Virginia Postrel: What Separates Rich Nations from Poor Nations?

Virginia Postrel, author of The Substance of Style: How the Rise of Aesthetic Value Is Remaking Commerce, Culture and Consciousness, writing in the NYT (Jan. 1, 2004):

THOSE who do not learn from history are doomed to repeat it. To that old saw, an economist might reply, "If only it were so easy." Then every country could be rich.

Alas, the process of economic development is hard to repeat. The great mystery is why. In recent years, economists have returned to their field's oldest question: What accounts for the wealth of nations?

"The real question now that everybody wants to know is, 'Why isn't the whole world rich? Why can't they be like us? Why couldn't the former Soviet Union become immediately like Switzerland or Denmark ? Why is Africa mired in this horrible pool of poverty?"' says Joel Mokyr, an economic historian at Northwestern University .

"Once you admit that that question is on your agenda, which it now is, you can't do without history," he continues, "because you want to know how the rich countries got to be where they are. You need to look at their experience and compare it to the experience of the others." Those who do not learn from history may in fact never repeat it.

Professor Mokyr is the editor of the Oxford Encyclopedia of Economic History, a five-volume set just published by Oxford University Press. The encyclopedia took 10 years to complete, a short time given its scope. "Economic history," Professor Mokyr writes in the preface, "covers nothing less than the entire material existence of the human past."

The encyclopedia gives theoretical economists a way to check their ideas against the realities of the past. "You guys can't write these big, fancy models without looking at the details," Professor Mokyr says.