Tuesday, March 28

An optimist’s guide to the future: the economist who believes that human ingenuity will save the world | Books

Why is the Anglo-Saxon world so individualistic, and why has China leaned towards collectivism? Was it Adam Smith, or the Bill of Rights; communism and Mao? According to at least one economist, there might be an altogether more surprising explanation: the difference between wheat and rice. You see, it’s fairly straightforward for a lone farmer to sow wheat in soil and live off the harvest. Rice is a different affair: it requires extensive irrigation, which means cooperation across parcels of land, even centralised planning. A place where wheat grows favours the entrepreneur; a place where rice grows favours the bureaucrat.

The influence of the “initial conditions” that shape societies’ development is what Oded Galor has been interested in for the past 40 years. He believes they reverberate across millennia and even seep into what we might think of as our personalities. Whether or not you have a “future-oriented mindset” – in other words, how much money you save and how likely you are to invest in your education – can, he argues, be partly traced to what kinds of crops grew well in your ancestral homelands. (Where high-yield species such as barley and rice thrive, it pays to sacrifice the immediate gains of hunting by giving over some of your territory to farming. This fosters a longer-term outlook.) Differences in gender equality around the world have their roots in whether land required a plough to cultivate – needing male strength, and relegating women to domestic tasks – or hoes and rakes, which could be used by both sexes.

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Galor has been interested in a lot more besides; his book, The Journey of Humanity, stretches from the emergence of Homo sapiens to the present day, and has a lot to say about the future, too. In just over 240 pages it covers our migration out of Africa, the development of agriculture, the Industrial Revolution and the phenomenal growth of the past two centuries. It takes in population change, the climate crisis and global inequality.

There will be inevitable comparisons with Yuval Noah Harari’s Sapiens, not least because this too is a work of “macrohistory” and Galor is also from Israel, though he has taught at Brown University in the US for the past 30 years. “If you’re born in a place that is incredibly rich in history, you understand that you’re part of a long, long lineage. You see the Temple Mount that was there 3,000 years earlier. You’re really walking in history. So the link to earlier stages of development is very much part of my upbringing in Jerusalem.” The Journey of Humanity is certainly being pitched, at least in terms of impact, as another Sapiens – translation rights have already been sold in 27 languages. But the similarities may be quite superficial. Sapiens was first published when Harari was a young professor, based on a series of lectures to undergraduates. The Journey of Humanity is the culmination of Galor’s career, the recasting of an earlier work, a maths-and-data-heavy book called Unified Growth Theory, in digestible form.

And while Sapiens ends on an equivocal note, warning that present-day civilisation teeters between the singularity and armageddon, the signal characteristic of The Journey of Humanity is its optimism. If you need an evidence-based antidote to doomscrolling, here it is. The extraordinary increases in standards of living, huge falls in child mortality, incredible gains in knowledge and technology – these are the products of inexorable forces that are not going anywhere, Galor argues, and will only augment as time goes on. Even pandemics and wars, horrific as they are for the millions caught up in them, “cannot divert the journey of humanity from its long-term path”. Surprisingly, given the circumstances we find ourselves in, the book is highly persuasive: Galor builds his case meticulously, always testing his assumptions against the evidence, and without the sense of agenda-pushing that accompanies other boosterish thinkers – the Steven Pinkers or Francis Fukuyamas of this world.

Looking ahead … Oded Galor. Photograph: Peter Goldberg

What sets him apart, perhaps, is a grounding in numbers. “I was an unusual economist in the sense that I always had sort of a deep interest in the mathematics of discrete dynamical systems,” he tells me. Examples of discrete dynamical systems include populations of bacteria or human beings that evolve constrained by things such as food supply or susceptibility to disease. Zooming from his office in Rhode Island, Galor speaks evenly, sounding as though he is always about to break into a half-smile. Like Pinker, he has a shock of silvery hair that approaches his shoulders. “I was sort of an interdisciplinary student, very interested in macro-history, very interested in political science, very interested in economics, and very interested in mathematics. So part of my ability to construct this unified theory of economic growth was those deep mathematical foundations.”

What is his theory, then, and how does it appear to break new ground? Economists have always found it difficult to reconcile two distinct eras. During the first, any increase in resources led only briefly to greater prosperity. More food, for example, meant people could raise more children. But the gains were lost because a bigger population meant everyone had a smaller share of the pie. This is known as the “Malthusian trap” after the gloomy clergyman and demographer Thomas Malthus, and it lasted a couple of hundred thousand years.

