That is what she explores in this fascinating (and unusual) book.

She declares on page 447, "Economic history faces no more important question than why industrialization and the reduction of mass poverty first started, and especially why it continued." (I once heard Steven Pinker say, "Well, it had to happen somewhere." But that isn't particularly intellectually satisfying.)

McCloskey devotes the great majority of the book to "knocking off contrary hypotheses." Her method of analysis necessarily requires that she survey a vast amount of economic history, which she does provocatively and often brilliantly. But only in the last few chapters does she reach and begin to defend her own theory.

Ultimately McCloskey surveys and rejects all strictly materialist explanations of the Great Fact, in favor of "bourgeois dignity," or more specifically bourgeois dignity and liberty, or what she calls in one place "British bourgeois dignified." It was how people in Holland and Great Britain came to regard markets and innovation, she argues, that "caused the Industrial Revolution, and then the modern world." (Her arguments are conveniently diagrammed and summarized on pages 407-409). Oddly, McCloskey's critique of the materialist explanations is far more robust than her defense of her own, but perhaps that is because this is one of a series of books and full development of her explanation is to be found elsewhere.

There are lots of opportunities for disagreement here, both with McCloskey's arguments and with her manner of making them. She is sometimes unfair to those with whom she disagrees, it seems to me, but her arguments are informative and entertaining nonetheless. The book is a thoroughly enjoyable read.

[Jesse Field · Rating 4 out of 5]

What is "bourgeois dignity?" Oddly enough, you will hardly find much on the topic in this essay by Deirdre McClosky. For despite its wonky disputations with classical economics, Marxist economics and the new institutionalism after Paul Samuelson, McClosky only reaches the productive portion of her thesis in the last three chapters: the language and rhetoric of bourgeois values, especially of dignity and liberty, drove the rapid economic growth of the industrial revolution. She makes it clear enough that being a merchant, and doing deals, needs to be valued for an economy to take off. Fair enough. But what of bourgeois liberty and dignity?

Dignity encourages faith. You are dignified in standing. Hope by contrast is the virtue of forward looking, of having a project. Liberty encourages hope. You are free to venture. The claim is that the dignity to stand in ones place and the liberty to venture made the modern world. Both were new and necessary. My libertarian friends want liberty alone to suffice. But it seems that it did not. Both dignity and liberty were necessary -- though of course the one normally supports the other.

I want to support this thesis, but there is something unsatisfying about the manifestation of dignity. "The big or small entrepreneur," McClosky says, "encouraged by dignity and enabled by liberty, alertly notices an opportunity, and takes it." So if you have entrepreneurs taking opportunities, if you find that people have the courage to make deals, then you can deduce that dignity was a property of those people? That they were dignified in standing? This seems to be the case with China, which McClosky finds to be achieving economic growth in the wake of its experiment with socialism precisely because people were allowed to make deals again:

The special development zone of Shenzhen in mainland China, a suburb of Hong Kong, went from being a small fishing village to an eight-million soul metropolis in two decades. Such a feat required a shift in rhetoric: stop jailing millionaires and start admiring them; stop resisting creative destruction and start speaking well of innovation; stop over-regulating markets and start letting people make deals.

Where can we find evidence of dignity and liberty in Shenzhen during its years of growth? McClosky admits readily enough that data and reasoning to support that there was a change in rhetoric and that it is this change in rhetoric that powers innovation will await her further work. And if she's right, then the student of Chinese rhetoric is given new impetus and new motivation to study, and to study in particular the language of the period since 1978.

This essay, despite its title, was by design chiefly an examination of what "they say," "they" meaning the various materialist theories of the innovations that comprise the Industrial Revolution and its attendant economic growth. Kenneth Pomeranz, for example, has written that lack of cheap coal was a major factor holding China back from the kind of innovation seen in Britain after 1700, a theory that dovetails with work by Robert Allen. But McClosky argues that the logic that scarcity of labor relative to coal as a driver of innovation (to save labor, they used coal to build machines) does not effectively explain the situation because there is always a factor that is scarce and so profit can be made in saving on it. Similarly, historians will often mistake the increase in trade for a historical force, as McClosky finds Peter Perdue doing when he cites Ming and Qing "commercialization." Whenever the costs of making deals can be saved on it, will be; this is not an explanation for economic growth, and especially not the Industrial Revolution. So "materialist methods" do not explain the total, absolute, "innovativeness" of the British as opposed to the Chinese after 1700.

