Bourgeois Dignity: Why Economics Can't Explain the Modern World

This is a very good book, specially considering the usually low quality of academic research on the topic of the industrial revolution.First the author starts the book by explaining what she defines as "The great fact" which is the fact that while for most of history living standards have been stagnated at a very low level, circa 3 dollars a day in per capita terms according to the book while in the last 250 years incomes have exploded by a factor conservatively estimated at 10-20 times. While I agree that modern economic growth was unique in terms of scale I do not think that for the whole of human history economic growth was insignificant. This is demonstrated by the fact that huts escavated by archaeologists in China dated from the neolithic and the bronze age increased in size by a factor of 3-4 (from 7-8 square meters to 25-30 square meters). While the tiny huts of 14th century peasants were actually a great improvement over the huts of Celtic and Germanic tribesmen, or from the huts of early medieval peasants. From a geographical perspective, the living standards in 1st century Roman Italy were much better than those of Northern Europe, in terms of housing the difference is huge: houses dug in Italy were 20-30 times larger than the huts of the celts and germans. The living standards in Europe improved steadily (though, very slowly) from the 8-9th centuries to the 18th century. Seem from the perspective of modern growth, however, it looks quite small in scale and was a very slow process. So the author is correct on the uniqueness of modern economic growth, but I wouldn't stress so much the lack of economic progress in the pre-modern world.The author does an excellecent job in demolishing the very numerous falacious theories of why the industrial revolution occured. Theories of the industrial revolution range from the idea that people got more greedy, from the concept of primitive accumulation of capital, where centuries of accumulation of "frozen capital" were at once deployed into the great industrial facilies that started the modern era and from the eugenic theories that centuries of genetic selection in England favoured people more adapted for industrialization. McClonskey demolishes all these theories and them proposes her own explanation for the Great Fact: that cultural change was the fundamental cause of the modern era. Before the 18th century innovating entrepreneurs weren't accorded dignity and after the "bourgeois reevaluation" they were.In that respect I agree with the author, but the exact details seem a bit lacking. After reading the book I had a much better idea of invalid models for the industrial revolution but I still am not fully convinced that it was cultural change in the direction of greater dignity for entrepreneurial activities that played the fundamental role. While the author claims that it wasn't the size of the British or European market that created the industrial revolution by arguing that trade in the Indian ocean was larger in scale and involved larger markets than European pre-industrial markets. That's incorrect. It was estimated that Indian ocean trade involved merchant fleets of gross tonnage ranging from 50,000 to 100,000 tons. For comparison, the whole European merchant fleet by 1780 AD had gross tonnage of 3.8 million tons, at the time when the industrial revolution is said to have begun, dozens of times larger than those of non-European societies. While the last 200 years have been spectacular, one has to remember that in all of human history no previous civilization had reached the degree of complexity attained by Europe at the turn of the 19th century. It was a civilization of over 200 million people (the combined population of Europe and it's American offshots) covering half of the world's landmass, while Chinese and Indian civilizations covered 5% of the world's landmass and had populations of 130 and 160 million respectivelly, in 1700 AD. Britain by 1780 had over 10 million inhabitants and represented the most complex economy of this size in all of human history: Athens and Venice also were complex and prosperous market economies, but their populations numbered only the hundreds of thousands. Large countries were historicaly poor and simple subsistence economies (like pre-modern France and China). So the argument that scale and the size of the markets is not a valid explanation for the Great Fact because other markets in the past were bigger is not valid: not in all of human history there was a market economy comparable in scale to the extended order of European civilization by the time of Napoleon. And scale is important because more people engaged in a market means more ideas which means more innovations which means faster economic progress.The very fast economic progress of recent decades is also the consequence of the even greater scale of our modern global market economy of billions of individual potential innovators. I conclude that the scale of our modern markets is an important element of our uniquely fast rate of economic progress as more people mean more ideas and more ideas means more innovations which implies in faster economic growth.

