Theology and Economics: The Causes of Prosperity

[After a brief respite, I am picking back up with my months-long Theology and Economics series.]

I began this series by noting that poverty is the natural human state of affairs. When we ask, “What causes poverty?” the answer is “Being born.” We all come into the world owning nothing. The fact is that most people in most cultures throughout most of history have lived lives owning very little. Their lives were endless cycles of disease, famine, and war. Only small minorities prospered beyond bare subsistence living. Even at the height of the great Roman Empire, maybe ten percent of the people moved beyond subsistence living. Grinding poverty and premature death have been the norm.

The real question is, “What causes prosperity?” Widespread prosperity across entire societies is a startlingly new development within human history. It began a few centuries ago but has dramatically accelerated over the last 300 years. Infant mortality rates (the number of children who die before their first birthday out of every 1,000 children born) have been 200-300+ throughout human history. There are now only a few nations where this rate is in triple digits, and most rates are much lower. During the twentieth century in the United States, the rate dropped from 165 to 7. Life expectancy from birth in the US has risen from about 47 years to nearly 76 years over the same period. Entire diseases have been eliminated across the planet. Access to varieties of food, healthcare, climate-controlled homes, rapid transit, and a host of other amenities are available to hundreds of millions of people that would be the envy of the very wealthiest people a century ago. This prosperity continues to expand (though unevenly) all across the planet. The real question is, what brought about this prosperity?

Some claim that the prosperity of a few has come at the expense of others. There is no question that wealthy nations have exploited others on their road to prosperity. In some cases, the wealthy unjustly dominated destitute nations and failed to lift them into prosperity. This is a valid critique. However, it is not true in most cases to say that prosperous nations caused the poverty of poor nations when poverty was widespread before the exploiters ever arrived.

Several economists have examined “the causes of prosperity” from different angles. I will review the conclusions of William J. Bernstein in his highly accessible The Birth of Plenty: How the Prosperity of the Modern World Was Created. Then I will look from the religious-historical perspective offered by Rodney Stark in The Victory of Reason: How Christianity Led to Freedom, Capitalism, and Western Success. After that, I will reflect on what this means for Christians today.

For now, we turn to a brief review of the four factors that Bernstein believes have fueled the unprecedented economic growth during recent history:

• Property Rights
• Scientific Rationalism
• Capital Markets
• Technology and Infrastructure

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Comments

[Dana Ames]

I am intrigued with your line of thought. It is indeed obvious that poverty is the norm. Looking forward to your posts.
Dana

[Michael Kruse]

Thanks Dana. I hope they will be worthy of your time.

[Rob Boldt]

Just found your blog and am intrigued. Another good resource on property rights/law as a catalyst or inhibition to prosperity is The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else by Hernando DeSoto.

Thanks,
Rob Boldt

[Michael W. Kruse]

Thanks Rob. I love DeSoto's book. Great stuff. Glad you stopped by to comment.

[Percival]

Just read an article from CT on Anne Rand by Gary Moore. Are you familiar with him or the "Good $ense Movement"?
Thought you might want to blog on it.