227) Douglas North about open societies
A review of an important book:
Douglass North, John Joseph Wallis, Barry R. Weingast:
Violence and Social Orders - A Conceptual Framework for Interpreting Recorded Human History
(Cambridge University Press, 2009)
elites, domination and change
Ricardo Abramovay
Economic Value , 28/08 / 2009
The great advantage of open access societies is adaptive efficiency, which combines power and participation.
is the way they face the problem of violence that societies shape the interaction human and define the forms of their political and economic organization. Over the past ten thousand years, mankind has known mainly two ways to stop the violence. The longest lasting of the order is limited or natural state, typical of much of Mesopotamia to Britain under the Tudors or the Aztec empire. Indeed, it is in societies with limited access to live, even today, 85% of humanity in 175 countries. The central feature of these natural states is that stability comes from a coalition of forces whose members have privileges (in some cases, even rights) special. Military power is dispersed among several groups who renounce their use by establishing agreements to gain in economic activities. But those deals are closed and strictly personal. It is only in the last 150 years that a few companies formed states of open access, in which the processes of social domination are depersonalized and competition in terms of politics and economics paves the way for innovations that result in dramatic improvements in living standards. Ensuing two central questions: which allowed the order formed by natural states emerge societies marked by open access and why this transition was limited to a restricted number of such countries?
At 88 years old and holder of the Nobel Prize Economics 1993, - a reference book that will certainly be in the social sciences of the XXI century.
His starting point is that violence can only be controlled by the elites' interest in forms of economic exploitation that bring them more income than that provided by the use of weapons. It is only in societies open access there is a real monopoly on violence by the state. In the restricted access, violence is scattered and the challenge is to find ways to allow dominant groups to explore opportunities to gain that lead them to forgo their use. The primary means to do so is the restriction of the possibility of forming organizations to a small number of individuals. Hence the deep dependence and promiscuity among private and public organizations, characteristic of societies in closed access.
Until the early nineteenth century, create businesses or form a political organization, for example, was a privilege, the grant came from the state. It was since then, and initially only in three countries (Britain, France and United States), that the elites have undergone universal laws. At the same time, generalization is the ability to create independent organizations and the state is consolidated political control over military power. The monopoly of violence is a consequence and not a precondition for the formation of modern democracies.
The central question the book is: if the elites stabilize their power based on special privileges in customized forms of domination and restrictions on building organizations, how can the states of closed access to the premises to produce a social order supported in an impersonal and opening opportunities for increasingly large segments? The answer is that in societies of closed access, to ensure the prerogatives of the elite organizations whose expansion is needed just requiring the definition not only privileges but also rights of those elites. At the same time, it creates conditions that may broaden the opportunities for gain for larger segments of their own ruling elites, based on competitive processes, which requires a new institutional arrangement, in which depersonalized forms of domination are to be paramount. Democracy and development are neither renunciation of the dominant groups to their interests or they make concessions to the pressures of the masses. Are new forms of domination, where elites are employing organizations and methods of control and impersonal in which exponentially expands the possibility of forming organizations not only to elites, but the whole population.
The book aspires to nothing less than propose a new research agenda for the social sciences, the center of which are the ways in different societies deal with violence. Three important conclusions stand out. Firstly, the development is not just about adding "more capital or a transplant to correct society institutions such as democracy, property rights, markets or laws." Without giving rise to conditions that will, within the groups ruling, interest in opening opportunities for organizations to encourage the prescription of formal democracy (elections, markets, laws, etc..) can backfire. Development involves understanding the culture and history of countries and not formulas. The second conclusion is that open access societies are characterized by strong states, with a prominent intervention in economic life and, above all, the ability to offer bases in impersonal, public goods that contribute to reduce inequality and widen access to opportunities to generate income. Finally, and most importantly, natural states have proved extremely resilient, with its thousands of years, and we can not guarantee that societies open access will continue. But its great advantage is that they have greater adaptive efficiency than any other form of social organization known previously. This is not an uncritical defense of the market economy but a powerful historical analysis of the reasons why the elites extend the legal and organizational bases of their rule to, around, open extraordinarily rich possibilities of participation and social change .
