20 jul 2020
Episode 8 features the acclaimed economic historian Joel Mokyr.
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The Covid Tonic, Episode 8 Transcript
By Joel Mokyr & Marian L. Tupy
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The full video interview between Marian L. Tupy and Joel Mokyr can be found here. The transcript is below.

 

 

Marian Tupy: One thing that struck me in terms of humanity's response to the pandemic is that the importance of new ideas has been pretty much internalized throughout our species. We don't pray to gods or sacrifice to them in order to rescue us from COVID. Instead, we hope and pray that scientists will come up with new ideas. Since we are talking about ideas, I thought, who better to talk to, but Professor Joel Mokyr. We will talk about the importance of ideas in terms of human progress in general and COVID in particular, so thank you very much for doing this with us, Professor Mokyr.

 

Joel Mokyr: My pleasure.

 

MT: In your research, you differentiate between the Smithian and Schumpeterian growth. Can you briefly mention the difference between the two, and why are new ideas so important to Schumpeterian growth in particular?

 

JM: Well, Smithian growth is the kind of growth that Adam Smith was talking about, which is why it's called Smithian growth, and it's basically based on what economists would think of as gains from trade and better allocation. One of the best-known demonstrations in any Introduction to Economics class if that if Region A starts trading with Region B where before they weren't trading, they are both better off. So you get something that looks like economic growth: better institutions, peace, better transportation. Things like that will create trade where there wasn't any before, and everybody is better off. Then, they can specialize where they have a comparative advantage. This whole sort of story that we tell is really independent of technological change. Schumpeterian growth is about technological change, and therefore, it is about new ideas. Now, new ideas can be big. They can be small. They can be written down, or they can just be implicit and tacit in people's heads. There's various forms of it, but the basic idea is that we get better at making the same things cheaper and better or maybe making new things that we weren't making before at all. And those are hugely different processes because, as I see it, at least Smithian growth can take you a long way toward economic progress and it can make you richer and it did in many instances. Historically speaking, trade and things related with trade did lead to well-being in northern Italy during the Renaissance or the Netherlands during the Golden Age, but eventually it tends to peter out because at some point, you exhaust all the advantages of trade. You may be richer, but you're not going to keep growing anymore. In the theoretical, the limit of this of course is when all transaction and transportation costs have gone down to zero, which of course never happens, but that's a sort of theoretical limit. At that point, Smithian growth ends. A more realistic scenario perhaps is what's happened within the EU in the last decades. The EU reduced transportation and transaction costs between different member countries, and it led to a great deal of prosperity, but by now, those are probably largely exhausted. It's unlikely that growth on the basis of specialization within the EU is going to give you the kind of growth that we've been getting since the beginning of the EU in 1957. That's the kind of thing I’m talking about. Now, with Schumpeterian growth based on new ideas, that kind of limit as far as anybody knows doesn't exist. We don't know if there is a limit to the new ideas that people can come up with. There are debates about this. My learned colleague Robert Gordon thinks that at some point, we're going to reach a stage at which everything that can be invented has been invented. People said this before. It's never happened, but you can't be absolutely sure that it will never happen, of course. But I don't see it quite frankly and certainly not in our lifetime. I think scientists are really embarking on new and exciting frontiers right now that promise a great deal of progress in the future, and I don't quite think that we should be pessimistic about the possibility of the economy to fundamentally keep growing based on new ideas. Whether we measure that growth correctly or not is a different matter, and there's all kinds of interesting debates about whether GDP or some other measure is the right metric, but basically everybody understands and expects that new ideas are going to give us more progress and more prosperity. 

 

MT: So if I understand you correctly, it goes something like this: people create ideas, ideas create inventions, and inventions and innovations lead to Schumpeterian growth. Would that be correct? 

 

JM: Exactly. There are things in between because ideas aren't enough. Just ideas will not get you there. What you need is an environment in which these ideas can be translated into action.

