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Liberal Ideas and the Great Enrichment: A Theoretical Model

Author

Listed:
  • Heng-fu Zou

    (The World Bank
    Institute for Advanced Study, Wuhan University
    China Economics and Management Academy, Central University of Finance and Economics)

  • Wei Liang

    (China Economics and Management Academy, Central University of Finance and Economics)

Abstract

We explores the intricate relationship between culture, liberal ideas, and economic growth, presenting a formal framework to better understand the drivers behind the Great Enrichment. It highlights how core values such as liberty, dignity, equality, and individualism play a pivotal role in enhancing human welfare and fostering technological innovation. By delving into these liberal principles, the study sheds light on the mechanisms through which societies can achieve sustained economic development.

Suggested Citation

  • Heng-fu Zou & Wei Liang, 2025. "Liberal Ideas and the Great Enrichment: A Theoretical Model," CEMA Working Papers 737, China Economics and Management Academy, Central University of Finance and Economics.
    • Handle: RePEc:cuf:wpaper:737
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    References listed on IDEAS

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    1. McCloskey, Donald N, 1983. "The Rhetoric of Economics," Journal of Economic Literature, American Economic Association, vol. 21(2), pages 481-517, June.
    2. Romer, Paul, 1993. "Idea gaps and object gaps in economic development," Journal of Monetary Economics, Elsevier, vol. 32(3), pages 543-573, December.
    3. Wei Liang & Heng-fu Zou, 2024. "Endogenous Constitutional Democracy Capital and Economic Development," Annals of Economics and Finance, Society for AEF, vol. 25(2), pages 501-549, November.
    4. Aghion, Philippe & Howitt, Peter, 1992. "A Model of Growth through Creative Destruction," Econometrica, Econometric Society, vol. 60(2), pages 323-351, March.
    5. Francisco J. Buera & Ezra Oberfield, 2020. "The Global Diffusion of Ideas," Econometrica, Econometric Society, vol. 88(1), pages 83-114, January.
    6. Gene M. Grossman & Elhanan Helpman, 1993. "Innovation and Growth in the Global Economy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262570971, December.
    7. Romer, P.M., 1988. "Capital Accumulation In The Theory Of Long Run Growth," RCER Working Papers 123, University of Rochester - Center for Economic Research (RCER).
    8. Francisco L. Rivera-Batiz & Luis A. Rivera-Batiz, 2018. "Economic Integration and Endogenous Growth," World Scientific Book Chapters, in: Francisco L Rivera-Batiz & Luis A Rivera-Batiz (ed.), International Trade, Capital Flows and Economic Development, chapter 1, pages 3-32, World Scientific Publishing Co. Pte. Ltd..
    9. Qixin Zhan & Heng-fu Zou, 2024. "Liberty Capital Accumulation and Economic Growth," Annals of Economics and Finance, Society for AEF, vol. 25(1), pages 63-116, May.
    10. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 71-102, October.
    11. Qixin Zhan & Junzhu Zhao & Heng-Fu Zou, 2025. "The Rule-of-Law Capital,Growth, and Development," Annals of Economics and Finance, Society for AEF, vol. 26(2), pages 667-705, November.
    12. Edmund Phelps, 2015. "Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge, and Change," Economics Books, Princeton University Press, edition 1, volume 1, number 10058-2.
    13. Romer, Paul M., 1990. "Human capital and growth: Theory and evidence," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 32(1), pages 251-286, January.
    14. Peter Howitt, 1999. "Steady Endogenous Growth with Population and R & D Inputs Growing," Journal of Political Economy, University of Chicago Press, vol. 107(4), pages 715-730, August.
    15. Charles I. Jones, 2002. "Sources of U.S. Economic Growth in a World of Ideas," American Economic Review, American Economic Association, vol. 92(1), pages 220-239, March.
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    Cited by:

    1. Heng-fu Zou, 2025. "Institution-Based Asset Pricing: A Generalization of Consumption- and Production-Based Models," CEMA Working Papers 765, China Economics and Management Academy, Central University of Finance and Economics.
    2. Qixin Zhan & Junzhu Zhao & Heng-Fu Zou, 2025. "The Rule-of-Law Capital,Growth, and Development," Annals of Economics and Finance, Society for AEF, vol. 26(2), pages 667-705, November.

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    Keywords

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    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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