The Evolution of Everything: How New Ideas Emerge

by Matt Ridley

There is no longer much doubt that free commerce has a better economic or humanitarian record than command-and-control government. The examples just keep rolling in. Take the history of Sweden, for instance. Contrary to conventional wisdom, Sweden did not become wealthy as a result of having a big government imposing social democracy. When it liberalised a feudal economy and strongly embraced Smithian free trade and free markets in the 1860s, the result was rapid growth and the spawning of great enterprises over the next fifty years, including Volvo and Ericsson (companies that have since evolved new products). When it expanded government hugely in the 1970s, the result was currency devaluation, stagnation and slow growth, culminating in a full-blown economic crisis in 1992 and a rapid fall in the country’s relative standing in the world’s economic league table. When it cut taxes, privatised education and liberalised private healthcare in the 2000s, it rediscovered growth.