The New Humanities

historical origins of the knowledge economy
(Princeton University Press: 2002)

“The growth of human knowledge is one of the deepest and most elusive elements in history. Social scientists, cognitive psychologists, and philosophers have struggled with every aspect of it, and not much of a consensus has emerged.... [However,] the central phenomenon of the modern age is that, as an aggregate, we know more.... Useful knowledge, as employed [here,] describes two types of knowledge. One is knowledge ‘what’ or propositional knowledge (that is to say beliefs) about natural phenomena and regularities. Such knowledge can then be applied to create knowledge ‘how’, that is, instructional or prescriptive knowledge, which we may call techniques.... This distinction differs in important respects from the standard distinctions between science and technology, that have produced a vast literature but has increasingly come under scrutiny. It is also different from the distinction between ‘theory’ and ‘empirical knowledge’.... Science, as John Ziman has emphasized, is the quintessential form of public knowledge, but propositional knowledge includes a great deal more: practical informal knowledge about nature, such as the properties of materials, heat, motion, plants, and animals...[and] folk wisdoms, in the ‘apple-a-day-keeps-the-doctor-away’ tradition. Geography is very much part of it...[and] it also includes...engineering knowledge, [which] concerns not so much the general ‘laws of nature’ as the formulation of quantitative empirical relations between measurable properties and variables, and imagining abstract structures that make sense only in an engineering context.... It seems pointless, furthermore, to argue whether components of [propositional knowledge] are ‘correct’ or not, [as] theories and observations about nature may have been of enormous practical influence, and yet be regarded today as ‘incorrect’.... In the end, what each individual knows is less important than what society as a whole knows, and can do.”

(Mokyr, pp.1-7)

There are only three major transitions in the story of homo sapiens. The first is that of settlement, the second the rise of cities/larger territorial units, and the third - the central concern of this book - is the transition into what we (however inadequately) term modernity...a genuinely complex state which we endlessly debate. However, what’s undoubtedly true is that the main driving forces behind the last were primarily ideational/economic (or vice versa), making the genuine neglect of this linkage by economic theorists a serious weakness in our understanding of the modern world. Thankfully, however, enough economic historians/theorists have taken on the challenge in recent years that the subject is now fairly well-illuminated, albeit with a light rather different from the neo-classical orthodoxy. Moreover, the best work on the subject - and subject of this review - also draws significantly on the work of other major scholars familiar to this site - most specifically, Elizabeth Eisenstein, Mancur Olson, and Jack Cohen & Ian Stewart - whilst (unknowingly) also adding new dimensions to the key ideational side of the story, as depicted by Charles Taylor and Stephen Toulmin.

The result, while no easy read, is an argument that makes very real sense of the intricate interplay between knowledge & economic affairs, whilst also revealing a crucially neglected phase in the development of same which transformed our world. Let Joel Mokyr help explain...

“The key to the Industrial Revolution was technology, and technology is knowledge. Economic historians should re-examine the epistemic roots of the Industrial Revolution, in addition to the more standard economic explanations that focus upon institutions, markets, geography, and so on. In particular, the interconnections between the Industrial Revolution and those parts of the Enlightenment movement that sought to rationalize and spread knowledge may have played a more important role than recent writings have given them credit for.... This would explain the timing of the Industrial Revolution, following the Enlightenment and - equally important - why it did not fizzle out...[for,] the true question of the Industrial Revolution is not why it took place at all, but why it was sustained beyond, say, 1820. There had been earlier clusters of macroinvention, most notably in the fifteenth century with the emergence of movable type, the casting of iron, and advances in shipping and navigation technology.... [But,] before the Industrial Revolution, the economy was subject to negative feedback; each episode of growth ran into some obstruction or resistance that put an end to it, [so] growth occurred in relatively brief spurts, punctuating long periods of stagnation and decline. [However,] after such episodes, the economy asymptoted to a higher steady state, creating something of a ‘ratchet effect’. The best known of these negative feedback mechanisms are Malthusian traps...[but] another was institutional negative feedback...[as] prosperity and success led to the emergence of predators and parasites, who eventually slaughtered the geese that laid the golden eggs.... But, perhaps the main root of diminishing returns was the narrow epistemic base of technology, [as] when new techniques came around, often revolutionary, they usually crystallized at a new technological plateau, and did not lead to a stream of cumulative microinventions...[for] too little was known on why and how the new technique worked.”

