Macroeconomic Theory: History and Outlook

“This is the way of the world: what has long been divided must be united, and what has long been united must be divided.” This opening quote from the Romance of the Three Kingdoms, the classical Chinese novel written in the fourteenth century, illuminates the vicissitudes of life, and the seemingly simple sentence is truly thought-provoking and enlightening. Human civilization can be roughly divided into Eastern civilization and Western civilization, both of which have created miracles and have their own advantages and disadvantages. In general, what primarily sets the two civilizations apart is the emphasis on union or division. Western civilization, marked by division, is more focused on “yes or no,” while Eastern civilization, centered on union, emphasizes “balance.” The models fitting with the social development stages influence the characteristics and progress of civilization. In comparison, division is more characteristic of a slave society or capitalist society. Western civilization has reached a higher level of development, while Eastern civilization largely boomed in feudal society. The US in the nineteenth century had the dual features of slavery and capitalism, but capitalism later took hold.