 

MT: Obviously, the counterargument could be made that people always had new ideas, and yet, it is only in the last 200 to 300 years during the Schumpeterian growth that these ideas have been translated into this very fast growth rate. Why did that happen? Why is Schumpeterian era so different from previous ones? 

 

JM: People have always had new ideas, but these ideas weren't usually focused on production. They were thinking about philosophy. They were thinking about God. They were thinking about all kinds of things that interested them, but the day-to-day work of the farmer in the fields and the blacksmith in his workshop and the sailor on the on the seas was not of interest to them. If you look at Greek and Roman civilization, compared to their intellectual ability, their technological achievements were actually quite modest. Moreover, if you look at my own forebears, the Jewish civilization, they were brilliant people. They had the fantastic ideas. The Bible is full of ideas, but in terms of technological progress. there wasn't all that much there. It really depends a little bit on the intellectual environment. What kind of ideas are they coming up with? And I think the great breakthrough that occurs in the world happens in the 16th and 17th century and this the beginning of what I call the Industrial Enlightenment, when it dawns upon Europeans that it's worth thinking about nature, about physics, about chemistry, about biology, about astronomy so that we can harness these new ideas to our productive needs, and that's really a breakthrough. The other point I would make to answer your point is that when people start thinking about how to make production better and come up with innovations, that's not enough. The example I always give to my students is the hundreds and hundreds of sketches that Leonardo Da Vinci made of various wonderful machines, and Leonardo Da Vinci is just the tip of the iceberg. There's a whole set of writers in Europe and in China for that matter who described new ideas about agriculture, about mines, about mills, about various construction devices, and nobody can build these damn things because the workmanship and the materials aren't there. You need qualified artisans who can then take these blueprints and models and make them work and scale them up and make them actually part of the economy. That's hard to do. Most countries don't have that kind of workmanship, and the great success of Europe is that in the 18th and 19th century, Britain and then everybody else built up a labor force that could take these new ideas and actually turn them into reality. So yes, people always have had ideas, but these ideas don't automatically translate into economic growth. That is a modern invention.

 

MT: What role did culture play in enabling new ideas to be turned into reality? I assume that people were not always open to new ideas.

 

JM: Here is one of the great arguments I’ve been making now for decades, and the more I think about it, the more I believe that I’ve got it right. I don't know how important it is, but this a cultural trait that I really feel strongly about, and that's the following: how much ancestor worship is there in the intellectual sphere, where people actually create new ideas. The odd thing is that when you start looking at intellectual history in any kind of society, you are struck by how much respect many thinkers have about the wisdom of their ancestors, and how little they are willing to deviate from what they thought their ancestors knew. So at some point, there's somebody who creates a body of knowledge. It may be the Bible or it may be Confucius or it may be Aristotle, but somebody creates the body of knowledge that's then embodied, usually in a book, and that is then considered to be sacrosanct. You're not supposed to come up with new ideas because that would be heresy. Every society fights heresy as much as it can, and so what happens is that body of knowledge tends to be crystallized. Aristotle was basically a gospel for all matters scientific for hundreds of years. In China, it was Confucianism. In Jewish civilization, it was the Talmud and the things that came before it. So the wisdom of earlier generations is often considered to be sacrosanct. That's stifling. Islamic civilization may be the best example of that. At some point in the 12th century, people like Al-Ghazali basically said that anything that deviates from the Quran and Hadith would be heresy, and so that seems to be the normal state of the way people think, and what you need is a world in which people are willing to look back at the knowledge of their forefathers and basically say, “These guys were smart. We're smarter.” And that's what you see happening in Europe in the late 15th, 16th, and 17th centuries. One thing after another gets overthrown. In medicine, it is Galenos. In physics, it's Aristotle. In geography and in astronomy, it is Ptolemy and on and on it goes. This what I have documented at some length, but it isn't just science. This age invents biblical criticism. People look at the holiest of holy books, the Bible, and they go, “This was written by people. Look, Chapter 17 contradicts Chapter 23, so it must be written by different people.” When people start thinking logically about this and they become critical and they say that some of this stuff is wrong, I think that is an incredible cultural breakthrough. That really only happens once in the history of humans as far as I can see. It doesn't happen in China. In the end, new Confucianism becomes like a harness in which Chinese culture is imprisoned. In Islamic civilizations, it’s even worse. They won't even print books. We Jews are terribly conservative until the 19th century. The only important Jewish thinker who got up and said that a lot of this stuff needs to be criticized was Spinoza, and Spinoza was ostracized by the Jewish community completely. He was kicked out, and nobody could talk to him. Nobody could communicate with him. The Jews said, “We don't want anything to do with this,” and that I think is a cultural prerequisite to any kind of progress because if you get too enamored by the wisdom of your forefathers, you're not going to make any progress. And somehow, we are hardwired to do so. And the Europeans broke out of it, which I find this astonishing, but that's what created economic modernity.