McClosky's trenchant, often snarky takedowns in this book are often delicious. One imagines she is as good at taking as she is at dishing it out, or likely will have to be, since her thesis is hardly clear by the end. But Bourgeois Dignity is certainly a case of the journey being more than worth the destination. McClosky treats us to an incredible array of ideas inside and outside of economics, really lighting the field up for us non-economists, and presumably injecting humaneness where her colleagues (such as Gregory Clark, it seems) risk reducing whole civilizations to the data that can be tabulated about them. For example, bourgeois values are special, even though, she at one point just throws out there, that since ancient times it has been the bourgeois motive to corrupt the government and gain monopoly. Another example: Chinese science was at a higher level than science in the West until the 17th century; this is an achievement of Joseph Needham's research, which I'm delighted to see McClosky has read.

There is a tone and sense to this book that is very reminiscent of Jordan Peterson's writing, which tendentiously snaps back at ideologues ("the clerisy") for its pessimism, its arrogance, its stubborn refusal to acknowledge that bourgeois values like staying alert and making a good deal has proven engine enough to solve most problems, and can solve many more if we stick to them. But some concerns linger to any critical reader finishing this book. Is it really true that the rich generally achieve their wealth by staying more alert to opportunity? I suppose so, if we add the caveat that they take opportunities to corrupt government and build monopolies. And is it the case that the environment can be improved simply allowing dignified entrepreneurs to innovate? (I suppose the emerging case will be: as climate change presents new scarcities, we need bourgeois values all the more to innovate our way through the scarcities. The chief problem, I suppose, is that massive species loss and major damage to oceans and world forests is very sad. Bourgeois values can't fix it, but can maybe lead to a patched-up world like in Blade Runner.) How is the problem of externalities to be gotten over? Is there not a connection between wise regulation and the preservation of dignity and liberty? McClosky hints of proper answers to such questions, but lack of elaboration leaves some sense of many remaining holes in the work. Still, I'm hooked enough to read on.

[Robert · Rating 2 out of 5]

This series presents short condensations of an author's work, then adds commentary by several authors, with responses by the original author. I had read the blurbs on Amazon about her other econ books and was interested in learning more. Now that I've read this ultra short version and the responses, I doubt if I'll read the other books. Her argument is basically that high level abstract ideas precede and are a precondition for socioeconomic change. Scholars of revolutions have pounded on that premise for a couple centuries, with a wide span of opinion still separating them. This brief piece only reinforced the premise that ideas are necessary for change to occur, but it didn't convince me that as urban capitalists gained social prestige, economies grew as because of that. Seems backward to me, and to some of the commenters.

[Peter Spung · Rating 4 out of 5]

Important ideas explored and dissected, with dash of erudition

What are the proximal and ultimate causes of the explosive growth in human flourishing and prosperity over the last 200 years that is unequivocally unique in thousands of years of human history? This is a question moderns debate almost as much as "What is the meaning of life?", and "Does God exist?" Antecedents and plausible explanations abounded for thousands of years. McCloskey asserts bourgeois dignity is the ultimate cause, and Clark, Ridley and Feinstein duck, evade, block, counter, and parry in a delightful exchange of ideas, counter assertions, causal direction reversals, bibliographies, and "oh yeah, have you read [some other intellectual giant]?" 4 stars not 5 because I wanted more including a video of a live panel discussion among the authors. Please Cato, can you make that happen?

[The American Conservative]

'McCloskey’s learning is prodigious—ranging across history, literature, and economics—though always lightly worn. She writes chattily, if at times a bit obsessively, and has a great professor’s ability to make the complex accessible.

Bourgeois Dignity, like its predecessor The Bourgeois Virtues, is a tour de force. If the four subsequent volumes are on this level, “The Bourgeois Era,” as her series is named, will stand as one of the great achievements in intellectual history of our time.'

Read the full review, "The Wealth Explosion," on our website:
http://www.theamericanconservative.co...

[Taylor Barkley · Rating 5 out of 5]

Like the first volume in the series, it is very impressive in its scope. The important subject and question it seeks to answer is hidden by the title: why has GDP per capita increased by a factor of 16? McCloskey walks through and refutes every major theory and arrives at her thesis. We don’t think enough about the difference in quality of life between 1800 and now and the rest of human history.

[Bernard English · Rating 5 out of 5]

There are a few reasons to read this great book. McCloskey admits to having friends on the left and right and so she tries to bridge the political divide. She is as comfortable with the humanities as she is with economic modeling, so she is able to bridge the notorious gap between the two cultures. And, she seems to have read a LOT, to the reader's benefit. In fact she explicitly says she reads a lot of books.