(Mokyr, pp.29-32)

“Narrow-based techniques rarely led to a continuous stream of extensions, refinements, or new applications...[as] when no one knows why things work, potential inventors do not know what will not work, and will waste valuable resources in fruitless searches for things that cannot be made, such as perpetual motion machines, or gold from base metals.... Beyond that, there is the question of the tightness of knowledge. [Much] may have been suspected to exist, by some people, but as long as they could not be ‘demonstrated’ rigorously enough to convince enough others, the knowledge may not have been tight enough to serve as an epistemic base.... To oversimplify a bit, the Industrial Revolution could be reinterpreted in light of the changes in the characteristics and structure of [propositional] knowledge in the eighteenth century, and the [prescriptive knowledge] and techniques that rested on it. As the two forms of knowledge co-evolved, they increasingly enriched each other, eventually tipping the balance of the feedback mechanism form negative to positive...[and] thus produced a self-reinforcing spiral of knowledge augmentation that was impossible in earlier days of engineering without mechanics, iron-making without metallurgy, farming without organic chemistry, and medical practice without microbiology.”

(Mokyr, pp.32-3)

“We are missing most of the action if we concentrate our efforts on formal science. Two stereotypic cartoons - the one of the ignorant, amateur ‘tinkerer’ who stumbled into great inventions through a combination of inspired intuition and sheer luck, the other of the methodical, well-informed scientist whose rigorous papers inform applied scientists and engineers of the exploitable, natural regularities - are ahistorical. In between, there was a semidirected, groping, bumbling process of trial and error by clever, dextrous professionals, with a vague but gradually clearer notion of the processes at work.... [Moreover,] instructions, not ideas, make things work. The early application of techniques were often based on the vaguest of ideas, [but] operating a technique led to a better and better notion of why something worked, and from there to how to make it work more efficiently or how to make it do something else. Watching a machine work, or a telegraph signal pass without knowing why it does so serves as an irritant to a mind trained in science. In this sense, technology works as a ‘focusing device’...[and] we could say, then, that the process of innovation was gradually becoming ‘less Darwinian’ in the sense that the mutations in useful knowledge were becoming less random, and more directed.”

(Mokyr, pp.82-4)

As regular readers of this site will be aware, I have considerable respect for work investigating the conditions/constraints governing what we might call the hands-on world of praxis. In fact, I think it could easily serve as a model for the reform of certain theoretically-inflated sectors of the academic Humanities. So, it is with pleasure that I read an economic theorist/historian such as Joel Mokyr, whose work is so clearly informed by the best technological understandings, while also making judicious use of complexity theory at its most informative via Cohen & Stewart. Moreover, his historical argument - albeit I can only excerpt it here - is extremely well (and widely) grounded...making it all the more impressive when he re-interprets comparatively neglected aspects of Enlightenment thinking/action - neglected, at least, in economic history - to secure the much-contested link between the Scientific and Industrial Revolutions:

“Two historical phenomena changed the parameters of how the societies of western Europe handled useful knowledge, in the period before the Industrial Revolution. One was the scientific revolution of the seventeenth century. The other is an event that might best be called the Industrial Enlightenment...that transformed the two sets of useful knowledge, and the relationship between them. It had a triple purpose. First, it sought to reduce access costs by surveying and cataloging artisanal practices in the dusty confines of workshops, to determine which techniques were superior, and to propagate them. Thus it would lead to wider adoption and diffusion of best-practice techniques. Second, it sought to understand why techniques worked, by trying to connect them to the formal propositional knowledge of the time, and thus providing the techniques with wider epistemic bases. The bewildering complexity and diversity of the world of techniques in use was to be reduced to a finite set of general principles governing them. These insights would lead to extensions, refinements, and improvements, as well as speed up and streamline the process of invention. Third, it sought to facilitate the interaction between those who controlled propositional knowledge, and those who carried out the techniques contained in prescriptive knowledge.... Historians have generally not been able to support the notion that the scientific revolution led directly to the Industrial Revolution. The missing link may well be the Industrial Enlightenment, forming the historical bridge between the two.... Part of the confusion is caused by the insistence on separating science from technology, or theory from empirical knowledge...[for, propositional] knowledge contains much more than formal science, however defined. It includes all natural facts and relationships, as well as a master catalog of all techniques known to work (since, strictly speaking, these are natural regularities). A new adaptation of a technique used elsewhere, or a recombination of existing techniques into a novel application, would thus have to depend both on the [propositional knowledge] base, and the ease of access to it.... [Moreover,] spillover effects, as much as the knowledge itself, created the Industrial Enlightenment, and set the stage for the changes in technology.”