 

MT: Do you have a pet theory about why in Europe at that particular time, this kind of openness was given a latitude? One of the explanations that I like in particular was advanced by Stephen Davies from the Institute of Economic Affairs, who wrote a book basically claiming that because Europe didn't have a hegemon and all of these European countries were fighting each other, the governments of those countries had a choice: either we are going to open our intellectual sphere so that more growth and more ideas are generated as we survive or we are going to clamp down on dissent and new ideas and we are going to go down under and somebody is going to take us over. Are you attracted to that explanation?

 

JM: Not only am I attracted to it, I think that is clearly a large part of the explanation. It certainly explains, for instance, what happened in Europe and not in China because China is a single empire, which can control what people are thinking. What you see in Europe is that any kind of clamping down on intellectuals who are thinking outside the box, who might be heretics, is doomed to failure because you're looking at a massive coordination failure. If you decide that so-and-so is a heretic in your country, all that's going to happen is that he's going to take his suitcases and go somewhere else. In fact, a lot of people did, even in England, which is a tolerant country. Never forget that Thomas Hobbes wrote Leviathan in exile in Paris, and John Locke wrote The Essence of Toleration in Amsterdam. These people sometimes had to flee their country. Even in the Netherlands, this was true. There were times when intellectuals fled, but at some point, this becomes common knowledge. Everybody knows that that if you clamp down on intellectuals, they're just going to go away and so there's no point. Eventually, in the late 17th to 18th century, this all becomes window dressing. There is still censorship, but the censors don't work. Nobody can really control the flows of ideas anymore, and nobody tries really hard. If you look at the French censorship of people like Diderot and Russell and so on, if they write a book that's too outrageous, they go to them and say, “That wasn't very nice. We will burn a few of your books, and you go to Scotland for a few years so we don't have to look at you.” But the idea that they would burn him like they burned Giordano Bruno in 1600, that doesn't happen anymore, and that's because they know that this is doomed to failure. Some countries are run by united and reactionary rulers, and these countries fall behind. There's an argument that this happens to some extent to much of Europe South of the Alps: Spain, Portugal, parts of Italy, which were governed by the Inquisition, and the Inquisition said, “We don't care. We're going to clamp down on heretics.” So that's why the center of gravity of science moves north to England to France to Germany and to the Netherlands. I am not sure if I buy this theory, but by and large, I think everybody knows that this isn't going to work. That said, I think the political fragmentation, which is a big theme in in in global history, is not enough. Because there was fragmentation in the Middle Ages. You’ve got a feudal system. You have fragmentation in Africa and fragmentation in India. You need more than that, and so I would argue that the other reason why Europeans are slowly being disenchanted with previous knowledge is that from 1500 on, there really are a bunch of cognitive shocks that are administered to Europeans, which make them doubt the wisdom of the ancients. The discovery of the new world of course is a major one. Clearly, nothing in the writings of the ancient Greek philosophers predicted anything like that. Aristotle predicted you couldn't cross the equator because you'd be burned alive. Well, Bartolomeu Dias did this, and he came back. And all kind of other things are slowly dawning on people that the ancients were wrong. For example, Aristotle’s cosmology basically is that there are these five planets that you could see with the bare eye and that they moved around all the other stars. Their number was fixed. And then in 1583, a Danish astronomer Tycho Brahe observes a supernova, and all of a sudden, there's a star that wasn't there before and now it's there. And he goes, “Hey, wait a minute. Aristotle said you couldn't do that, so if he's wrong about that, what else is he wrong about?”  Look at Gilbert’s writing about magnetism and a whole bunch of people, particularly one of Galileo’s student, basically showing that, contrary to what Aristotle said, you could create a vacuum because they built a vacuum pump. Aristotle of course says nature abhors the vacuum. You can't have a vacuum. Well, here's a vacuum. So slowly but certainly they realize they know more than Aristotle and some of the things Aristotle said are just demonstrably wrong, and that in itself is an idea. What you get in Europe is the war between the ancient and the modern. The ancients really say, “Oh my god, the classics knew far more than us than we do. They wrote better poetry. They wrote better plays. They were better than every regard.” And the modernists said, “No, they were good, but we're better.” That's the frame of mind that I think is really critical.

