15.
UNDERSTANDING PROSPERITY AND POVERTY
H ISTORICAL O RIGINS
T HERE ARE HUGE DIFFERENCES in living standards around
the world. Even the poorest citizens of the United States
have incomes and access to health care, education, public
services, and economic and social opportunities that are
far superior to those available to the vast mass of people
living in sub-Saharan Africa, South Asia, and Central
America. The contrast of South and North Korea, the two
Nogaleses, and the United States and Mexico reminds us
that these are relatively recent phenomena. Five hundred
years ago, Mexico, home to the Aztec state, was certainly
richer than the polities to the north, and the United States
did not pull ahead of Mexico until the nineteenth century.
The gap between the two Nogaleses is even more recent.
South and North Korea were economically, as well as
socially and culturally, indistinguishable before the country
was divided at the 38th parallel after the Second World
War. Similarly, most of the huge economic differences we
observe around us today emerged over the last two
hundred years.
Did this all need to be so? Was it historically—or
geographically or culturally or ethnically—predetermined
that Western Europe, the United States, and Japan would
become so much richer than sub-Saharan Africa, Latin
America, and China over the last two hundred years or so?
Was it inevitable that the Industrial Revolution would get
under way in the eighteenth century in Britain, and then
spread to Western Europe and Europe’s offshoots in North
America and Australasia? Is a counterfactual world where
the Glorious Revolution and the Industrial Revolution take
place in Peru, which then colonizes Western Europe and
enslaves whites, possible, or is it just a form of historical
science fiction?