Joel Mokyr: prediction

Transcript context

…Now, why are these cultural trends so persistent? I recall, in the 1990s, reading Francis Fukuyama’s book Trust. He argued that large Chinese corporations were going to be very difficult to establish because China did not have enough trust, unlike Japan. Now, a few decades later, that seems obviously wrong. There are many quite large Chinese corporations, and the large Japanese corporations, they’ve maintained a foothold, but they actually haven’t done that well. Things changed quickly. Why so much persistence here? That’s a very good question. There’s some debate about how much persistence there really is. Particularly, the communist regime under Mao did all they could to erase the influence of clans and replace it, of course, with communist functionaries. There’s some evidence, and some research has recently shown, that that wasn’t 100 percent successful. I think what you get, particularly in societies such as China, but in other places as well where corporations were largely absent and where your society was organized by family, is that it actually changes people’s culture and people’s values. If you look at all the work that’s been done by economists like Stephen Enke and anthropologists like Joe Henrich, they all show a very tight correlation between attitudes and cultural values and kinship, whether that’s extended kinship or nuclear family. I think what you could do in China and in Europe is you could maybe change your organizations, but you cannot change the state of mind. An interesting fact is that many of the corporations that we talk about that were established during the Middle Ages eventually disappeared or became very unimportant. For instance, guilds eventually got abolished after the French Revolution on the continent, and they were weakened in England much earlier. Monasteries still exist in Catholic countries, in Protestant countries, and in England. They were completely abolished. But the frame of mind and the cultural values that growing up in a nuclear family imbues, that kind of thing sticks around. Corporations, of course, remained, but they changed their form very much. The one most persistent of all those corporations, interestingly enough, were universities. Effectively, the form of universities, with the fact that they are self-governing and they’re sort of self-contained organizational units that write their own rules and their own bylaws, that thing, despite a lot of pressure on them, is still surviving, which I find very striking. We should think about a world that consists of lots and lots of different organizations like that, in which cities, for instance, were self-governing and made their own rules. Again, you see cooperation between people who share a location but not necessarily an ancestor. These things tend to be very persistent precisely because of institutions interacting with culture and culture feeding back into institutions. They evolve or co-evolve, I should say, together. That makes them, I think, much more persistent, Tyler. Why is it so late in history that Chinese cities still have more people than, say, London or Paris, if the Chinese model is economically inferior?…

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