The book offers many interesting insight and should be read as a strong case for a revaluation of the role of bourgeoisie in the history of economic progress. Opposing "materialist" explanations, it is also a strong defense of how ideas can change the world.Beside of freedom, Professor McCloskey adds another quite important element which contributes to the ascent of middle class in Western countries before, and later in the East Asia: "dignity". The task of circumscribing its meaning in an effective way is surely difficult and it could be better understood declining the Latin concept of "dignitas" in a bourgeois way. European bourgeoisie won the hostility of kings and princes, resisted against the exploitation from political power but gained also an unprecedented legitimation of its role winning also the "social envy" deeply rooted in rural and pre-capitalist societies.Indeed, some criticisms are quite right: - the role of saving and innovation appears underscored, with particular regard of the cumulative effects of both; - focusing too much in the attempt to show why the industrial revolution didn't happen there and there the author gives the impression to be victim of a confirmation bias; - trying to isolate the "right" and "exclusive" causes of an unique, irreversible and so fruitful event probably is a too hard task for both history and economics.But the reader should deserve credit to Professor McCloskey and her work: criticisms should be contextualized. Focusing on "liberty" and "dignity" the author catches a very important combination of elements which enable us a better and deeper understanding of the role the bourgeoisie during the industrial revolution. It's my personal conviction that it is better and more fruitful to incorporate the "core" of the lesson than overemphasizing the imperfections of an ambitious task which stresses unconventional but very interesting thesis.Even if I don't agree completely with all the ideas exposed in the book, when asserted in a "strongest" form, I hope it could be translated as soon as possible in Italian.Dr. Silvano FaitFirenze, Italy

I read Bourgeois Virtues, am finishing Bourgeois Dignity and own Bourgeois Equality. There is much good concrete knowledge in these books. However, the explicit Postmodern context is a big probem. Postmodernism is a nihilism with truth as arbitrary and conventional. McCloskey says reason is foresight (evading concepts), and that grass can reason. And that the 2008 Recession was caused by capitalism. He evades faith as ideas without evidence. He evades the difference between basics and non-basics. He thinks that cultures other than Greece and the Enlightenment were as rational and those two basically rational cultures. He praises cultural respect for the bourgeous view without identifying context. There are many more important problems, eg, he doesnt mention Say or Mises, important students of capitalism. He evades the content of Ayn Rand's philosophy, claiming it as merely conventional selfishness. He advocates mysticism. But the advocacy of the middle class and innovation and rejection of materialism are important.

I'm no economist, nor an academic, so hard to know how this work fits in with the literature, i.e. the various established positions on the historical event of the Industrial Revolution. But the book identifies two facts which as a layman I had not grasped: one, that starting around 1800 developed country spending per person leaps from $3 per person where it had been for ever, to $100 per person today (in current USD), and the global average across all people (despite huge population growth) is now $30 per person. So something happened a few hundred years ago that changed the direction of the world economy. Fine. Second point though, is that established explanations for this fact suffer from a series of problems, the clearest being that the supposed causes (e.g. trade, property rights, capital etc) existed, often for hundreds of years, prior to the explosion of the industrial revolution. McCloskey's own explanation is that the dignity (& liberty) offered to innovative middle class business people - the attitude to the entrepreneur, say - significantly changed in Holland and then Britain, and explains the triumph of capitalism. As I say, I cannot tell how well this theory holds up against competing theories not represented in McCloskey's book, but her efforts frame the question well enough that I'm prepared to give her answer some weight.

This is a well written book that makes an important point: standard economics is a failure in explaining why income per capita has risen over twenty-fold in the modern world. While McCloskey's explanation has some weak points in it, her comprehensive knowledge of the competing theories is a mighty arsenal arming her well in her systematic attack on the other theories about why the Industrial Revolution occurred. As a Professor teaching economic history I am placing her book on my reading list along with some of the books that she demolishes in her critiques. I am hoping students will benefit from the intellectual debates opened up by this approach, ideally encouraging them to think for themselves.

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You are asking me a review too early as the book is quite long. I have to say that the subject is of high interest and the discovery almost astonishing. Nevertheless, the argument goes repeating itself a chapter after the other, giving endlessly more of the same. I hope that I will have the patience to read more until something new happens, but I won't swear it.

You want to know how the Banking world gets away with it. Read this book.