A new theory of human progress

For a deeper dive on the subjects addressed here, please check out my new book, In Good Faith: How the Nature of Belief Shapes the Fate of Societies, which is now out and available for purchase!

Fun fact: for a good long while the book’s working subtitle was the rather grandiose “A New Theory of Human Progress”. We ended up using something else (obvs), but that’s still the way I think about the book and its contributions. The theory mostly pulls together and repackages existing lines of research across economic history, cultural anthropology, and evolutionary biology. But the framework that results is truly novel and useful, I think, and provides a new approach to the most important and vexing questions in economics: how do we explain the long march from hunter-gatherer societies to the rich and technologically advanced countries of today, and why have many societies traveled this path more slowly or less completely than the handful of countries at the frontier? I thought I’d share the outlines of this theory here.

There is an enormous economic-history literature on these Big Questions, and I’ve spent the past quarter century grappling with it. If you’re interested in learning more about the different approaches and how they complement/conflict with each other, one good place to start is with How the World Became Rich: The Historical Origins of Economic Growth, by Mark Koyama and Jared Rubin. If you’re looking for something shorter, you could do far worse than watching this recent lecture delivered by Brad DeLong, who I believe is working on a new book focused on these very questions, framed around a concept he calls “Anthology Super-Intelligence”.

I don’t want to speak for Brad, but my impression is that with this new work he is pursuing the same thing I did in my book: a compelling framework through which to explain how society creates and enriches itself. My aim isn’t to adjudicate between different perspectives on how much particular ingredients (like resource endowments, institutional quality, functioning capital markets, and so on) mattered to development. It is instead to make progress toward a better understanding of the underlying process at work and the way that process led to the modern world. It’s the sort of theorizing that’s probably easier for a non-academic, because I can borrow liberally from other disciplines and propose radical overhauls to our ways of thinking about economic history without having to worry about the profession calling me out as a heretic. They can call me other things instead, or ignore me.

I will say that one thread within the economic history literature had a particular influence on me as I worked on the book: the move to reengage with culture as a meaningful economic force. My economics education trained me to ignore cultural arguments, but I have since repented. Actually, this reconciliation began when I was writing The Wealth of Humans, when I dug into a bunch of interesting work (much of it co-authored by Rebecca Henderson) on disruption, culture, and the theory of the firm. But as I was growing more interested in culture I found that a growing number of economic scholars were making respectable arguments about the influence of culture on economic outcomes. Within economic history, two books in particular persuaded me that there is a there there: A Culture of Growth: The Origins of the Modern Economy, by Joel Mokyr (based on a series of lectures), and The Bourgeois Virtues: Ethics for an Age of Commerce, by Deirdre McCloskey.

To get a better grasp on the mechanisms of cultural change, I began reading outside of economics and found a bunch of fascinating work on cultural evolution (and gene-culture co-evolution). There’s so much to say here, but to keep it short: what’s needed, in the economic-history story, is a process through which distributed and undirected activity results in the emergence of high levels of complexity. We have a great framework for that sort of thing, in the form of Darwinian evolution. And over the past half-century or so, people working in biology and cultural anthropology worked out a story about how the biological evolution of our ape ancestors transformed into a self-sustaining process of gene-culture co-evolution, which ultimately yielded complex cultural forms that also evolved. The foundational (if somewhat technical) works here are Cultural Transmission and Evolution, by Luigi Calli-Sforza and Marcus Feldman, and Culture and the Evolutionary Process, by Robert Boyd and Peter Richerson, but as a very readable explanation of what this is all about I highly recommend The Secret of Our Success: How Culture Is Driving Human Evolution, Domesticating Our Species, and Making Us Smarter, by Joseph Henrich.

To tie things together, I needed something else: a plausible model of human behavior which recognizes that we are cultural creatures, but which also acknowledges that we think for ourselves, engage in moral and logical reasoning, and often act purposefully and indeed self-interestedly. A key resource for me here was Identity Economics: How Our Identities Shape Our Work, Wages, and Well-Being, by George Akerlof and Rachel Kranton, which gave me a way to think about how our individual connection to cultural groups shapes our identity and can provide us with an intrinsic motivation to meet cultural expectations.

