A behavioral approach to the political and economic inquiry into the nature and causes of the wealth of nations
AbstractDeirdre McCloskey’s Bourgeois Dignity (2010) represents another breakthrough work in her career, and the second volume in a multi-volume work on the economic and intellectual history of western civilization. In a sense, the subtitle of the book explains well what this volume is all about--why economics can’t explain the modern world. An important modifier would be – modern economics can’t explain the modern world – because much of what McCloskey argues is the resurrection of an older argument that was associated with classical liberal political economists from Smith, Bastiat, Mises, Hayek and Friedman. Fundamentally, she reasserts the power of ideas to shape the world. McCloskey’s narrative is simple and compelling -- materialist stories (whether technological, genetic, or institutional) do not work; incentive based stories do not provide a complete picture of why some countries grew rich while others remained poor, let alone for the exact timing for the divergence in the wealth and poverty of nations with the Industrial Revolution in the 18th and 19th century. McCloskey proposes that incentive based explanations must reside within a broader narrative that addresses values and beliefs, as well as institutions, technologies, and material conditions. In doing so, McCloskey paves the way for a true behavioral approach to a political and economic inquiry into the nature and causes of the wealth of nations.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 32376.
Date of creation: 2011
Date of revision:
Economic History; Economic Development; Industrial Revolution;
Other versions of this item:
- Boettke, Peter, 2012. "A behavioral approach to the political and economic inquiry into the nature and causes of the wealth of nations," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 41(6), pages 753-756.
- O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General
- N00 - Economic History - - General - - - General
- P10 - Economic Systems - - Capitalist Systems - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-08-02 (All new papers)
- NEP-CBE-2011-08-02 (Cognitive & Behavioural Economics)
- NEP-HIS-2011-08-02 (Business, Economic & Financial History)
- NEP-HME-2011-08-02 (Heterodox Microeconomics)
- NEP-HPE-2011-08-02 (History & Philosophy of Economics)
- NEP-PKE-2011-08-02 (Post Keynesian Economics)
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