Abramovay Ricardo, is a professor in the Department of Economics, FEA / USP, the coordinator of its Center for Environmental Economics (Nesa), a researcher from CNPq and FAPESP. www.econ.fea.usp.br / Abramovay
Friday, August 28, 2009
Wednesday, August 26, 2009
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226) International Economic Integration
Dennis MP McCarthy
International Economic Integration in Historical Perspective
New York: Routledge, 2006. xii + 254 pp. $160 (hardcover),
ISBN: 978-0-415-77027-9.
Reviewed for EH.NET by John R. Hanson II, Department of Economics, Texas A&M University.
This is a vague title because there are many historical perspectives one could take on globalization today. The proliferation in recent times of econometric work based on the principle of the economic integration of world commodity markets in the past is one such. This is a leading approach today, as a perusal of recent issues of the leading economic history journals indicates. Another approach, allied to the first, is statistically descriptive. What actually were the magnitudes of international flows of capital, goods, and labor in the past? This is also a common approach today, although less so than the other. Both are in the tradition of what used to be called the New Economic History.
The volume under review, however, is pure Old Economic History. It is largely non-statistical, non-theoretical and proffers conclusions based on the expertise of the author gleaned from qualitative sources. Though empirically based, it does not truck with modern studies, especially not the abundance of econometric ones published by Jeffrey Williamson and his associates in obvious outlets. It has, on the contrary, the air of wisdom gained from a lifetime of study of certain historical events and episodes in international economic integration. The question is whether such a treatment of various unconnected topics falling under the general rubric of international integration adds much to our understanding of today or of the past. Another question is whether this work belongs to the “lessons from history” genre of historical writing or the “historical roots of the present world” genre. The author seems to want membership in both. Either way, I learned something, but not much which sheds light on the present, either as guide to policy or roots of the current situation.
After an introduction which tries to define or give coherence to the body of the work, the author presents a series of chapters about internationalization in the past. These include chapters on colonial empires, merchant associations, religious empires, criminal empires, free trade areas, customs unions, and common markets, all in 194 pages of text. Obviously the discussions of each are cursory, but on those subjects with which I am familiar I found the author’s discussion and opinions well-grounded and to the point. So as an informative introduction for undergraduates to some interesting and sometimes neglected international history I was not disappointed. But what does it all mean?
For example, the author portrays most of this as the back story to the modern world, which is generally true. Modern globalization does not arise from a vacuum. The institutions described represent or are implied to represent the connection-building which let modern globalization flourish. Leaving aside the glaring omission of multinational enterprise, which the author apologizes for, it is not made clear what precisely the contribution of any of these things was to the present. Criminal empires? What does modern globalization have to do with the Mafia? What we get is a discussion of how the Mafia operates, period. There is no discussion of it as a model for the international drug trade, which is only briefly referenced, or anything else. This lack of close linkage of historical topics to present conditions is disguised by the author’s frequent use of the word “panorama” to describe what I would call his arbitrary (but not uninteresting) collection of episodes about international economic contact in the past.
As for lessons learned from study of these episodes, there is little of interest. The summary at the end continues the effort begun in the introduction to unify the disparate topics, but it can hardly be considered a guide to modern policy. Again, the “lessons learned” seem unique to the event which produced the “lessons.” The author needs to show in more detail what the moral of his tales is -- the takeaway (as my students like to say). My takeaway is the impression of a failed effort to bring modern pertinence to some very interesting historical material.
John R. Hanson II is Professor of Economics at Texas A&M University and Stipendiary Fellow of the Glasscock Center for the Humanities at Texas A&M. Among his publications are "Proxies in the New Political Economy: Caveat Emptor" _Economic Inquiry_, October, 2003. He is at work on denominational issues in the colonial American money supply.