My framework, in a nutshell

These are the main ingredients of the theory. I described its basic operation in my last post, which I’ll quote here:

In my book, I present belief as a piece of behaviorally relevant meaning shared across a group of people. The meaning provides guidance as to how individuals are supposed to behave. When the members of the group of believers behave according to this guidance, the result is an “institution”, which interacts both with other individuals and other institutions. (An institution might be many things: the legal profession, Methodism, Bills fandom, democracy, etc.)

To be part of an institution is to incorporate that association into your identity. Identifying with the institution creates an intrinsic motivation to behave in the appropriate way (which is what allows these institutions to work, despite the fact that it is individually costly to participate in the institution while many of the benefits it generates are diffuse). There is a mapping, in other words, between a piece of shared meaning, the identities of the individuals that share it, and the institutions they make manifest. Then finally, what an institution does within the broader institutional ecosystem depends upon the nature of the belief shared among its members; different sorts of ideas lead to different institutional behaviors which in turn have different effects on the cooperative and productive potential of society. Oh, and these institutions and the beliefs that support them are subject to evolutionary dynamics.

In the prologue of the book, I summarize the theory in a single line: what a society can be depends, as it always has, on the nature and distribution of belief. But what is it that changes in the nature and distribution of belief do?

This needs to be seen in two different and parallel ways, which both tell us something about what’s happening as we go about our lives.

On the one hand, this unfolds in a way that is legible to us and intuitive. Take a body of belief that is something like: “it is good to try to understand the workings of nature and use this knowledge to improve people’s lives”. This meaning is an important part of the foundation of modern economic growth. It is something that had to be discovered. Early humans adapted to their environments through a slow process of cultural evolution, and survival meant hewing as faithfully as possible to inherited tradition: concerning how to find and prepare food, prepare defenses against the elements, and fend off threats, among other things. Still, there would often have been individuals who observed regularities in nature and thought of finding ways to turn those regularities to better advantage. As societies grew larger, the chances of groups of such people finding each other would go up, and communities of innovation would emerge here and there.

But if “tinkering for good is a worthy activity” became a belief shared across a significant share of society, then that society might become capable of feats of invention and growth that no prior society could match. Large communities of people sharing this belief could form innovation-oriented institutions, which alter the cultural and economic landscape. We can understand this mechanism — how you get from belief to different individual behavior to different aggregate outcomes — and we can engage in study of historical materials to see whether this happened and how and when. We can think and reason about it, and we can have purposeful discussions about actions we could take that might make this belief more powerful while also minimizing negative side-effects of it.

Yet on the other hand, there is something else happening which we can’t easily observe or understand. Human societies process information. They receive information from the world around them, they decide how to respond, and the actions they take yield particular outputs. Culture shapes this information processing. An evolved tradition which supports a division of labor may enable more effective cooperation within a group, such that the same number of people confronting the same incoming environmental information can generate superior outputs: like better nutrition and more population growth, for example. The evolving tradition may increase the amount of information that can be stored within a society. It may also alter interactions within the society so that more can be done with the information available.

So suppose we have an area where many independent clans occasionally bump into and interact with each other. Suppose that some of these interactions result in ritual behavior that makes the clans involved more eager to find regular ways of meeting up. (This could be as simple as: hey, the last two times we bumped into you all, we shared our food around a fire and told stories, that was cool, let’s do it again three moons from now.) Through repetition of this tradition and cultural evolution, the group of clans which come together could begin acting as a social unit in its own right: call it a tribe. And maybe new subgroups emerge within this tribe: like a priesthood, say. See what has happened here. The broader tribal society has many more nodes than the individual clans had, and these nodes can be grouped together in more interesting ways. The amount of information this social system can store has gone up, and the complexity of the operations that can be carried out on this information has risen dramatically. It’s a more powerful social computer. And as cultural evolution continues, experience can tune different elements of this system: strengthening some connections between nodes and weakening others, developing sub-routines and “institutions” which evolve to play specialized roles. Greater complexity becomes possible, and the overall capabilities of the system increase.

