Leave Me Alone and I'll Make You Rich: How the Bourgeois Deal Enriched the World
... All agree that it's "inequality that kills" but how does this actually work? Sub-clinical pellagra stunts and slows individuals and fails to develop prosperity and a bourgeoisie creating bradykinetic macroeconomics and poverty from the pathology of ill health [8][9][10]. First, however, lets recap on some basic building blocks of civilisations starting with water but then majoring on meat and nicotinamide. ...
North-South variation in the supply of meat has always been present. Sharing of meat was the rule but in the multi-centric Neolithic revolution when domestication of animals and plants co-evolved class differences became pronounced-aristocrats and inferior proletariats and “lesser breeds and lower orders” started to form. The distribution of natural domesticates was uneven with the near-east and a temperate band across Europe well off compared with Africa and the Americas. The Columbian exchange changed this as meat became abundant in the New World who then exported to Europe. Wars, expropriations and genocides were over the meat supply and acquiring pastureland or water. Colonial plantation profits paid for meat imports from “settler colonies” indigenous or poor peoples on low meat pro-pellagrous diets were considered inferior whatever their colour and had poorer health and life expectancy. Attempts to correct hunger in the resultant ramshackle “Third world” concentrated on calories fuelling population booms and busts and delaying demographic, epidemiological and economic transitions. High meat variances are narrowing in China and Asia but need help elsewhere in the South. Dangers of not developing with a safe and sufficient meat supply include the emergence of zoonoses and mass migration. Reparations, rehabilitation and rejuvenation should concentrate on reconstituting a meat commons giving us a shot at redemption and survival.
... Still, the mechanism in which market entrepreneurial opportunities are identified, evaluated and exploited still has many remaining aspects of the proverbial black box, especially in the context of the BOP, which researchers are still working at trying to unpack (Alvarez et al., 2015;Alvarez and Barney, 2014;McCloskey and Carden, 2020;Si et al., 2020). As presented above, the turbulent setting of BOP places both opportunities and challenges for entrepreneurs to start a business. ...
Purpose
Driving economic development at the bottom of the pyramid (BOP) is an enduring global challenge. While the market-based approach places hope on entrepreneurship as a major impetus to drive the underdeveloped economy, the performance of entrepreneurial businesses and their impact on poverty reduction are sometimes below expectations. This paper seeks to examine the factors that may be hindering entrepreneurship within the BOP context. This paper presents preliminary answers and provides research suggestions related to this question.
Design/methodology/approach
In order to identify the reasons behind the underperformance of entrepreneurship at the BOP, a comprehensive literature review was conducted to see what is already known about this puzzle.
Findings
By reviewing extant literature, four clusters of factors were found to shape entrepreneurial activities at BOP: (1) Individual-level factors may be restraining entrepreneurial activities within BOP context, (2) gender inequality at BOP is hindering female entrepreneurship, (3) insufficient institutional support is holding back entrepreneurial activities in BOP and (4) business development initiatives are making multi-faceted impacts on entrepreneurial activities in BOP.
Originality/value
This paper contributes to theory in that it is the first comprehensive review of literature on constraints of entrepreneurship in the context of BOP. In investigating influential factors of entrepreneurial success in the BOP context, the authors recognize four major influential forces that are shaping entrepreneurial processes at the bottom of the pyramid and further propose three directions of future research that are worthy for further exploration.
... But that would suggest, according to the Samuelsonian (but not Coaean) understanding, that they should be paid, to achieve efficiency of allocation, which is not the case. It is the characteristic mistake of economists who do not understand the economics after the Marginal Revolution (for example capacity to adjust to, the many negative side-effects of economic growth [namely, the high D and B that accompany a signing on to the Bourgeois Deal: "Leave me alone and I'll make you rich"] (Howitt 2005, p. 10;and Mokyr 1990, p. 179;and McCloskey and Carden 2020). "Those negative side-effects," Howitt continues, "are almost always the result of... the destructive side of creative destruction." ...