 

MT: Okay, so openness, criticism, and toleration of new ideas are very important. Do you see any cultural trends or even institutional trends today in the world that are most threatening to the generation of new ideas? If new ideas are important, do you see any dark clouds on the horizon?

 

JM: I do see the dark clouds on the horizon because in all societies there are benighted people who are anti-science and anti-progress. Some of them come from the right. They are people that that that deny the theory of evolution. What other country in the world has a creationist museum, where people walk next to dinosaurs and other rubbish? So we have people on the right, and we have people on the left. They're also against their progress, not because they don't think it can be achieved, but because it's bad for us, it's bad for the planets, it's bad for animals, and so on. You have people on both sides. Why this doesn't keep me up at night is precisely what you said earlier, which is that there is no hegemon, and so no country in the long run can afford to fall behind. New techniques are going to be proposed, and either you adopt them or else you're going to fall behind, and if you don't do it, somebody else will do it. If the European Union is still opposed to genetically modified organisms, they're being developed somewhere else. They'll develop here in the United States, or if the United States is going to ban them, they're going to move offshore somewhere. But somebody's going to do it because the world is too decentralized and too uncoordinated to suppress innovation, and if the innovation works, eventually it will become inevitable. I think that kind of progress is built into the system, and as long as the world is divided into many countries or blocks of countries that are competing with each other, I think progress is almost assured. That said, the one thing of course that everybody worries about is what's going to happen to freedom of thought. You need a certain kind of environment in which there is a high rate of tolerance for non-conformists. One of the things I teach my students is the great paradox of Soviet science. In some ways, you would have expected the Soviet Union to be hugely successful scientifically because they don't have all the problems of appropriability of knowledge that the West has and all the sort of reasons economists point out why the market for ideas really underproduces. But in the Soviet Union, the government can subsidize as much research as they want. And in some areas that was true. They were the first ones to send the satellite into space. I still I’m old enough to remember Sputnik. They did develop certain things, and yet as a source of scientific and technological progress, the Soviet Union was a dud. Most people believe that contributed mightily to the fall of the system, and the reason I think is because you need a society where non-conformism is tolerated. And non-conformism is indivisible. You can't have a world in which people can say, “Oh, I disagree with this physical theory, but of course what Chairman Xi is saying is absolutely sacrosanct.” You can't have that. Critical minds have to be critical minds. I am worried that the world is moving more and more toward an increased suppression of non-conformism, and I don't know what governs that, to tell you the truth. It's very hard to know. I don't understand why in many European countries, we now have autocratic governments that systematically suppress the opposition. Now, I don't think what happens in Hungary or in Poland or even in Russia is going to affect overall development on the continent because as long as Germany and England and the Netherlands and Denmark tolerate non-conformism, it doesn't matter. But these are large chunks of the world and of course, the biggest player in all scientific and technological progress is the United States, and I see in the past decade or decades, a growing lack of tolerance in the United States for non-conformists. The so-called cancel culture which everybody's been talking about the last few weeks is just a little manifestation of that, but it's been around there for a while. Now, I don't think it will catch on, but it is a source of concern to me. Apart from that, as far as new ideas are concerned, we're doing okay, but that is a source of concern. You don't want to be in a world in which there's some kind of stigma attached with thinking outside the box. And remember, of people who think out of the box, 99 out of 100 are crackpots who will end up on the dustbin of history. There's one who's going to end up like Spinoza, but we don't know which one, so you have to tolerate all 100 to get your Galileo or your Copernicus or your Einstein. That's what's happening. And society is full of bad ideas, and the system sort of filters these out. But since we don't know ex-ante which ideas are going to be bad and which ideas are good, you have to tolerate everybody who's making crazy claims.

