One of the most positive trends in the social sciences in the last 30-40 years or so has been the renewed interest of economic historians in long-run analysis. Under various monikers such as ‘global history’, ‘world history’, and even ‘deep history’, the comparative study of economic and social change in the long run has offered some profound perspectives on the origins of our times. Generally, however, the guiding question has been the one at issue in the ‘rise of the West’ debate and the adjacent topics of Eurocentrism, imperialism, technological progress, and colonial ideology. That is to say, much of the discussion has been primarily concerned with the question “how did Europe come to dominate the world?”, and to some extent also the followup question, “when did, whatever it was that allowed this to happen, begin? “.
Bas van Bavel’s recent book, The Invisible Hand?, asks a very different kind of question. This book is not concerned with the rise of the West, but with the underlying economic framework that most mainstream economic historians use in understanding the long-run socioeconomic patterns that they study. Although the specifics differ by author, of course, most of the economic historical mainstream still presents the story of economic history, and with it the difference between poor and rich today, as that of the ‘unfolding’ of the free market. The main disagreements consist of what kind of institutional order was necessary to make that free market flourish in Western history, and to what extent such an order as the Western world has could be adopted by developing nations as a matter of policy. Although there are exceptions, for the most part the working assumption is still that more markets, freer markets, and strong property rights – read: strong enforcement of the power of property owners – were the core ingredients that the Western nations achieved and by which they prospered. Whereas others, failing to achieve such an institutional order, suffered and still suffer stagnation and poverty. It is in this light that these economic historians also read such historical sources on markets and merchants as we have: as analytical and political defenders of what Adam Smith called the ‘commercial society’. Continue reading “Book Review: Bas van Bavel, “The Invisible Hand?””