Any innovation—mechanical, biological, institutional, scientific, artistic, personal—begins of course as a new idea in a liberated human mind. The point is obvious. But it has not been prominent in economics. The agent in economic models does not have agency. He merely accedes to a budget line or to a law or to a custom or to a habit of thought facing his already known utility function. He does not create, that is, but reacts in requisite fashion. Human action, the liberated will, is absent. He is a vending machine, not an innovator, or not even an ordinarily choosy consumer exploring her tastes. Therefore the unprecedented economic growth since 1800, a Great Enrichment of a fully 3,000 percent increase in real income per person, has been traced by economists not to “innovism,” as one might call it. The Enrichment has been traced rather to various routine and intermediate and largely material causes—investment; exploitation; the rule of law. Some of these are necessary, but none is sufficient to explain our enrichment. They are ancient. They are often trivial. They are sometimes necessary, but never have the great oomph to explain the Great Enrichment. The creation of new ideas in human minds, in other words, has been firmly set aside by economists. The non-economists who might save the ideational day, meanwhile, have seized on the wrong ideas, such as the labor theory of value or disenchantment or the Enlightenment or sheer modernity. The economic trouble with the economist’s non-ideational causes such as investment and institutions or exploitation is that they are merely allocative, and are, further, subject to sharply diminishing returns, and are commonly indeed zero sum. They are routine, not transformative. They are small potatoes beside the 3,000 percent increase in human material welfare. And the historical trouble is that most of them, and even most of the non-economist’s ideational causes, are of very, very long standing—in ancient Mesopotamia, commercialization; in ancient Athens, enlightenment; in ancient Rome, good property rights; in ancient China, long canals; in medieval Italy, skilled craftsmen; in early modern Japan, long peace; in 18th century Prussia, cameralist policy; in pre-1860s Sweden, Protestantism; in Russia 1917-1989, fierce pursuit of profit; in China 1948-1978, fierce pursuit of central planning. Yet no Great Enrichment ensued in such places. Early on, the cause of the Enrichment was said to be piling up physical capital, emphasized by Adam Smith, with the division of labor. Then it was indeed an ideational cause, put forward on the left or right of politics by anti-economists, such as the rise of “capitalism,” or “possessive individualism,” or “secularized asceticism.” All have all been rejected in later research. Then it was the alleged routinization of innovation, such as Joseph Schumpeter came to believe, against his early belief in human creativity. Then it was human capital, from elementary education to craftsmen’s skills. Then it was institutions of various sorts, from legal to scientific. But all of them depend of course upon ideas conceived in somebody’s mind—and foundationally on her ideas about ideas, such as ethics, ideologies, political philosophies supporting the liberated imagination. The change of ideas in human minds, that is, seems a more promising hypothesis. The ideational change is called liberalism. The idea of a non-slave society, it can be shown, has the oomph and the novelty to account for the 3,000 percent. I propose here, mathematically and quantitatively, by historical comparison and by the paradoxical logic of creativity, to offer, that is, a fresh ideational explanation for why the modern world became so very rich—well, “my” explanation is as “fresh” as can be a restatement of the 18th-century promise of human liberation. The crux, I claim, was liberalization at the level of ideas in the Netherlands and then in Britain, favoring a culture of somewhat free speech and an economy of quite energetic enterprise. It was followed during the next century by actual liberalizations and a consequent explosion of creativity—in the U.K the civil emancipation of Catholics, the abolition of Jamaican slavery, the free importation of wheat from Kansas and Ukraine, and then similar liberalizing measures in the U.S., Sweden, Italy, Japan, and the rest. Adam Smith and Thomas Jefferson and Mary Wollstonecraft had put forward in the Anglophere the then-bizarre notion that no one should be a slave, that all people are created equal, and should be permitted liberated speaking and liberated voting, and liberated buying and selling. Richard Cobden and John Stuart Mill in the mid-19th century extended the idea. The equality of permission in liberalism proceeded to erode the inequalities of hierarchies anciently stultifying. It made people bold to venture. As the British say in their sporting manner, appropriated by the economic historian Peter Matthias, ordinary people were permitted by liberalism for the first time, after 1776 or 1789 or 1848 or 1865, to “have a go.” And go they did. Liberalism was gradually implemented in northwestern Europe, as lately it has