 

MT: That's a very important point that you made about how it could be one person out of a hundred. Another thing that I learned from you is that technological and scientific progress is really carried forward by a very small percentage of people, maybe two or three percent of people. Now, here's why I think it's interesting and why it's important: there's a very good psychology professor in Australia called William von Hippel. In a recent book called The Social Leap, he talks about how eccentricity and original thinking are very often wedded to eccentric behavior and also disagreeable behavior, so that many people who have the cojones to say to 99 percent of humanity, “No. I want to take this particular area of study in a completely different direction. To hell with all of you,” are also people who are highly eccentric and very often highly disagreeable. So I think that political correctness can work its negative magic in two different ways: one is to stop people from speaking out, but the other one is that it may weed out of the employment pool a lot of people whose quirky personalities do not necessarily fit the majority’s preferences. Would you agree with that?

 

JM: Yeah, I would agree with that, and I think the degree to which society tolerates some people is a main determinant of how successful it is in creating new ideas. I’m not 100% sure that all people who come up with major innovations are necessarily disagreeable, though I can think of some people who fit that description. Isaac Newton was a total jerk, but he was brilliant. 

 

MT: I’m not implying, obviously, that this is 100%.  

 

JM: No, of course, and I think you're absolutely right. Even the people who were not disagreeable were still eccentric in some way typically. So I think that's absolutely true, and I think that's why it is so important for society to stress these issues of free speech and tolerance. If somebody says something that you strongly disagree with, and that's most of what I read in the paper, just forget it and let them speak. Shutting people up or even taking any kind of sanction against them seems to me totally counterproductive because neither I nor anybody else knows whether some crazy idea may eventually lead to something really great. That's just the way human culture. Imperial China was sort of the ultimate example because they developed this fiendishly efficient tool to create a conformist society, which is the imperial examination system. Everybody who wanted to get ahead of the world in China had to take the examinations, and the material for the examination was very well-defined. There were five classics, and everybody had to study those, and you just sat there, and you learned them by heart and then you took an exam, and the exam tested you on how well you had absorbed this material. So basically, very few people deviated, and those who deviated often founded themselves in the claws of what they call the literary inquisition. The same was true for in slightly different forms for Jewish society, so this seems to be quite common, and one of the challenging challenges is to try to see why and how societies become more tolerant of other people's ideas and basically take a “live and let live” kind of attitude because that is a cultural prerequisite to successful creativity.

 

MT: So in the last 10 minutes, I want to turn to last two questions and to take our conversation away from ideas in general to ideas and COVID in particular. So let's look at COVID and human response to it. How would you compare it with past historical instances of pandemics? What do we have to combat a pandemic that our ancestors didn't? In what different ways are we ahead of the game? I know it's an easy question to an economic historian such as yourself, but I think that when people are so pessimistic around the country, they need to see some silver linings.