Her big insight is that none of the traditional explanations for the industrial revolution taking place in England can really account for the magnitude of the change. Trade, capital, slavery, any given technological breakthrough, low transportation costs, coal or other explanations, could only have contributed a few percentage points of growth, not the phenomenal explosion, which she imagines as a hockey stick lying on its side with the handle hovering over the horizontal time axis for most of history and then the explosion. It's a darn good point. Anyway, many of these factors were present in other societies as well or even previously on the British Isles--without producing an industrial revolution.

I just wish she had compared the inflation adjusted daily earnings explosion of $3 a day for most of history to something like $30 dollars a day with other measures of progress since the Great Fact is so critical to her argument. What I had in mind is something like the numerous graphs Ray Kurzweil provides in "The Singularity is Near." He's got many plots (all logarithmic) showing some technological progress in particular; for example, one is of the progress of Canonical Milestones, stretching back in time for 10^11 years up to contemporary society. I'm convinced that her explanation of the Great Fact, the sudden explosion of progress conventionally called industrialization, in terms of a newfound respect for innovation and bourgeois dignity, is much more convincing than any others I've seen.

She's right that trading between countries shouldn't be thought of as zero sum (competitive) games, as in Paul Kennedy's The Rise and Fall of Great Powers, but more in terms of mutual benefit. However, games provide a model not just for competition, but also for rule-following. And my one quibble is that I'm not so sure some of her economic explanations which are surely valid in a sound money dominated international trading environment, are valid in the absence of sound money. I don't think she addresses this aspect of trade enough, though she cites Mises and Rothbard as among her guiding lights.

She is absolutely right that unfair CEO pay "undermine the American rhetoric that accepts creative destruction. And adds that it matters, though from an economic perspective, the actual sums involved are just a trivial percentage of company earnings. Likewise, though actual trade is usually mutually beneficial, the rhetoric of trade is inevitably patriotic and verging on nationalistic. Exceptions are rare it seems. I wish McCloskey had spend more time on this because it is the perspective through which so many people view trade, whether or not they understand economics. There are four more volumes in the series, so perhaps she does in one of those.

Even if you don't buy her explanation of the industrial revolution, its worth reading her careful refutation of pretty much every other theory offered.

[Oleksandr Zholud · Rating 4 out of 5]

This is the second volume in yet unfinished multi-volume magnum opus regarding history of economic development. The first volume, bourgeois virtues was about how, according to the author change in rhetoric and attitudes created the current world as we know it.

The second volume starts with giving a general overview why the growth is so important – chiefly the problem that throughout the human history most people lived at $3 per day (comparative prices of course), but now the average is the factor of sixteen or $50 per day and some western countries that were the leaders, like the Netherlands have over $130 per day. And this doesn’t account properly for the quality of life – from penicillin to internet TV to not burying half of your children.

After setting ‘the great question’ she starts to take apart all existing hypotheses why that happened. It is done, as she honestly admits, because her own hypothesis, that change in rhetoric, namely liberty and dignity, created the modern world, is quite hard to prove. Thus, by disproving the alternatives she ‘cleans the field’ and the following chapters can be viewed as a review and critique of the existing hypotheses.
The following hypotheses are reviewed and disproved, chiefly by counterexamples from other countries and other time periods, which had similar conditions but it hasn’t spurred the growth:
• It is not exploitation of proletariat, actually the poor won more than rich
• It was not the sheer quickening of commerce, commercial revolution was several centuries earlier
• It was not the struggle over the spoils, exploiting new lands by Europeans
• It was not external trade
• The cause was not science
• It was not better allocation
• It was not better genes and eugenic materialism doesn’t work
• It was not accumulation of capital, inheritance fades
• It were not the better institutions, such as those alleged for 1689

It should be noted that the author is not a mainstream economist, she heavily leans toward libertarian views, but she disagrees with them on idea that liberty is enough, for her a social approval, dignity is important as well.

[Avbac23 · Rating 3 out of 5]

This book is a lot better than the first one in the trilogy!

McCloskey still spends rather too much time refuting authors who've criticized her in the past, when probably most readers aren't in agreement with her critics, or aren't familiar with them. And near the end, she commits the basic fallacy of singing too-high praises of European welfare states without examination of the much-higher costs of living they create... nor of the impact to innovation, which is the primary theme of this book! Stifling innovation in favor of making people comfortable with the status quo, as we have learned in 2020-2021, is how we end up with extreme death rates from COVID-19, and shortages of vaccines because they're unable to develop their own. It is not something we should praise, and especially not something to which we should aspire.