been, at any rate in the economy, even in far China and India. And the Great Enrichment came. Both economists and their critics, in other words, need to understand the conditions for the flourishing of liberty and its fruits in novel ideas for enrichment, and to see that good laws and long railways and honored science and skilled craftsmen and strong institutions are all good, but are not themselves originating. Creativity depends on liberty and its ethical accompaniments, every time. Liberation in ethics and ideology yielded an innovism, not a “capitalism” that one can find in Mesopotamia in 2000 BCE or in England in 1066 CE or Mesoamerica in 1492 CE. To use a mechanical image, the gearing in the historico-economic watch was, to be sure, investment and institutions, necessary for any economy at any time, from the caves of Lascaux to the caves of Wall Street, or for that matter in Crusoe’s cave. But liberal thinking was the new and largely sufficient spring imparting motion to the old and stiff gears. It happened in Britain, but not immediately in, say, France. It could have happened in Japan or the Ottoman Empire, but in the contrived corridors of history it did not. The implication for policy is straightforward. Ideas in human minds, as Keynes said, largely rule the world. The Ukrainians defend themselves for the idea of liberty, not for the policies of left, right, or middle. Encouraging a loving and responsible liberty, with its mighty material and spiritual consequences, should be our chief aim. Coercive, illiberal nudges and taxes and subsidies and regulations and fines and imprisonments, of which policymakers are so very fond, are not the path forward. The liberal path of an honest and competent but restrained state, under which ordinary people are permitted without let or hinderance from other people to have a go, has already led in much of the world to a stunning enrichment of the poorest. It’s the Bourgeois Deal: “Leave me alone and I’ll make _you _rich.” In the next couple of generations, it promises to permit the rest of the wretched of the earth to raise themselves up. The illiberal path of statism, by contrast, leads to the radical populisms of left and right, to Maduro and Putin. And even its middle path of well-meaning regulation and redistribution it leads adults back into childhood under the masterful state. It turns back to the subordination that characterized agricultural societies until 1776, and to its corresponding poverty of body and mind and spirit. Liberalism worked to overcome such childishness and subordination. It works yet.
This study examines the effect of organizational trust on the employee work outcomes of affective commitment and service-oriented organizational citizenship behavior (OCB) along with the mediation effect of attitudinal pride and the moderation effect of social approval. Data were collected from 70 companies in Taiwan, comprising 680 individuals involving multi-phases of data collection. Overall, organizational trust was shown to affect organizational attitudinal pride and employee work outcomes. The results further indicate that organizational attitudinal pride mediates both the relationship between organizational trust and affective commitment and service-oriented OCB. In addition, social approval was supported to moderate the relationship between organizational trust and affective commitment as well as the indirect relationship. This study addresses the gap which adds to our understanding of how social influence from outside of an organization also impacts social approval, which can affect employee attitude toward the employer and subsequent work outcomes.
Humanomics, an approach to studying human behavior championed by Vernon Smith, Bart Wilson, and Deirdre McCloskey, is rooted in an acknowledgment that human beings self-examine their conduct and sentiments. The economic way of thinking, therefore, must be located within the mass of evidence about human behavior produced outside of its neoclassical silo. Since public choice and public policy analysis, in general, have inherited much of their methodologies from economics, the lessons of humanomics apply equally there, too. The overwhelmingly dominant method of economic analysis, Max-U-under-constraints, invites a policy activist to play with the “rules of the game” to nudge mechanically reacting maximizers toward desirable outcomes. In contrast, humanomics helps the analyst to identify the underlying causes of those outcomes in the ideas and actions, not mindless reactions, of thinking, knowing, and feeling humans. In addition to other achievements, the new approach already has produced, we argue that the humanomics framework provides a clear explanation and motivation for voluntary (uncompensated) human blood donations and offers plausible and testable answers to the open questions about the general success of that policy. For the policy analyst, humanomics suggests that policy proposals must ask more than just whether the policy is effective and efficient. Instead, it must ask whether the policy is consistent with how human beings act in the real world, under real circumstances, with real people.