 

JM: Well, the silver lining, of course, is that if this pandemic had hit us even a hundred years ago, as it did in certain ways with the Spanish flu, it would have been a real disaster. When the Spanish flu hit in 1918, medicine had advanced a bit in the previous century, but they had no clue what it was. The very concept that this was caused by a virus wasn't actually proven until 1933, 15 years later. People had no idea what it was. When COVID hit, a month after first hit we had sequenced its DNA. We knew exactly that there was asymptomatic transmission, which is difficult. That's what's doing all the trouble. If we didn't have asymptomatic transmission, we'd be fine. This is a particularly nasty virus, but we know what it is and we you've got scores and scores and scores of brilliant teams all over the world  - in China and Australia and England and the US and Russia - trying in competition to figure out a bunch of things about this virus: how to test pretty cheaply and effectively, if we can cure the symptoms, and, of course, the ultimate holy grail, the vaccine. Now, it's going to be hard, but one of the things that I think is quite clear from the history of technology is that what often counts is what we call focusing devices. When the world is faced or some subset of the world is faced with a well-defined, clear-cut problem, they are going to use their best minds to crack it, and the speed at which they crack it is a function of the difficulty of the problem compared to the intellectual abilities of the people solving them. So smallpox was something people in the 18th century were obsessed by. They were scared of smallpox and for very good reason. They were trying this and they were trying that. There's a whole literature, now obviously only read by historians of science, that deals with this and at some point, though in this particular case, it was kind of a lucky stroke, they hit upon the vaccination process in 1796. The same happened with polio in the 50s when you got a whole bunch of people worried about this, and two guys, Salk and Sabin, eventually crack the problem and they become celebrities. I can give you more and more examples. It's not just in medicine. It's all over the place. How to fix nitrogen from the atmosphere, how to measure longitude at sea. These are well-defined problems. Not all technological progress comes in that package. Some of it is people coming up with a solution in search of a problem. Oh, we've got this nice thing here. What can we do with it? X-rays, lasers, and so on. But in some cases, the problem is well understood, well-defined, and you put the best minds on it. Now, with COVID, I think we today have the tools that even 15 years ago, let alone a century ago, people wouldn't have dreamed about. It's not just sequencing DNA. It's molecular immunology at an absolutely astonishing level of detail, coupled to extraordinarily powerful computers that allow you to simulate and solve equations that you couldn't ever solve and process vast amounts of data. So as far as I’m concerned, it's just a matter of time. This virus has vulnerabilities. We haven't fully found them yet, but it's impossible that we will not find them. Once we have found the vulnerabilities, we will exploit them. I think the smart money is betting that within a year, we will have not one but three vaccines, none of which may be perfect. That's the problem, of course, but we will be making vast progress. Now, you compare that with the Black Death in 1348. They didn't have a clue. This was the wrath of God. This was the doing of the Jews. The Black Death continued to ravage Europe for centuries, and nobody had the faintest idea what caused it and what transmitted it. They did have some kind of intuitive notion that it was contagious, and so they did come up with this notion of a quarantine and putting a cordon sanitary around cities where it broke out. That helped a little bit but not quite enough. We have a level of knowledge of cellular and molecular microbiology, immunology, virology and so on that nobody has had before. And so I think it's just a matter of time until we crack it. The reason this an economic and social problem in my view, and this not going to make me very popular, but we have been spoiled. We have been incredibly spoiled. Even a century ago, the probability was that if you were to die, you were going to die of infectious disease. Infectious disease killed people left, right, and center because there was nothing you could do about it. You could try to prevent it, but once you got pneumonia or polio or something like that, there was nothing doctors could do for you. That of course all changed and by now, if you look at the cause of death, even with COVID but certainly before COVID, infectious disease is like six on the list of causes of death. It’s heart disease. It's cancer. It's homicide. We don't have infectious disease. We’ve become very complacent about it. I’ll take my flu shots, but it wasn't on anybody's mind. So this is very disturbing to us because we had thought that this was a matter of the past, and now nature is throwing this thing at us. Where did that come from? Who knew that this could even be a problem? Well, if you lived in Africa, you might have still be worried about infectious disease, but in the United States or in the Western world, nobody died of infectious disease anymore. People are really getting to be quite neurotic about it. Now to put things a little bit in perspective, the number of people who die in the United States every year is about two and three quarters of a million people. That's just normal mortality. I think the mortality rate is 0.8 to 1%, so you multiply that by 335 million people, that's what you get. And so if you look at the total number of people who have died of COVID, it's a small fraction of people who would have died anyway. Yet we have paralyzed our economy for that, and maybe that's the right thing to do. Maybe we value the people who have died and wouldn't have otherwise died. That number could be under 50,000 people. We put enormous value on their lives. But clearly if this had happened in 1860, people would have shrugged it off. Oh well, it's just normal. This is what happens. But for us, this no longer normal. We have become very complacent about an infectious disease, and that may have been a misjudgment. maybe nature has some surprises for us. It does everything every once in a while. I’m old enough to remember the breakout of HIV in the 1980s. That was pretty bad. Now, HIV was confined to a certain subset of the population, and if you didn't belong to those subsets, the likelihood of getting it was very low. But it was a serious concern. And then Ebola came around, and every once in a while, nature throws something like that out at us, and my view is it will continue to do so because these microorganisms evolve. Maybe they jump from animals to us, but viruses evolve quite rapidly, and they're evolving the direction that's meant to hurt us because that's what Darwinian theory predicts. So you have this incredible race between evolution and knowledge, but knowledge is growing faster than evolution, and if I had to bet, I would bet on knowledge. Now, it's never going to be a complete victory. Nature will always come up with something new. But every time it does so, we will be better at beating it because we're learning a lot from the COVID thing that will be useful for the next epidemic, which may be a totally different kind of thing. Maybe Ebola. Maybe it will be some mutation. Maybe somebody will unleash smallpox. I hope not, but that could happen. There could be some bacterial infection. Who knows what still could happen, but we’ve learned so much from the war against COVID that will then help us to adapt to the next pandemic. So we'll never be 100% in the clear, but each time we're doing better. 