(Mokyr, pp.34-6)

“The Industrial Enlightenment’s debt to the scientific revolution consisted of three closely interrelated phenomena: scientific method, scientific mentality, and scientific culture. The penetration of scientific method into technological activities meant accurate measurement, controlled experiment, and an insistence on reproducibility.... Scientific method also meant that observation and experience were placed in the public domain...a public good, communicated freely rather than confined to a secretive, exclusive few, as had been the custom in medieval Europe. [Moreover,] this sharing of knowledge within ‘open science’ required systematic reporting of methods and materials, using a common vocabulary and consensus standards. This, most decidedly, was not the case for [prescriptive] knowledge, where property rights were maintained as much as possible, through reliance either on patents, or secrecy, [and so] useful knowledge, it seems, went through something of a bifurcation.... Even more important, perhaps, was the scientific mentality, which imbued engineers and inventors with a faith in the orderliness, rationality, and predictability of natural phenomena...[and that] the phenomena produced by nature and the artificial works of mankind were subject to the same laws...[which] squarely contradicted orthodox Aristotelianism.... Finally, scientific culture, the culmination of Baconian ideology, placed applied science at the service of commercial and manufacturing interests.”

(Mokyr, pp.36-40)

“Josiah Wedgewood’s career can be thought of as the embodiment of the Industrial Enlightenment...[and] it might be objected that Wedgewood was not typical, but the argument of this book is that such unrepresentativeness is the heart of technological change: we could think of Wedgewood, Smeaton, and Watt as members of Hooke’s ‘Cortesian Army’.... Once they had solved the problems, and written the new chapters in the book of prescriptive knowledge, others followed through, even if they did not possess the epistemic base. For the history of knowledge, averages are therefore not very important: a few critical individuals drive the process. It is in this sense that the evolutionary nature of knowledge growth matters: selectionist models stress that what matters to history is that under the right circumstances very rare events get amplified, and ultimately determine the outcome.... A century ago, historians of technology felt that individual inventors were the main actors...[but] such heroic interpretations were discarded, in favor of views that emphasized deeper economic and social factors such as institutions, incentives, demand, and factor prices. It seems, however, that the crucial elements were neither brilliant individuals nor the impersonal forces governing the masses, but a small group of at most a few thousand people, who formed a creative community based on the exchange of knowledge.... [And,] paired with the appreciation that such knowledge could be the base of ever-expanding prosperity, these elite networks were indispensable, even if individual members were not.”

(Mokyr, pp.52-66)

Mokyr’s argument is - to my mind, at least - comprehensive, usefully analytical, and in real accord w/the best evidence. In short, I think it’s true, however unfashionable that particular word may be. Furthermore, it has the definite virtue of outreach...being willing to take on important questions - and, most importantly, the evidence that pertains to them - bordering upon his area of enquiry, such as the political dimensions of innovation... This aspect of his work reveals Mokyr as a scholar markedly unafraid of the shibboleths of his profession without, thankfully, being so in love w/originality that he is blind to the (genuinely) conservative.

“Negative feedback mechanisms, that prevented earlier economies from growing, weakened in the eighteenth century. Consider the constraints on resources, the basis of Malthusian negative feedback. E.A. Wrigley...has argued that the Industrial Revolution constituted a transition to an inorganic and mineral economy...[which] is much less vulnerable to population pressure. Yet the transition from organic to mineral economy still needs to be explained itself. [However,] the weakening of the ‘institutional negative feedback’ is more complex. In each society, entrepreneurs face the choice between making their money through the exploitation of political opportunities that increase their share of income without increasing (or even while reducing) the overall level, or through getting rich by the socially beneficial exploitation of technological or commercial opportunities. [And] in a variety of ways, the Enlightenment produced political change that made productive activity more attractive relative to ‘rent-seeking’ and opportunistic behavior...but, in and of itself, without changing the knowledge base of society, it would not have been able to account for sustained growth. It is worth keeping in mind that growth based primarily on institutional changes can be easily reversed by political catastrophes...[however, whilst] such disastrous reversals cannot be quite excluded in a growth process based on the expansion of useful knowledge...clearly it is less vulnerable to such shocks.”