The usual international comparison of the trends of the most immediate indicator of well-being—i.e., the per capita gross domestic product—points out how, contrary to what is often thought, the Italian run up with respect to the main Western countries was concentrated in the two decades immediately following the Second World War, without extending very much to the preceding decades as to the following decades.
Economic freedom is the fundamental right of every human to control his or her own labour and property, and therefore it constitutes the essence of the market economy. In this sense, economic freedom leads to economic growth and although economic freedom can have an impact on economic growth, it is necessary to specify those aspects of freedom that can foster growth. This paper examines the nexus between economic freedom and economic growth in the Least Developed Countries (LDCs), using panel data for the period of 2000-2021. In particular, we investigate the effects of economic freedom on economic growth in the LDCs by using the 12 dimensions of the economic freedom index published by the Heritage Foundation. Accordingly, this study investigates the potential effects of freedom on growth, revealing that economic freedom is a growth stimulus factor and although not all pillars are determinants of growth in the LDCs, the significance of economic freedom as a whole is crucial. By using different estimation methods (Fixed effects model and Principal Component Analysis), we confirm that economic freedom influences growth in the LDCs. Furthermore, certain variables related to financial development, political stability, capital formation and education, are key for attaining economic growth in these countries.
Must we always pursue economic growth? Kogelmann answers yes. Not only should poor countries pursue growth, but rich countries should as well. Kogelmann aims to provide a wealth-insensitive argument – one demonstrating all countries should pursue growth regardless of their wealth. His central argument – the no halting growth (NHG) argument – says no country experiencing growth should stop it, because doing so requires undermining the conditions causing it and those conditions are independently morally desirable, so they should not be undermined. For countries not growing, he may argue that they have an obligation to implement the conditions that cause growth because they are independently morally desirable. Call this the implementation argument. I contend that neither argument is wealth-insensitive as each fails to establish an obligation to pursue growth. I attempt to diagnose how this could be and propose that it is a product of attempting to answer three questions about growth simultaneously.
This Element explores the topics of terrorism, counterterrorism, and the US government's war on terror following the September 11, 2001 terror attacks. It draw on insights from Austrian and public choice economics. First, the foundations of the economics of terrorism are discussed emphasizing that the behaviors of terrorists and counter-terrorists are purposeful and goal-oriented. Then, the economics of counterterrorism policies and the importance of institutional change is considered. Next, the three dilemmas facing liberal societies as it relates to counterterrorism efforts is focused on. The Element then provides an assessment of the US government's war on terror. It discusses the origins of the war, discuss whether it can be judged a success or failure, and consider some of the main effects both abroad and within the United States. The final chapter concludes with a discussion of several areas for future research.
This chapter explores the importance of ‘getting the culture’ right. Culture is not an immutable trait or an essential characteristic of a people, nation or group, but as a set of dynamic values that evolve over time. The prevailing climate of opinion, determined by intellectuals and various dealers of ideas, affects whether society supports growth-enhancing activities or socially sanctions them. Accordingly, liberal values rooted in respect for individual rights, dignity and agency are essential ingredients for economic development and progress. By dignifying wealth-creating activities of entrepreneurship, work and investments, liberalism unlocks the economic potential of nations. Ultimately, however, the prevailing cultural climate in society is a product of an uncertain process of competition in the cultural marketplace, where various entrepreneurs put forth different social values and struggle for dominance.