But, despite those weaknesses, this book is chock-full of historical examples of economic concepts, so I think I'll flip through it in the future to take notes on some of the more salient points.

[Colm Gillis · Rating 4 out of 5]

An excellent book. McCloskey adopts a non-reductionist approach to the 'great fact,' the explosion in personal wealth and luxury in many parts of the world over the last 200 years. She sets herself up as a champion of the bourgeoisie (a position most wouldnt apply for) and sets herself against communitarian ideals. The most impressive aspect of the book is the broad range of scholarship McCloskey can call on to refute many of the myths surrounding theories of economic growth. She also writes with much wit and grace, although she tends to ramble on a little. Where the book fails is in not appreciating the role of government and communitarianism in at least providing the ground for economics to grow. Her theory of liberty and dignity being necessary for economic growth can easily be shown to be false and she tends to say that everything bad in the modern era is somehow not the fault of bourgeois ideals.

[Nicki Fruth · Rating 4 out of 5]

If David Foster Wallace wrote non-fiction without footnotes after a career change, you'd probably get this. I find her entertaining, but I feel the way she communicates would be more pleasant in a lecture than a book.

Her premise, that we overlook a shift in rhetoric around what we value and respect in society, and that enabled vocational and material changes seen in the industrial revolution, is unique and interesting. She also has a multi-subject expertise to draw on, make parallels of seemingly disparate areas. The problem is all of the side conversations she goes into to make her points, as well as how often she repeats herself.

It's worth a read, but not sure you have to read all of it to get the point.

[Brandon · Rating 4 out of 5]

A little verbose, sometimes pathologically so, but not without its local pleasures. It's a great survey-critique of the competing theories of the industrial revolution (which is really a metaphor for the beginning of the era of modern economic growth). From what I remember, her chapter on Gregory Clark's argument is almost worthless. The theory that she offers as an alternative -- that unleashing the forces of the bourgeoisie by making their activities legally permitted and socially valued is responsible for the change -- is insufficient. To be glib, not all countries/nations/regions have a bourgeoisie that can sustain a revolution.

[Arda Canseven · Rating 4 out of 5]

Such a fantastic book, only aspect I disagree would be her ad-hominem attacks toward Acemoglu, since he doesn't counter-argument what she put up or present in that book when it comes to how new-institutional economics explains the modern growth. Acemoglu, Demsetz or Robinson, in that regard, never disagree with the fact that there lies something inexplicable as to why industrial revolution or "innovative ideas appreciated by the mass populations during early 17th-18th century for first time in history" really emerged in the Netherlands and UK in the first place.

[Tom · Rating 5 out of 5]

Read it. Read it. Read it. A great sequel of The Bourgeois Virtues.

Deirdre amazingly debunked so many economics fairytales that the clerisies in our days use in populism. This books deals with so many things from imperialism, Jared Diamonds thing, environmentalism, central-planning, Darwinism, Malthusianism (that "don't have kids or you destroy the earth!" sort of thing), and so many other things.

Highly recommended!

[Jon Webber · Rating 5 out of 5]

Wow, excellent academic approach explaining away most economic theory of explosive growth 1830 - 2000. Innovation and respect for bourgeois values, dignity and liberty. Beyond economic prudence of capitalism are drivers fueled by Hope, Justice, Faith, Courage, etc. Combing the middle class story of valued individual innovation with econometric functions.

[Nathaniel Curnick · Rating 3 out of 5]

The arguments are good and clear, but I can't help but wish Deirdre would express the same points in fewer words and with less repatition. You could half the length of this book but keep the information contained the same, which would lead to a much tighter read.
In terms of the economics though: solid

[Apostolos · Rating 5 out of 5]

This volume is an improvement on McCloskey's The Bourgeois Virtues. I am not sure if I am entirely convinced by her thesis, but she makes excellent use of economics, philosophy, literary analysis, and humor to make her argument.

[Henrik Akselsen · Rating 2 out of 5]

Couldn't finish it.

The book's narrative is too unfocused and every chapter (and there is a lot of them) gets long-winded. Much more of the content should be in footnotes.

Although I am sympathetic to get thesis, I cannot recommend this book, in it's current verbosity. Read "Why liberalism works" instead.

[Paul Sand · Rating 5 out of 5]

[Imported automatically from my blog. Some formatting there may not have translated here.]

The subtitle is: "Why Economics Can't Explain the Modern World". It is the second volume in Deirdre McCloskey's exploration of how the bourgeois mindset caused the miracle of prosperity that has lifted much of the world out of abject poverty, and can do the same for many more, if we let it. My report on the first volume in the series is here.