(Mokyr, pp.80-1)

“Technological progress in a society is by and large a temporary and vulnerable process, with many powerful enemies with a vested interest in the status quo, or an aversion to change continuously threatening it.... Without an understanding of the political economy of technological change, then, the historical development of economic growth will remain a mystery. [But,] how should we think of resistance to new knowledge? Knowledge systems are self-organizing systems that in many ways can be thought of in evolutionary terms. The idea of self-organizing decentralized systems, or ‘catallaxy’ as Hayek has called it, is one of the most powerful and influential ideas of the modern age, and perhaps the most important element in Adam Smith’s thought.... Outside economics, self-organizing systems appear throughout our social system. Language, for example, is such a system, as are science, technology, the arts, manners, and so on. These systems are all informational systems and...in effect, conventions, and as such self-replicating, [for] conventions are not chosen, they evolve...[and, like biological species,] resist change once they settle down.... Such resistance is necessary if a technological system is not to degenerate into anarchy, just as languages have to resist change if communication between individuals is to remain reasonably efficient.... The idea that ‘if it ain’t broke, don’t fix it’ is one of those half-truths that reflect the ambiguity of the problem. There are cases when something is not broke, yet by fixing it we can make it better, while in others we are wasting our time and resources. Unfortunately, we do not know in advance which of the two situations we are in, until we try.”

(Mokyr, pp.221-4)

“In markets, it is difficult to express a no vote.”

(Mokyr, p.236)

Which, not coincidentally, is a very powerful argument for politics that the libertarian ideologues of neo-classicism have never managed to get their heads around. By setting out in such detail the very real processes by which innovation makes losers as well as winners, and refusing to indulge the friction-free market utopians, Mokyr clearly portrays the other side to the epistemic puzzle - the politics of reaction which so dominated until the advent of the modern world - with a fairness rare in economic analysis.

And, penultimately, he also takes serious pains to subject to economic/historical analysis key questions rarely treated w/much care in this area - the emergent home/work divide of modernity, in particular - showing that, if analysts take sufficient care to include all the relevant evidence, economic analysis of such subjects can be surprisingly informative. Moreover, they strongly suggest that our - unthinking - idealization of a world where such a division was absent neglects the very real price we paid for such...a burden largely borne by the very poorest of all:

“What does technology really do, to our lives and well-being? Much of the history of technological revolutions in the past two centuries is written as if the only things technology affected were output, productivity, and economic welfare as approximated by income...yet technological progress also affected other aspects of the economy that may be significant Among those is the optimal scale of the basic economic production unit.... The stylized fact is that the Industrial Revolution of 1760-1830 witnessed the ‘rise of the factory’...[and] there are three main explanations.... One relies on fixed costs and technical and physical economies of scale and scope, which might have caused the minimum efficient size of plants to become larger than the household. A second explanation is drawn from the modern micro-economics of the firm: because of asymmetric information and the division of labor, costs were higher in decentralized households, and the new technology changed the benefits and costs of monitoring and the incentives to self-monitor. A third argument is that by concentrating all workers under one roof, and placing them under supervision, actual labor effort is enhanced.... These explanations are not alternatives, but reinforce one another, creating synergistic effects.... [In addition,] in the early stages of the Industrial Revolution most machinery was custom-made, demanding in-house expertise and tacit knowledge for operation, repairs, preventative maintenance, and so on.... More knowledge than a single household could possess.... Factories thus [in addition to their other purposes] served as repositories for technical knowledge, and vastly reduced access costs to this knowledge.”

(Mokyr, pp.119-41)

“In a classical world, in which firms produce and households consume, firms compete with each other in a Schumpeterian sense...[and] those who choose inefficient techniques lose market share and profits, and eventually shrink and disappear.... [However,] this kind of Darwinian mechanism does not work very well for a world of family firms, in which the home is the plant and the household the unit of production, because households are constrained from growing too large, and there is no well-defined exit process...[so] mechanisms that eliminated efficiency differences between them worked poorly.... Inefficient or lazy household firms may not have ‘died’ unless their inefficiency reached truly disastrous dimensions.”

(Mokyr, pp.129-30)

As usual, unthinking idealization neglects the very real costs - not to mention victims - of that which we mistake for utopia. Rather, we should do our ancestors the basic courtesy of trying to understand their lives...and, not coincidentally, admit that all social orders have their necessary price. And, in helping us address this Mokyr - in his final chapter - returns to the question which turns out to have underpinned his whole enquiry - that of “the political economy of knowledge” - and, with it, tackles the comparative/macrohistorical question. And, yet again, he demonstrates that rare and scrupulous even-handedness which makes this book so valuable...

