In Box

The Prehistoric Wealth of Nations

Development prescriptions for the world’s poorest countries are a dime a dozen: better institutions, less corruption, healthier people, even a more temperate climate. But what if the wealth of nations were determined in 1000 B.C.? In a report (pdf) for the National Bureau of Economic Research, economists Diego Comin, William Easterly, and Erick Gong found ...

Development prescriptions for the world’s poorest countries are a dime a dozen: better institutions, less corruption, healthier people, even a more temperate climate. But what if the wealth of nations were determined in 1000 B.C.?

In a report (pdf) for the National Bureau of Economic Research, economists Diego Comin, William Easterly, and Erick Gong found that measurements of the technological know-how of the civilizations that preceded today’s nation-states in 1000 B.C., 0 A.D., and 1500 A.D. offered surprisingly accurate predictions of how they would develop as modern countries. Snapshots of the presence of technology — such as writing, draft animals, and metalwork in 1000 B.C. and 0 A.D., or sea-going vessels, block printing, and the magnetic compass in 1500 A.D. — reveal that places with a history of such knowledge are today many of the world’s richest nations. Most remarkably, regions that had adopted all of the expertise available in 1500 A.D. now have a per capita income 18 times greater than those that hadn’t.

"[The connection] started as a hunch," says Easterly, "but we didn’t expect it would go back so far." Even when controlling for critical factors like colonialism, the authors were able to predict disparities based on their historical explanation. "Seventy-five percent of Africa’s current income lag relative to Europe can be statistically explained by the technology lag in 1500," says Easterly. "That’s quite different from the usual view."

But development economists may be reluctant to part with the idea that the wealth (and poverty) of nations can be attributed to the legacy of colonialism, the impact of aid, or the competence of modern governments. Politicians still have tremendous influence over growth, says C. Peter Tipper of the Center for Global Development, and they shouldn’t be allowed to "blame their ancestors a millennium or two ago if they fail" to reduce poverty. True, and it’s probably cold comfort to realize the playing field hasn’t been level for 3,000 years.

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