The Evolution of Everything: How New Ideas Emerge

by Matt Ridley

Then with the rise of the welfare state, in the late twentieth century monogamy began to break down again. Once the man’s role of breadwinner is replaced by a welfare payment, it is an empirical fact that many women increasingly begin to think that monogamy is a form of indentured servitude they could do without. Some parts of society have abandoned marriage and adopted the practice of single motherhood, serviced by wandering, polygamous men.

And then they began to change from centres of production to centres of consumption. In America as a whole, nearly twice as many people work in grocery stores as in restaurants. In Manhattan, nearly five times as many work in restaurants as in grocery stores. When corrected for age, education and marital status, city-dwellers are 44 per cent more likely to visit a museum and 98 per cent more likely to go to a movie theatre than rural Americans.

Today, the most successful cities, like London, New York and Tokyo, are places of fancy food, entertainment, mating arenas (sorry – clubs) and opportunity for the aspiring poor. From Rio to Mumbai cities are the engines of prosperity, the places where people make the transition from poverty to comfort and even wealth. And the ‘death of distance’ engendered by the internet and the mobile phone, far from encouraging people to retreat to isolated idylls in Montana or the Gobi desert, is having exactly the opposite effect. Now that we can work anywhere, the anywhere we mostly want – at least when we are young – is the densest, most high-rise, most hectic of spots.

Robert Solow in the 1950s was able to tease out just how much it was contributing by counting the contribution of capital and labour, and deducing that the rest (87.5 per cent) of the change in living standards must be due to technological change. It is technological change that is the chief source of increasing returns: of the fact that economic growth for the world as a whole shows no sign of reaching a plateau. Little wonder, then, that Deirdre McCloskey describes the system that produced the great enrichment of the past two centuries as ‘innovationism’ rather than ‘capitalism’. The new and crucial ingredient was not the availability of capital, but the advent of market-tested, consumer-driven innovation. She locates the cause of the Industrial Revolution in the decentralisation of the production and testing of new ideas: ordinary people were able to contribute to and to choose the products and services they preferred, which drove continuous innovation. For the Industrial Revolution to happen, trial and error had to become respectable. As she put it in a lecture in India in 2014, the enrichment of the poor has resulted not from charity, planning, protection, regulation or trade unions, all of which merely redistribute money, but from innovation caused by markets,

Take six basic needs of a human being: food, clothing, health, education, shelter and transport. Roughly speaking, in most countries the market provides food and clothing, the state provides healthcare and education, while shelter and transport are provided by a mixture of the two – private firms with semi-monopolistic privileges supplied by government: crony capitalism, in a phrase. Is it not striking that the cost of food and clothing has gone steadily downwards over the past fifty years, while the cost of healthcare and education has gone steadily upwards?

As for transport and shelter, broadly speaking the parts that the market supplies – budget airlines, house-building – have got cheaper and better, while the parts that the state supplies – infrastructure and land planning – have got more expensive and slower.

Socialisation means learning how to fit in with other people of your own age. Children acquire their habits, their accents, their favoured language, and most of their culture from their peers. They spend a lot of time learning to be similar to these peers. In forming relationships, however, they learn to discriminate between different people, adopting different behaviours with different individuals. And then in their teens they begin to assess their relative status within their peer group. In the case of men, this mostly means working out how tall, strong and domineering you are, and adjusting your ambitions and personality accordingly. There’s a fascinating finding in economics that taller men earn more money throughout their careers, but that it is their height at sixteen, not at thirty, that best predicts their earnings. The reason for this, as other studies have shown, is that this is when men decide their status, and shape their personalities accordingly. So what employers are rewarding are the attributes of self-confidence and ambition that came partly from being a tall, strong football player at school, rather than the height of the person today. Women tend to decide their status based largely on relative attractiveness, and they judge their attractiveness based on how others seem to judge them. In both sexes therefore, says Harris, there is a tendency to settle some aspects of your personality in the mid-teens, based on how high you think your relative status is am...

Still more surprising to many people is that in conditions of greater economic equality, IQ becomes more heritable, not less. In a world of more ample and more equally distributed food, obesity becomes more heritable, not less. This is because where many go hungry, fortune will largely determine who gets fat. Once everybody has enough food, the ones who get fat will be the ones with a genetic tendency to do so, and fatness will appear to run more in families – to be more heritable. The same with intelligence. Once everybody gets a similarly good education, the high achievers will increasingly be found among the children of high achievers, rather than the children of those with the best resources. It follows that a high correlation between the achievements of parents and their children, far from indicating that the parents are giving their children unfair environmental advantages, indicates instead that opportunity is being gradually levelled.

American presidential politics is entirely based on the myth that a perfect, omniscient, virtuous and incorruptible saviour will emerge from the New Hampshire primary every four years, and proceed to lead his people to the promised land. Never was this messianic mood more extreme than on the day Barack Obama won the presidency. This was the moment, he himself had said in June 2008, when ‘the rise of the oceans began to slow and our planet began to heal’. He was going to ‘heal this nation’, close Guantánamo Bay, reform healthcare, bring peace to the Middle East. He was given the Nobel Peace Prize simply for having been elected.

Since as men clawed to the pinnacle of office, all the time They strewed their path with perils. And at the apex of their climb, Often Envy would blast them like a thunderbolt, to fell Them with disdain and hurl them in the pit of hateful Hell Lucretius,

Bottom–up monetary systems – known as free banking – have a far better track record than top–down ones. Walter Bagehot, the great nineteenth-century theorist of central banking, admitted as much. In his influential book Lombard Street, he effectively conceded that the only reason a central bank needed to be a lender of last resort was because of the instability introduced by the existence of a central bank.

bad news is manmade, top–down, purposed stuff, imposed on history. Good news is accidental, unplanned, emergent stuff that gradually evolves. The things that go well are largely unintended; the things that go badly are largely intended. Let me give you two lists. First: the First World War, the Russian Revolution, the Versailles Treaty, the Great Depression, the Nazi regime, the Second World War, the Chinese Revolution, the 2008 financial crisis: every single one was the result of top–down decision-making by relatively small numbers of people trying to implement deliberate plans – politicians, central bankers, revolutionaries and so on. Second: the growth of global income; the disappearance of infectious diseases; the feeding of seven billion; the clean-up of rivers and air; the reforestation of much of the rich world; the internet; the use of mobile-phone credits as banking; the use of genetic fingerprinting to convict criminals and acquit the innocent. Every single one of these was a serendipitous, unexpected phenomenon supplied by millions of people who did not intend to cause these big changes.