 

MT: And knowledge is cumulative, and it is very difficult to wipe out all of knowledge.

 

JM: Exactly. It's cumulative. It's stored, so even if you don't have it, you can find it because our search engines have become so much more powerful. You don't have to go to the library and spend three years looking for books. You push a button, and it pops up on your screen. That too is incredible. I could talk about that for hours because I’ve written about this. What you just said is actually enormously important because not only is it cumulative, it has become more accessible. It's not enough that the knowledge exists somewhere. You need to be able to know that it's there, find it, and then get somebody to translate it for you if you don't speak the language. All of those things have become incredibly easy today with the internet, and that makes me very optimistic about this in the long run. Now, this is going to be really difficult for the next year or two or maybe even a bit longer, but this is not going to be the Black Death, and it is not going to be smallpox, and it's not even going to be the Spanish flu. The Spanish flu did kill 50 million people around the globe. The Spanish flu was a big deal, but I’m reminding everybody that two or three years after the Spanish flu was over, we went to the roaring twenties, and everybody was busy buying radios and automobiles, and the whole Spanish flu was forgotten really quickly. My sense is that within a few years, much as this at the moment difficult, this is a temporary thing. This is going to pass, and the fundamentals of the economy haven't changed. Yes, a lot of restaurants may go out of business, but the chefs that were cooking for them will open a new restaurant. Maybe American airlines will go out of business. I hope not, but it could happen. Then somebody else will open a new airline. It’s like a forest fire. After the first day, you come out and say, “Oh my god. The trees are gone.” You come back a year or two later and you realize things are sprouting up, and within a very short time, you have another forest. It may be in fact better than the previous forest. One of the things that we are learning now -- and I think this is actually quite important -- is that telecommuting or work from home has become much more feasible now. You can sort of see that that's not just good for the world of COVID, that's good for lots of other things, including air pollution, the cost of commuting, multitasking, you name it. Not everybody can do it. I fully understand that not everybody is a college professor. It's totally clear that if you need to go to the dentist, it's still not going to be very helpful. Telemedicine may not work for a dentist, but it will work for more and more things and that actually may create a work environment that is far more user-friendly.

