Courtesy of Joshua M Brown, The Reformed Broker
For the last 500 years, the West has been completely dominant over the East. Economic historian Niall Ferguson, writing in the Wall Street Journal, tells us that in 1968 the average American was 33 times richer than the average Chinese.
How had things gotten so lopsided? Ferguson points to "six killer apps" that the West had developed, leaving the East (and the rest of the world) in the dust:
• Competition: Europe was politically fragmented, and within each monarchy or republic there were multiple competing corporate entities.
• The Scientific Revolution: All the major 17th-century breakthroughs in mathematics, astronomy, physics, chemistry and biology happened in Western Europe.
• The rule of law and representative government: This optimal system of social and political order emerged in the English-speaking world, based on property rights and the representation of property owners in elected legislatures.
• Modern medicine: All the major 19th- and 20th-century advances in health care, including the control of tropical diseases, were made by Western Europeans and North Americans.
• The consumer society: The Industrial Revolution took place where there was both a supply of productivity-enhancing technologies and a demand for more, better and cheaper goods, beginning with cotton garments.
• The work ethic: Westerners were the first people in the world to combine more extensive and intensive labor with higher savings rates, permitting sustained capital accumulation.
If you’ve read anything else by Ferguson recently, then you know he’s a major Sinophile and that he sees the balance of power shifting faster than most suspect. Click over for more of his views on China’s emerging dominance.
Source: In China’s Orbit (WSJ)
Originally published at Joshua Brown’s Reformed Broker, Niall Ferguson’s “Six Killer Western Apps”