The people within such societies may be mostly or entirely unaware that this is what’s happening. They see themselves as simply navigating established norms and practices as they go about their lives. They have no idea that they’re helping to manifest complex information processing, and they could not begin to describe what the system is doing and how it’s doing it. In a process that is largely distributed and undirected, the evolution of belief can increase the size of a computational system, and adjust the rules according to which information is shared and processed within it.

There are two parallel layers, we are all active within both, and it is through the interplay of these forces we have come to achieve astounding levels of social and economic complexity.

The Great Divergence and the role of Christianity

Let’s consider one important example of this operating at grand scale. Across most of human history, most societies have been structured around kin-based networks. As societies scaled up, they generally did so by finding ways to align the interests of different networks through careful planning of marriages. A society like this can become large and enduring and capable of supporting social and economic complexity. It is also inflexible in a number of different ways. Conducting social or economic business across clans can be difficult, and both law and morality are contingent on kin-group associations and are not universal. To thrive within these societies, individuals need to prioritize kin-group interests. This seems to encourage a communitarian psychology, which is less individualistic and potentially more compatible with authoritarian forms of government.

The psychology of individuals living in the rich west seems to be very different. Values and laws are seen as universal, people are more trusting of strangers and more individualistic. Why? Joseph Henrich argues that a key change occurred in the societies of western Christendom over the course of the first millennium CE, when the church began altering its views on family-related doctrine. Ultimately, the church disallowed marriage between cousins, as well as sororate and levirate marriage (when a person marries their dead spouse’s sibling). This dissolved the glue holding kin-based structures together. As a consequence, the nuclear family became more important than the extended clan, and the moral code governing society gradually became less kin-contingent and more universal. Individualism flourished, and kin-based institutional structures were replaced by a menagerie of voluntary organizations: various guilds and orders and societies, universities, free cities, and so on.

In a new book, which came out after mine had gone to press, three outstanding economic historians — Avner Greif, Joel Mokyr, and Guido Tabellini — take Henrich’s argument further. In Two Paths to Prosperity: Culture and Institutions in Europe and China, 1000–2000, the authors identify the European move away from kin-based networks as the key to the Great Divergence. From around 1000 CE, they argue, the demand for greater provision of local public goods increased in many societies. Underlying cultural differences between kin-based societies like China and the more individualistic Europe shaped the response to this need, causing a significant divergence in the institutional and economic trajectories of Europe and China. Their story ascribes a role to culture; as people formed organizations to cooperate on the basis of shared belief (as opposed to kinship ties) powerful new entities were created whose role in society could evolve over time. This, ultimately, enabled the march to modern economic growth.

The work these scholars are doing is important, and in my view it moves the social sciences closer to a real understanding of the Great Divergence. Just last year, Mokyr was a co-winner of the economics Nobel, but I still feel that his contributions are undervalued by his peers. At the same time — fully understanding the intellectual arrogance this suggests — I think there is a better way to conceptualize the processes the scholars above examine. I’m unhappy with the way culture is smuggled into what is ultimately a pretty standard application of economic analysis; it undersells both the power of culture in shaping economic outcomes and the historical importance of people exercising their individual agency in the pursuit of something other than optimization. And I’m really unhappy with how much of this story rests on the church’s family policy, which is basically presented as an exogenous shock.

Let’s once again look at the two parallel layers. On the one hand, we have the intuitive, observable story. We have, in the ancient near east, a roiling mass of beliefs and identities, and within this mass we see the slow emergence of novel ideas, some clearly ancestral to the notion of a universalizing morality, as well as to the moral autonomy of the individual. These ideas are already shaping history in the first millennium BCE, and elements of them are distributed across the people of the region. Amidst the roiling, these ideas combine and recombine in various ways, and one particular synthesis takes hold in the early centuries of the first millennium CE, thanks to the devoted — indeed, fanatical — work of early adherents to the Christian faith.