 

MT: So to close things up, would it be a right to summarize that you are optimistic about us finding a cure to COVID and you're optimistic about the future of humanity and its economic growth so long as we continue to pursue new knowledge without having free thought and free speech being restricted by anything, from dictatorships to political correctness? Knowledge is key and even if it is created by some very eccentric and perhaps even disagreeable individuals, we should embrace them and let them flourish.

 

JM: I think that's absolutely true and in that regard, I think the market for ideas is like any other market. What you want is easy and cheap entry, easy and cheap exit, and lots and lots of competition. The last thing you want in the market for ideas is a monopolist like Comrade Stalin or like the Catholic church in the Middle Ages or anything in between. It's not an efficient market in the sense that it produces a lot of garbage. It produces a lot of bogus ideas, but that's why it's a market. If the ideas are bogus, eventually one hopes they will be weeded out. That doesn't happen quite as fast and as often as one would hope, but there’s really nothing you can do about that. It's an evolutionary process, and evolution throws up a lot of duds, but as I said earlier, in the end it works. I’m much more of a technological optimist than I am an institutional optimist. I think there is reason to be concerned about the political course. I'll tell you this little anecdote. One of my great professional friends was the late Douglass North, who won the Nobel Prize for Economics in 1993, and one day Doug and I were drinking beer at his summer home in Michigan, and Doug said, “Joel, something interesting we do in economic history is we talk about technological progress, but we talk about institutional change.” And that is significant because knowledge, as you said earlier, is cumulative, so it does move ahead because we know what previous generations do. Institutions get better and they get worse. There is nothing in history that indicates that there is a trend toward better and better institutions. There have been times when they absolutely got better, but if you look at the 1920s and 1930s, that was not the case. Then after World War II, things got better, and maybe the last 20 years have not been so great. 

 

MT: You were talking about how the wisdom of the ancients is very often wrong, but I think that Aristotle was onto something when he said that human society can basically function along three different dimensions: it's either a democracy, it's oligarchy, or it's a dictatorship. It seems to me that we are on a pendulum going from one to the other, but we never get out from that three-pronged view of institutions. Am I right or wrong?

 

JM: Yeah, I think there's probably some truth to that. I would say there are a lot of intermediate cases, and living at the time that he did, he could never quite envision what we invented in the 20th century, which is totalitarianism, which of course couldn't exist in in those days. But I think you're absolutely right, and I think we don't quite fully realize until the last 20 years that the institutions we have, which is an open liberal democracy, a civil society, and a rule of law, are far more fragile than we've ever seen. We sort of think this is the natural thing. Once communism fell apart, it was the end of history. We're all going to be liberal democracies, and that's not happening. Liberal democracies are turning away from liberal democracy, some countries faster, some countries slower, but we both know where it's happening and how fast it's happening. Look at places like Brazil or China for that matter. A scary scenario is a world in which technology gets better and better and institutions don't, and the gap between the two gets bigger and bigger. And what you are going to have is a humanity with incredible capabilities but a bad judgment of using them, and that could be a scary scenario. We see some of that happening, social control and suppression of dissent by technological means. Look at what's happening in China especially, but it's happening in lots of countries, and it could happen here. I worry about that. The last 20 years have been hard for an optimist.

 

MT: Professor Mokyr, thank you very much for giving us an hour of your time. This has been absolutely terrific. 

 

JM: Thank you. It was my pleasure. 

Joel Mokyr is an American-Israeli economic historian and a Professor of economics and history at Northwestern University. Marian L. Tupy is a Senior Fellow at the Cato Institute's Center for Global Liberty and Prosperity and the editor of HumanProgress.org.
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