Despite its invaluable contribution to the field of comparative economics, the socialist calculation debate has focused on the narrow topic of the impossibility of the rational economic calculation under socialism. The literature on new institutional economics suggests that economic development is determined by economic and political institutions which are far more complex than the issue of economic calculation. To bridge the gap between the calculation debate and new institutional economics, this paper utilizes the historical case studies of Perestroika and Deng's China to demonstrate relationship between state capacity and economic calculation. We argue that rational economic calculation requires the state's institutional ability to make a credible commitment to constraints inhibiting public predation.
This article presents the history of anti‐black racism in the United States as a case study of the interrelation between economic institutions and racial (in)tolerance. It begins by reviewing the current social science on the topic of economic systems and tolerance. It then moves from the history of slavery through Reconstruction and the Jim Crow era to the Civil Rights movement, demonstrating that government intervention in the economy helped maintain a racial hierarchy and solidify racist attitudes. The article concludes by arguing that liberal economic institutions are a means of dissolving segregated racial orders and creating more tolerant, integrated ones.
We investigate the role of individualistic social rules and norms in charitable giving. Individualism in market societies is often criticized as corrupting morality and discouraging charitable giving. We contest that view. We propose direct and indirect mechanisms through which individualism increases charity. In the direct channel, individualism encourages self-interested giving. In the indirect channel, individualism contributes to charity by reinforcing economic freedom. We use evidence from a large cross-section of countries and several measures of individualism to investigate both channels. Our empirical findings confirm each channel and support the insights of classical liberals, such as Adam Smith and David Hume, and more recent studies in the humanomics tradition, which recovers the argument that individualism has its virtues.
There has been much research undertaken over the years to better identify the factors leading to both firm and economic growth. These range from building an understanding of innovation, particularly of non-rivalous goods to better examining the increasing returns present in increasingly networked economies. In Central Asia, studies of firm and accompanying economic growth have been more on the quantitative side in examining aggregate factors such as industry productivity and the resulting impact on GDP. The current research seeks to review the economic growth literature and its links with innovation and human capital in the context of a Central Asian economy. Top down and particularly bottom up policy implications are also examined. An Interpretive Phenomenological Analysis (IPA) is also taken in interviewing Iranian researchers and experts from the areas of economics, entrepreneurship, science and technology, and public policy. They are interviewed to illustrate how innovative human capital can contribute to firm development and economic growth in a major Central Asian economy not normally associated with innovative human capital and new ventures. Potential implications for firm growth through innovation and enhanced human capital are identified and linked to the Central Asian context and its traditional, historical attention to individual development and the freedom to “have a go.”
In this review essay, I compare and contrast Peter Boettke’s The Struggle for a Better World (Mercatus Center, 2021) and Daniel Bromley’s Possessive Individualism: A Crisis of Capitalism (Oxford University Press, 2019). Each of these books considers the future of capitalism. Boettke’s Struggle sees capitalism as the only morally and economically justifiable system but that continual effort is necessary to ensure the capitalist enterprise succeeds. Bromley’s Crisis sees capitalism as a spent force that no longer does what it was meant to do—namely, improve the economic well-being of households. There are surprisingly many points of agreement in these books, most notably a concern for the downtrodden in society and an appreciation for the legitimation crisis confronting capitalism. There are also important differences that will give anyone interested in the future of capitalism much to ponder. Boettke sees unconstrained government as the primary threat to legitimacy; Bromley identifies the possessive individualism that lies at the heart of our current capitalist system as the source of the crisis. Both books make a significant contribution to our understanding of the institutions governing capitalist economies and powerful arguments as we contemplate the future of capitalism.
We investigate the role of individualistic social rules and norms in charitable giving. Individualism in market societies is often criticized as corrupting morality and discouraging charitable giving. We contest that view. We propose direct and indirect mechanisms through which that occurs. In the direct channel, individualism encourages self-interested giving. In the indirect channel, individualism contributes to charity by reinforcing economic freedom. We use evidence from a large cross-section of countries and several measures of individualism to investigate both channels. Our empirical findings confirm each channel and support the insights of classical liberals, such as Adam Smith and David Hume, and more recent studies in the humanomics tradition, which argues that there is virtue to individualism.
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