A Farewell to Alms: A Brief Economic History of the World

An ambitious and provocative new book by University of California at Davis economic historian Gregory Clark, A Farewell to Alms: A Brief Economic History of the World attempts to explain two huge questions: 1. Why did one part of the human race finally break out of the "Malthusian trap"--in which growth in per capita income is washed away by subsequent population growth--namely England, at the end of the 18th Century, through rapid and sustained technological advance? 2. And why did the prosperity made possible by the Industrial Revolution successfully spread to some countries but not to others? In the process, Clark offers a stunning rebuke to economists: "God clearly created the laws of the economic world in order to have a little fun at economists' expense. In other areas of inquiry, such as the physical sciences, there has been a steady accumulation of knowledge over the past four hundred years. ... In economics, however, we see instead that our ability to describe and predict the economic world reached a peak around 1800. In the years since the Industrial Revolution there has been a progressive and continuing disengagement of economic models from any ability to predict differences of income and wealth across time and across countries and regions." In other words, economists were closer to understanding the wealth of nations in 1776 than they are today. The pioneering economic works of Smith and Thomas Malthus (1798) accurately described the world before the Industrial Revolution that was just getting underway then with the employment of the steam engine in cotton mills. By 1817, when David Ricardo was pessimistically propounding what later came to be known as "the Iron Law of Wages," England was moving in a new, liberating direction unexpected by economists: a shortage of cheap labor turned out to be a blessing . The future belonged to countries with high wage, high quality work forces. Clark's book idiosyncratically combines the strengths and weaknesses of both economists and historians. The strong point of economists is that they believe in "theory" in the same sense that hard scientists do--as a tool for simplifying our understanding of reality and for making more accurate predictions. Yet, because economists have mastered some theory, they tend to view reality not as what needs to be explained but as a vague inspiration for the occasional stylized example to illustrate their theories. In particular, economists don't read much by non-economists. Just as their theory would predict, economists are driven by self-interest, and their profession does not much reward curiosity about anything written by outsiders. In sharp contrast to economists, historians love facts and hate theories, a predilection that has the opposite advantages and disadvantages. Historians tend to be omnivorously curious and humble about how much they don't know. On the other hand, their love of detail makes them less likely to see the big patterns. While

The value of this book is enormous and is reflected well in the large number of high quality reviews posted. Above all else the value of the book is that it makes you look at data both new and familiar in radically different ways. I admire a book that sets out right at the beginning its intent to provoke new research, counter argument and hope to move our knowledge without arrogantly asserting that it has found the Holy Grail of explanation. I was not entirely convinced by his thesis that differential survival rates deployed middle class values downward; but it is very challenging and intriguing. I was even less convinced by this application of this to current developing countries, but as part of an explanation I could see many of his insight contributing to understanding if not taken in isolation. So I strongly recommend this book as a primer in new data and new approaches and I think that the author really wants us to think deeply about what he is saying and improve on it, refine it, refute it and this is a welcome change. I hope the University of California Davis increases his salary as per his humorous footnote on economists being overpaid everywhere but Davis.

Gregory Clark's A Farewell to Alms is the most informative book about economic history that I know. On about 380 pages and with nearly 200 illustrations, Clark describes the dynamics of the Malthusian economy that prevailed worldwide up to the time of the industrial revolution, and the industrial revolution itself. It is smoothly written, focuses on the important issues in economic history, and is immensely informative. This combination makes it suitable both for the historically interested non-specialist and the expert. Above all, I recommend it as a textbook for undergraduate courses in economics and history. However, the author goes beyond the traditional stock-in-trade of the field. He emphasizes that the industrial revolution in England was preceded by behavioral changes whose consequences he sees manifested in declining homicide rates and declining interest rates, both indicative of a population that became less impulsive and more focused on long-term goals than had been the case in earlier times. He might as well have added the unprecedented proliferation of ideas and innovations in the arts, sciences and philosophy that characterized Europe throughout the centuries from the Italian Renaissance to the French Enlightenment. This trend shows rising intellectual sophistication not only in England, but in most or all parts of Europe. In particular, he shows that in preindustrial England there was differential reproduction on a massive scale: Generation after generation, rich men had nearly twice as many surrviving children as poor men. This meant not only downward social mobility, which was certainly deplorable. It also implied that both the cultural values and the genes of economically successful people penetrated throughout the society. Today's Europeans are, by and large, descended from the upper social classes in medieval and early modern times. Clark is one of the first economic historians to realize the importance of Darwinian mechanisms in cultural and economic advance, even on a time scale of only some hundreds of years. I recommend this book for its clarity, the wealth of data that the author uses to illustrate the points he is making, and especially the focus on the important issues: How did the Malthusian economy work? What were the determinants of fertility, mortality and wealth during pre-industrial times? Why was pre-industrial Europe more prosperous than pre-industrial China and India? What trigered the industrial revolution in England? When did efficiency gains outpace population growth? Why did large wealth differentials between countries develop since the mid-19th century?