The emphasis here is on varying explanations for the "astonishing enrichment" that occurred in many countries in a relative historical eyeblink. (E.g. Norway, where incomes went from $3/day/person in 1800 to $137 in 2006—and way more today.) As the subtitle implies, McCloskey argues this economic miracle did not have economic causes. Explanations need to meet various challenges: why did the miracle occur here and here, and not there, or there? Why then, and not before, after, or never? And (most important, and often missed) why a hockey-stick increase in prosperity, and not a "mere" modest 2-4% increase per annum? Instead, McCloskey says, the root cause was a flip-flop of respect and encouragement for the commercial professsions and the ideas and values that undergird them.

It's a little funny that this needs to be explained at all: the historical facts are pretty well known. Everybody had their eyes open at the time. Yet the explanations often come with the baggage of ideology (you've heard of Karl Marx, perhaps?). And others resemble the methodology of the blind men exploring the elephant: author A finds semi-plausible cause B, and flogs it mercilessly for a couple of academic papers or perhaps a popular tome that might crack the best-seller list.

So: McCloskey does a pretty good job of shooting down multiple alternative explanataions. It's clear that this is an ongoing academic debate. (And, caveat lector, we are only getting her side of the story here.)

As I noted about the previous volume, McCloskey's style is at the opposite pole from much academic prose. I will plagiarize myself: it's personal (lots of "I"s and "you"s) very funny in spots, fearless and aggressive in argument. Not condescending at all.

I'm not (however) totally persuaded. I tend to the "just dumb luck" theory of economic prosperity: a synergistic combination of factors that nobody intentionally combined or designed, not even obvious in retrospect. Certainly McCloskey's "dignity" revolution is one of those factors; but maybe not the only one?

But I'm a dilettante in this field, so I'm probably wrong. Or maybe I missed or misunderstood the part where McCloskey discussed this. Ignore me.

I was also slightly disappointed by McCloskey's dismissal of Gregory Clark's argument that genetics might have some role in the human social behavior that underlies economic activity. Probably because I'd just read Nicholas Wade's recent book that treats that argument more fully and respectfully. McCloskey gets pretty rude, for example her gratuitous use of "Untermenschen" to caricature Clark's description of various nationalities. That's argumentum ad Hitlerum. Unworthy.

But whatever the details, the point remains: if you want a prosperous society (with all the attendant bells and whistles of peace, health, and opportunities for human flourishing), it's very important that the bourgeois virtues be honored, and the forces of innovation and trade be respected. What was done can be undone.

Virginia Postrel (of course) makes the explicit point better than I: the left wing political elite (including our President) thinks that it's deeply insightful to mock and deride business ("You didn't build that"). Also see Michelle Obama's unsage advice to avoid "corporate America" in your career plans. After reading McCloskey, those attitudes are, at best, a source of head-shaking despair about the future of our country.

[E.A. Amant · Rating 5 out of 5]

This is a most amazing read, the depth and breadth of her insights, her historical grasp of economic life, the simple amount of writers, (old and new in multiple areas of science and the arts), she covers makes one gasp in disbelief. The courage to tackle the rarefied POV that economics is science and not mostly arts is simply astounding in a living breathing human. That she hasn’t been cancelled for this crime against the deterministic close-minded regime is as miraculous as the modern miracle of the last two hundred years that she so deftly explains: The Great Fact.

[Paul Crider · Rating 5 out of 5]

McCloskey offers an invaluable contribution to the quest to understand the causes of what she calls the Great Enrichment, that explosion in human capabilities that has been ongoing since ~1800 or so. The book is in its bulk critical of the other theses that have been suggested by other scholars. Her own theory is unique in that it is resolutely non-materialistic. Ideas matter. Art, literature, etc, but especially ethics and our conversation around these ideas all matter as much as the underlying material concerns. I'm convinced this is the case.

My one criticism is that she's a little unfair to the Neo-Institutionalist theory. This model, at its best, is compatible with McCloskey's special role for ideas and rhetoric.

[Andrew Clough · Rating 2 out of 5]

I was hoping for a book on how people started to respect commerce and how it might have contributed to western economic development. Instead I mostly just got a very unpersuasive attack on competing theories. I spent the book trying to figure out what exactly the difference between her theory and the "Institutions" theory of development was, and didn't find anything in the book to let me figure that out.

Also, listing among the reasons that science couldn't have been responsible for development science's responsibility for the holocaust seemed in rather poor taste.

Still, the overview of modern ideas in development economics was useful and her criticisms of a few were persuasive.