Copyright (c) 2009 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator (administrator@eh.net). Published by EH.Net (June 2009). All EH.Net reviews are archived at http://www.eh.net/BookReview.
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Published by EH.NET (June 2009)
Dennis MP McCarthy
International Economic Integration in Historical Perspective
New York: Routledge, 2006. xii + 254 pp. $160 (hardcover),
ISBN: 978-0-415-77027-9.
Reviewed for EH.NET by John R. Hanson II, Department of Economics, Texas A&M University.
This is a vague title because there are many historical perspectives one could take on globalization today. The proliferation in recent times of econometric work based on the principle of the economic integration of world commodity markets in the past is one such. This is a leading approach today, as a perusal of recent issues of the leading economic history journals indicates. Another approach, allied to the first, is statistically descriptive. What actually were the magnitudes of international flows of capital, goods, and labor in the past? This is also a common approach today, although less so than the other. Both are in the tradition of what used to be called the New Economic History.
The volume under review, however, is pure Old Economic History. It is largely non-statistical, non-theoretical and proffers conclusions based on the expertise of the author gleaned from qualitative sources. Though empirically based, it does not truck with modern studies, especially not the abundance of econometric ones published by Jeffrey Williamson and his associates in obvious outlets. It has, on the contrary, the air of wisdom gained from a lifetime of study of certain historical events and episodes in international economic integration. The question is whether such a treatment of various unconnected topics falling under the general rubric of international integration adds much to our understanding of today or of the past. Another question is whether this work belongs to the “lessons from history” genre of historical writing or the “historical roots of the present world” genre. The author seems to want membership in both. Either way, I learned something, but not much which sheds light on the present, either as guide to policy or roots of the current situation.
After an introduction which tries to define or give coherence to the body of the work, the author presents a series of chapters about internationalization in the past. These include chapters on colonial empires, merchant associations, religious empires, criminal empires, free trade areas, customs unions, and common markets, all in 194 pages of text. Obviously the discussions of each are cursory, but on those subjects with which I am familiar I found the author’s discussion and opinions well-grounded and to the point. So as an informative introduction for undergraduates to some interesting and sometimes neglected international history I was not disappointed. But what does it all mean?
For example, the author portrays most of this as the back story to the modern world, which is generally true. Modern globalization does not arise from a vacuum. The institutions described represent or are implied to represent the connection-building which let modern globalization flourish. Leaving aside the glaring omission of multinational enterprise, which the author apologizes for, it is not made clear what precisely the contribution of any of these things was to the present. Criminal empires? What does modern globalization have to do with the Mafia? What we get is a discussion of how the Mafia operates, period. There is no discussion of it as a model for the international drug trade, which is only briefly referenced, or anything else. This lack of close linkage of historical topics to present conditions is disguised by the author’s frequent use of the word “panorama” to describe what I would call his arbitrary (but not uninteresting) collection of episodes about international economic contact in the past.
As for lessons learned from study of these episodes, there is little of interest. The summary at the end continues the effort begun in the introduction to unify the disparate topics, but it can hardly be considered a guide to modern policy. Again, the “lessons learned” seem unique to the event which produced the “lessons.” The author needs to show in more detail what the moral of his tales is -- the takeaway (as my students like to say). My takeaway is the impression of a failed effort to bring modern pertinence to some very interesting historical material.
John R. Hanson II is Professor of Economics at Texas A&M University and Stipendiary Fellow of the Glasscock Center for the Humanities at Texas A&M. Among his publications are "Proxies in the New Political Economy: Caveat Emptor" _Economic Inquiry_, October, 2003. He is at work on denominational issues in the colonial American money supply.
Copyright (c) 2009 by EH.Net. All rights reserved. This work may be copied for non-profit educational uses if proper credit is given to the author and the list. For other permission, please contact the EH.Net Administrator (administrator@eh.net). Published by EH.Net (June 2009). All EH.Net reviews are archived at http://www.eh.net/BookReview.
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