Joel Mokyr’s widely acclaimed book A Culture of Growth (2018) has important parallels to the work of Peter Bauer (1915–2002), a pioneer in development economics. Both economists recognize the importance of culture and a competitive market for ideas in fostering economic development.
Mokyr was primarily interested in explaining the factors that led to the Enlightenment and the Industrial Revolution, while Bauer was concerned with the transformation of a subsistence economy into an exchange economy. His careful observation of less developed countries (LDCs) in Southeast Asia and British West Africa in the 1940s and 1950s convinced him that many of the leading ideas regarding the determinants of economic growth were wrong. He presented strong evidence that poverty was not self-perpetuating, that external trade was beneficial both in enlarging consumption opportunities and spreading new ideas, and that culture matters on the road to prosperity. He recognized the failure of state-led development and the promise of freedom, individual choice, and limited government.
The Economist praised Mokyr’s book, saying, “It is refreshing that an economist is taking seriously the idea that ideas and culture make a difference to economic growth.” This article examines some of the key ideas of Mokyr’s book and shows that Bauer shared similar views with regard to the importance of ideas and culture in fostering economic growth.
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