Then, suddenly, beginning in the 18th century, everything changed. In an increasingly technological world, it paid to be literate and better trained. As a result, parents focused their resources on raising a smaller number of children equipped with the skills they needed to make it in the world. They were investing in “human capital”, and soon the state did too: quite quickly the whole population became much better educated. That meant it was more likely to invent new things that made it easier to produce wealth, which was in turn ploughed back into human capital: a virtuous cycle. The rocket ship of progress took off.

You might assume that different rules were operating in these two different periods. Galor’s “unified” theory yokes them together, arguing that the underlying engine of growth has always been the same. “I basically model how the advancement of technology feeds back into both the scale of the population and human adaptation, and how in turn, human adaptation and the scale of the population advances technology.” This has been going on, he says, since “the very dawn of the human species”. So why that sudden change around 1760? Galor likens it to another kind of dynamical system – water boiling in a kettle. The heat of innovation begins the moment you switch it on, but only at a certain point near the end do bubbles riotously break the surface. The accumulated increase in temperature brings the system to a tipping point. The Malthusian trap, Galor says, simply “vanishes”, just as water turns to steam. But unlike with a kettle, there’s no off switch, because the “heat” of technological innovation is a self-reinforcing process.

Rice-planting season in Nepal
Rice-planting season in Nepal … irrigation requires cooperation across parcels of land. Photograph: Narendra Shrestha/EPA

Viewed in this way, the Industrial Revolution was a benign development: less dark satanic mills than sunlit uplands. But what about the hideous conditions, the slums, children put to work in factories because their little hands could reach into the moving parts to clear away debris? Galor argues that industrialisation in fact more or less eradicated child labour, and had the added bonus of instigating universal education.

Because of the demands of subsistence living, child labour had been an “intrinsic element of human societies throughout history,” he writes. At the time of the Industrial Revolution, however, it had reached a peak that only further technological change could remedy. It did that in two ways: first, machines quickly became better at doing the kind of basic work children had been used for. Second, the need for a skilled workforce meant that it was in employers’ – and parents’ – interests for children to learn rather than work. Universal education followed, spurred on by industrialists, and opposed only by the landed gentry who realised that if tenant farmers’ children went to school, they would go and get better jobs elsewhere. In any case, Galor’s data shows that “the scourge of child labour first disappeared in the most industrialised nations and, within them, in the most industrialised areas”.

It’s a little harder to see another side effect of industrialisation through rose-tinted glasses. A huge increase in pollution made lives dirty and difficult at the time, but has bequeathed an even deadlier legacy to us and future generations: climate change. Can Galor really be optimistic about that too? “So my view is a bit complex,” he says carefully. “What triggered climate change is, yes, pollution created since the Industrial Revolution. At the same time, that revolution created two additional important trends. First, it started a fertility decline that initially occurred in the western world and gradually diffused around the globe. Even India is now having fertility just at replacement level, which is incredible. And then at the same time, we know that this decline in fertility freed an enormous amount of resources for investment in human capital.”

The Journey of Humanity

With that comes greater potential for technological progress. “If the growth of population starts to decline, this itself will reduce the current trend of carbon emissions. And then the power of innovation causes me to be confident that perhaps within two or three decades, we will have revolutionary technologies that will reverse those emissions. Now, we cannot envision what these revolutionary technologies will be. But I do believe, as we saw in the context of Covid, that such technologies will emerge and will allow us to prevail.” If that seems like a stunning gamble, Galor is clear that he’s not for putting all our eggs in a techno-utopian basket. He clarifies that “actions to mitigate carbon emission are critical ingredients in averting the potential catastrophic consequences of climate change”. It’s just that he believes there are two other vital weapons in our arsenal: fertility decline and innovation, both of them inevitable consequences of growth.

Not that he recommends simply watching and hoping; he has policy prescriptions too. In the case of the climate crisis, they come a bit out of left field. Climate policy should not stop at cutting carbon: it should involve pushing hard for gender equality, access to education and the availability of contraceptives, to help drive forward the decline in fertility. Demographic advocacy like this, he says, might be better received by developing countries than an insistence on regulating industry, since “they provide the benefits of economic growth alongside environmental preservation”.