Did you know that the average person's life in the Stone Age was no worse then that of the average 17th century Briton? That given their more varied nutrition and lesser workload, the lives of hunter gatherers were superior to both? That the Black Death caused a major improvement in European standards of livings during the 14th to 16th centuries? That the institutional conditions for economic growth, as normally understood, were better in the Middle Ages then they are today? These are only few of the mind blowing and well documented claims put forward in Gregory Clark's breathtaking - there is no other word - "A Farewell to Alms". Clark confronts the greatest mystery of human history - why did the West leap forward, breaking away from millennia of stasis, to create the modern, industrial world? Clark not only refutes most of the common wisdom about the rise of the West, but also brings forth an astonishing array of data in support of a radically new interpretation. No doubt some specialists would disagree with Clark's conclusions; I have my doubts, too - but Clark's methodology, his thoroughness, and the rigorous manner in which he addresses a huge quantity of data makes "A Farewell to Alms" an instant classic and a model for all economic history. Clark describes world economic history as essentially a two-phase story. The first phase, from the dawn of time to the Industrial Revolution, featured a barely changing world governed by the cold and remorseless laws of Malthus and Darwin. But those same laws brought on a slow revolution, and a new phenomenon was emerging - first in Europe, and slower in India, China and Japan - Economic Man. Reverend and Economist Thomas Robert Malthus (1766-1834) was the first to thus describe the world economy: in his model, people's wages were equal to the subsistence level; whenever wages increased, population increased, and pushed wages back to subsistence. Therefore, Clark argues, throughout history population was at equilibrium - whenever new technology increased productivity, the result was not higher living conditions, but higher population. Thus the difference in living conditions between times and places were caused by such effects as the different in hygiene level (improvements in hygiene ironically pushed down living standards by allowing people to survive on meager wages) and death by war and pestilence (which, equally ironically, pushed up wages). And then, in the 18th century, in a relatively small island nation, everything changed. The Industrial Revolution transformed the world, or at least England, Europe, the US, Australia, Japan and nowadays China and South East Asia. Mankind broke free of the Malthusian trap. Productivity growth rose in two orders of magnitude; Productivity gains no longer led only to population increases, but also to increase in the standards of living. The West today is rich beyond the wildest dreams of its 17th century ancestors. What happened? Most expl

This book is absolutely amazing, on a par with Diamond's Guns Germs and Steel. The industrial revolution allowed England to escape what has been called the Malthusian Trap--a condition common to every pre-industrial society. In the Malthusian Trap, any recognizeable gain in wealth by a society would result in a slight increase in population. As the population would rise, however, living standards would go down, and the death rate would go up. For this reason, population growth remained at a glacial pace of 0.005% for thousands of years. Then the industrial revolution happened. For the first time, population and prospertiy could increase in lockstep, trending ever upwards over long periods of time. By why did this happen in some places and not in others? Despite its many benefits, why has it proven to be so difficult to export the industrial model to other areas of the world? These are but a few of the questions that Clark addresses in his original and thought provoking book. What I have taken away from this book is that a lot of good will and human effort has been wasted by not taking in to account the significant differences that exist between people and cultures. We falsely assume that the fruits of industrialization are so obviously desirable that other peoples should do whatever they have to do to make the necessary adaptations to reap its rewards. But we are largely ignorant of why this can't so easily be done. The industrial revolution came to be within the context of a certain unique culture, and it makes sense that it could not be easily duplicated among other people with different values and ways of life. In attempting to explain the differences in wealth between one population and the next, Clark's approach is cultural. But here's the key: these cultural differences were shaped by selective pressures experienced by some peoples and not others. The conditions which gave rise to the industrialization of England were not present among other populations and are not even to this day. That is why it has proven to be be so difficult to duplicate elsewhere. His arguments in support of this thesis are clear, persuasive, original and rigorous. This book is a must read for anyone interested in understanding the monumental importantance of economic and cultural differences between cultures. The questions he raises adds a new dimension to ones perspective. I predict that at some point, when discussing solutions to the poverty which billions still confront, you will not be able to post a good argument without also being familiar with his.