It seems perfectly plausible to me that the Christian church’s family policy acted as an accelerant to the moral change underway, but I think we can give Christianity a little more credit. As I write in the book:

[W]e clearly see ideas ancestral to [modern, Western] psychology throughout the philosophy and religion of antiquity, and it would be strange to assume that the evolution and diffusion of these ideas were unrelated to the emergence of a unique Western psychology with attributes extremely complementary to those ideas.

It would be especially strange to do this with respect to Christianity itself. The Jesus of the New Testament preached a duty to care for others, regardless of their tribe or religion or wealth or reputation. He encouraged people to devote themselves to God, to leave behind old lives and obligations and build a new community of brothers and sisters in Christ. It may well have been the case that large-scale changes to mass culture that moved Christendom as a whole in this direction were facilitated by church dicta, which weakened the old social order built around clans and tribes linked by kinship and marriage. But to conceive of this broader social and moral evolution as something more or less accidental — an unanticipated consequence of quite unrelated prohibitions around sex — seems to undersell the power and appeal of Christianity, and for that matter the agency of human individuals.

So on the intuitive level, we have this clear moral arc. Cultural evolution in the near east led, ultimately, to a particular moral insight and a subsequent moral revolution. People were active participants in this revolution, because they found something in the faith worth embracing, despite the threats to life and property Christians often faced in the early first millennium CE. They came to see themselves as individuals subject to a universal moral code, with the obligation to do good for good’s sake and treat all others well. Over time, behavior across society changed, new ways of thinking and coming together became possible, and this — this evolving conception across society of what people could and should be — created the conditions in which scientific and commercial and industrial revolutions could occur.

As humans, we should be willing to allow ourselves to accept that what we believe matters, that our convictions matter, even if economists are determined to tell us that they don’t.

Then there is the second layer. The people living in Europe and the near east over the past few thousand years were simply going about their lives in a messy world, drawing on the beliefs around them to navigate the challenges they faced. But they were also nodes in information-processing networks. As their beliefs evolved over time, the kinds of connections that could be made changed. Critically, the replacement of a rigid world constructed out of kin relations by one of a diverse ecosystem of organizational forms made up of like-minded individuals dramatically increased society’s processing power. A single person could inhabit many different identities — relating to craft and occupation, sect, association with a particular city or region, nationality, personal interest, or a host of other things — and could thus help to sustain many different institutions, all playing different roles within the information-processing network. The combinatorial possibilities far exceed what is achievable within a kin-network society. And as history tunes the connections and weights of the nodes and the institutions in the system, more powerful structures still emerge, and the complexity that it can support increases.

Today, we allow ourselves to see some aspects of society in this way. When economists talk about the information-processing power of markets, and their ability to aggregate and make useful lots of distributed information, they are very close to getting it (and some, like Friedrich Hayek, certainly understood). There are thinkers around who extend this thinking to other spheres of society and other institutional “black boxes”, within which the actions of people guided by their particular cultural codes yield outputs whose construction we can’t fully understand. This, though, is how we should see all of society. This is how you get order out of chaos, how societies create themselves. You want to know what our world is made out of? It’s made out of people behaving according to beliefs shared across sub-groups of society, forming institutions with their own emergent properties. Over time and under evolutionary pressure, these institutions interact with others to create larger information-processing structures, until there is an entire hierarchy of structures at work, manifesting complexity that is incomprehensible to us — for now. But not forever. Many other natural systems work in this way, including the human body. We will come to understand these complex systems better, and as we do we will discover new and remarkable technological capabilities.

Right now, this is a bad theory with enormous potential. There are many, many details to be worked out, and critical parts of my story will turn out to be wrong. I’m sure that there are ways of capturing the critical mechanics of this framework more parsimoniously. I am certain that if and as the theory is prodded in different ways — through qualitative historical work and computer simulations, especially — my approach will be wholly displaced by others. Nothing would make me happier. At the end of the day, this story is the best answer I’ve come up with to a question that has occupied my thoughts for more than half my life. I wrote the book hoping that others might run with it, build on it, and get us all closer to a deep understanding of the nature of human progress.

Further reading: In Good Faith: How the Nature of Belief Shapes the Fate of Societies