Growth is good, then, but no one needs reminding that its benefits haven’t been felt equally. Explaining the different trajectories of countries since the 18th century takes up as much room in The Journey of Humanity as the mechanism of growth itself. The basic idea is that those places that were a little bit further behind in the run up to the Industrial Revolution soon found themselves left in the dust. This is where the “initial conditions” really came into their own. So, perhaps your land had been less suitable for growing high-yield crops. Or maybe you lived in a part of the world beset by livestock-bothering Tsetse flies. Politics and institutions played their part too: in 1485, for example, the Ottoman sultan banned movable type printing using the Arabic script in order to protect religious interests, ceding a head start to northern European nations that took up the invention with alacrity.

As progress gathered pace, countries that started out with an advantage pressed it ruthlessly, enslaving and colonising others, and using the expropriated resources to turbo-charge their own growth. Once industrialisation started in earnest, the colonised were essentially held in a state of arrested development, farming to provide food and raw materials for their imperial masters, whose economies were freed up even further to specialise in advanced technologies.

There’s one remaining part of the jigsaw. To explain it, Galor starts with a colourful analogy. He asks us to imagine a land mass that has five different colours of parrot on it: blue, yellow, black, green and red. A hurricane hits, and some of the parrots are blown on to a neighbouring island. It’s unlikely that every kind of parrot would have been picked up by the winds; perhaps only the green, blue and red ones, making this breakaway population less diverse. In time, a few of these parrots migrate to another island, and again they represent only a subset of the population: just the blue and red ones. This third population is even less diverse.

Galor argues that this is precisely what happened when Homo sapiens left Africa, and the pattern was repeated with each onward migration. Africa is the most diverse place on the planet, genomically and culturally, and diversity has a knock-on effect on prosperity. It accounts for about a quarter of the otherwise unexplained variation between nations, Galor calculates; in contrast, diseases (the Tsetse fly, malaria etc) account for one seventh, and political institutions (democracies versus autocracies) less than one tenth. What is it about diversity that makes such a big impact? Social cohesiveness – low diversity, in other words – can have its benefits, particularly in earlier phases of development. But in the modern world, or the boiling kettle phase, cultural fluidity is the greatest driver of innovation. “Like biological breeding, the mating of ideas … benefits from a broader pool of individuals,” he writes. That mating of ideas gives rise to new policies, new inventions and enhanced productivity, stoking the engine of growth. Culturally fluid societies are also more likely to be able to adapt to changing conditions.

Galor believes, not uncontroversially, that there might be a sweet spot between homogeneity and fragmentation, where diversity and cross-pollination thrive without undermining social cohesiveness. Countries may sit outside of that spot in either direction: they can be stultifyingly monocultural, or fractious and prone to civil strife. In 2012, he was challenged by a group of academics who warned that the suggestion of an “ideal level of genetic variation” could be misused to “justify indefensible practices such as ethnic cleansing”. Galor responded that the criticism was based on a “gross misinterpretation” of his conclusions. And the policy prescriptions they generate are, on the face of them, benign. “If Bolivia, which has one of the least diverse populations, would foster cultural diversity, its per capita income could increase as much as fivefold,” he writes. “If Ethiopia – one of the world’s most diverse countries – were to adopt policies to enhance social cohesion and tolerance of difference, it could double its current income per capita.”

Rather than saying that genes equal destiny, Galor’s message appears to be that whatever the circumstances you have inherited, change is possible. It’s an analysis of the human condition that leads not to a counsel of despair, but a new set of tools he believes can help build a better future. But is that all wishful thinking? I ask whether his innately sunny disposition means we should distrust his intuitions. “I think that I do have a positive outlook in my personal life. Naturally that must be projected on to the way that I view the world.”

“But when I’m projecting my optimism,” he adds, “I’m projecting it based on my study of history.” Galor contends that his work goes beyond intuition, even beyond theory: “This has all been explored empirically, in a rigorous way.”

It’s tempting, particularly at this moment in history, to bask in a silver-haired sage’s confidence in his facts and figures. Maybe that in itself should cause our sceptical antennae to twitch. For many, though, a dose of faith in human progress will be hard to resist.

The Journey of Humanity: The Origins of Wealth and Inequality by Oded Galor is published by Bodley Head. To support The Guardian and Observer, order your copy at guardianbookshop.com. Delivery charges may apply.


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