“In his classic book on the evolution of modern technology, D.S.L. Cardwell stated that most societies that have been technologically creative have been so for relatively short periods.... This observation holds for individual European societies, of course, but precisely because Europe was fragmented it does not hold for the continent as a whole. It is as if technological creativity was like a torch too hot to hold for long.... Led first by northern Italy and southern Germany, technological leadership passed briefly to [Portugal and Spain] in the Age of Discoveries, and to the Low Countries in the Age of Reformation. Much of Holland’s spectacular success in the Golden Age was a result of that nation’s technological innovativeness, which complemented its commercial achievements. From there, technological leadership passed to Britain during the first Industrial Revolution, then to the United States and Germany.... [This] reflects the well-known hypothesis that western Europe’s advantage over large empires such as China, the Ottoman Empire and Russia was its pluralism, its diversity, and its fragmentation, [which] goes back at least as far as David Hume, who pointed out in 1742 that ‘nothing is more favorable to the rise of politeness and learning than a number of neighbouring and independent states, connected together by commerce and policy. The emulation which naturally arises among those neighbouring states is an obvious source of improvement. But what I would chiefly insist on is the stop [i.e., constraint] which such limited territories give, both to power and authority’.... [Moreover,] to the idea of competition in a states system we can add the equally intuitive argument of geneticists that diversity in any gene pool is more likely to produce creativity. Thus a multitude of diverse cultural traditions is more likely to result in successful combinations...[whilst] original and creative minds who found, for one reason or another, the environment in their native land inhospitable to their ideas, could and often did flee to another.”

(Mokyr, pp.276-9)

“All the same, the argument should be qualified...[for] pluralism is neither a sufficient nor a necessary condition for technological creativity.... As in evolutionary biology, genetic diversity does not guarantee natural innovation, any more than in economics the existence of competition between firms can guarantee economic progress.... [Finally, there are] the enormous costs and hazards of political fragmentation. The burden that internecine wars imposed on Europe for centuries is easily underestimated, [and] political fragmentation and interstate competition did far more damage than was tolerably affordable in exchange for the putative technological benefits they may have conferred.... The misleading nature of the application of the economic model of competition to the ‘states system’ is well illustrated by the problem of the optimal size of the state. Much of the history of Europe (as well as the Middle East) demonstrates that for many purposes the city-state may be the optimal sized unit...yet the competition and conflicts between city-states and larger political units resulted in military victories of the larger units.... It is thus far from a priori obvious that political fragmentation is on the balance beneficial. All the same, some measure of decentralization is probably desirable.”

(Mokyr, pp.279-82)

Joel Mokyr’s The Gifts of Athena, unfortunately, is not addressed to the general reader. Unfortunate, because it is a major work of synthesis and extension, making clear the full ramifications of the political economy of knowledge in a way which deserves a very wide readership. The inverse, say, of Richard Lanham’s Economics of Attention, the missing link between Elizabeth Eisenstein and James Beniger, and the economic counterpart of Taylor and Toulmin’s investigations of modernity, Mokyr’s work also serves to bookend that of Georges Duby...in that it explores the flowering of those long-term trends emergent as Europe moved out of the dark ages following the collapse of Rome.

Moreover and, like Duby - albeit from a somewhat different tradition - Mokyr is not at all content to draw the economic sphere narrowly, skilfully drawing relevant ideas/evidence from across the disciplines, without falling into the trap of indiscriminate eclecticism. That the result is so obviously consilient w/the new humanities project as a whole should come as no surprise, by this stage, as consilience remains our very best guide in this kind of work. And, as well, it is always teaching us new things...even if much of the content of these should be familiar by now. For, it is the questions - nothing else - that essentially divide the disciplines, and different questions always have somewhat different answers...

“A substantial portion of invention consists of recombination, the application of sometimes remote and disjoint sections of [propositional knowledge] together to form something novel. It is one of the chief reasons why lower access costs are so important...[and,] if taken to an extreme, recombination can lead to dazzling rates of innovation, because the rate of invention will be combinatorial, which is faster than exponential.... It may be an exaggeration to say, with Francois Jacob, that ‘to create is to recombine’...because some elements are truly novel, but it is surely true that much of technological innovation consists of precisely such activities. Hence the importance of efficient and accessible sources of useful knowledge.”

(Mokyr, pp.75-6)