Notes and quotes from Joel Mokyr's "Lever of Riches"

  • Economic growth can happen in one of four ways: 1) Solovian growth where capital accumulation occurs at a faster rate than growth of the labor force so each worker has more capital to work with, 2) Smithian growth where there is increase in trade, 3) Scale or sizing effects, or 4) Schumpeterian growth, that is, capitalist expansion deriving from continuous though fluctuating, technological change and innovation financed through the extension of credit
  • Economists typically approach the explanation of technological change by considering the relationship between demand and supply variables, research and development and productivity growth. In doing so, the implicitly treat technology as an input.
  • Standard economic theory deals with rational choices subject to known constraints faces a dilemma in dealing with technological creativity. Technological change involves an attack by an individual on a constrain everyone else takes as given.
  • An interesting distinction that is applicable to innovation comes from biology. Some biologists distinguish between micromutations, which are small changes in an existing species, and macromutations which create entire new species. Even though Mokyr extends this to talk about microinventions and macroinventions, I think it is much more useful to talk about microinnovation and macroinnovations.
  • Given the difference between the standard of living in the West today and three centuries ago, I find criticisms of Whiggishness easy to ward off. p 15
  • If there is a lesson to be learned from the history of technology it is that Schumpeterian growth, like the other forms of economic growth, cannot and should not be taken for granted. p 16
  • Technological progress in Roman times served the public rather than the private sector. The roads were built for the military, not for commerce. They were steeply graded, proving too cumbersome for commercial loads. p 21
  • What we do for ancient civilizations is tantamount to reconstructing modern society on the basis of a few buildings and paintings. Because most of the items were made of leather and wood, a lot has not survived. p 27
  • When classical civilization succeeded in creating a novel technique it was often unable or unwilling to take it to its logical conclusion and to extract anything approximating the maximum economic benefit from it. Many inventions that could have led to major economic changes were underdeveloped, forgotten, or lost. p 29
  • As Lynn White has remarked, medieval Europe was perhaps the first society to build an economy on nonhuman power rather than on the backs of slaves and coolies. p 35
  • The clock not the steam machine, writes Mumford with some exaggeration is the key machine of the modern industrial age. It is mechanical, automatic, and demands a high level of precision in design and maintenance and thus served as an example of all other machinery‚Ķ Clock brought home differences in efficiency: more productive workers and better implements and tools could be seen to produce more output per hour. Productivity comparisons became easier and with them the choice between the faster and the slower. p 51
  • It may well be true as Alfred North Whitehead said that as far as science was concerned that Europe knew in 1500 less than Archimedes knew in 212 BC. As far as technology is concerned this assessment is false. By 1500, Europe had advanced further than known before. Although they might not have been more enlightened, they were incomparably better at producing the goods and services that determine material living standards. p 55
  • Between 1500 and 1750 there was no shortage of innovative ideas, but the constraints of worksmanship and materials made it a binding reality.
  • Paddle wheels boats, power looms, calculating machines, parachutes, fountain pens, steam operated wheels and balls bearings had no economic impact because they could not be made practical. p 58
  • Innovation remained a lively force but its effects on productivity came only slowly. It may well be that most of the increases in labor productivity in eningeering industries and mining were the result of better tools, economies of scale, and a more efficient organization of labor. p 66
  • The Industrial Revolution became possible when mechanics and machine tools could translate ideas and blue prints into accurate and reliable prototypes.

First published Mar 10, 2012