March, 2017

A Combustible Combination

McCloskey on Ideas, Institutions, and Economic Performance Through Time
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Find the paper online at SSRN.

McCloskey’s Bourgeois Equality explains the Great Enrichment of man beginning in the early 19th century as being caused by what we refer to as a “combustible combination” of ideas, institutions, and commercial practices. Economic growth for McCloskey is not just a function of the security of property rights, as her critique of Douglass North’s depiction of the Glorious Revolution indicates, but the increasing the scope of market exchange brought about by the spread of Bourgeois ideas. The ability of a society to realize the gains from productive specialization and mutually beneficial exchange, as well as the benefits of peaceful social cooperation among diverse peoples is made possible only through the adoption of ideas that legitimate and institutions that recognize the universal dignity to commercial practices such as capital accumulation, trade, and entrepreneurship.