In Box

Reinventing the Wheel

Why no-tech ancient civilizations still can't catch up.

When I worked at the World Bank, management was always checking up on us to make sure our research was relevant for real-world economic development. The standard test question was, "What would your research suggest the finance minister of country X should do?" This question reflected the standard view that has endured since the beginning of development economics six decades ago -- that all countries begin with a blank slate and that development happens when today's government leaders execute wise policies. My job was simply to tell the leaders what those wise policies were.

Imagine the dismay of my managers if my advice to the finance minister had been, "Make sure your country was well caught up on technology -- 500 years ago." But seemingly irrelevant as that advice might be, it's actually true. If a country had the printing press and the magnetic compass in 1500, it's a pretty safe bet it has a strong national economy today. Ancient history still matters for today's development, providing unique insight into why the lights are still off in the dark corners of the world and what we might do to change that.

Strangely, history has never figured into the equation when it comes to exploring why some countries prosper and others don't. To understand how it might relate, Diego Comin at Harvard Business School, Erick Gong at the University of California, Berkeley, and I started by compiling a list of 11 ancient technologies that were around in 1000 B.C.: Was there written language? The wheel? Agriculture and iron tools? We drew today's boundaries on the ancient world and assigned each separate technology history to the future country that would form within that territory. Then we expanded the survey to 1500 A.D., looking for the adoption of 24 technologies, including oceangoing ships, paper, printing, firearms, artillery, the magnetic compass, and steel.

We found that there was a remarkably strong association between countries with the most advanced technology in 1500 and countries with the highest per capita income today. Europe already had steel, printed books, and oceangoing ships then, while large parts of Africa did not yet have writing or the wheel. Britain had all 24 of our sample technologies in 1500. The Democratic Republic of the Congo, Papua New Guinea, and Tonga had none of them. But technology also travels. North America, Australia, and New Zealand had among the world's most backward technology in 1500; today, they are among the wealthiest regions on Earth, reflecting the principle that it's the people who matter, not the places. As migration has transformed parts of the world that were nearly empty in the Middle Ages, technology has migrated with them.

And these differences had already appeared in 1000 B.C.: Late Bronze Age culture in what is now Western Europe already had pack animals, ceramics, and metalwork, while the Central African Neolithic culture did not. In short, the winners keep winning. As Billie Holiday sang, "Them that's got shall get/Them that's not shall lose."

Why is technology so decisive? It's the building block, as our study confirmed, of future innovation -- and that in turn, of course, is the engine of national economic growth. The Romans could not have built aqueducts without prior knowledge of cement masonry. James Watt drew on advances in metallurgy, chemistry, mechanics, and civil engineering -- all of which he had learned in the mining industry -- to make the steam engine. Put the steam engine on rails, and you've got trains. And so on.

OF COURSE, IN SOCIAL SCIENCE, no generalization is universal. The most important counterexample is China, which in 1500 had plow cultivation, printing, paper, books, firearms, the compass, iron, and steel, and yet failed to emulate Europe's Industrial Revolution in the centuries that followed. Scholars have argued that autocratic Chinese emperors killed off technological progress for domestic political reasons. For example, one Ming emperor banned long-distance oceanic exploration for fear of foreign influence threatening his power, after Chinese ships had already reached East Africa in 1422.

This gives us a hint as to how political formation affects development: Fragmented Europe did not have any one autocrat who could kill off technological innovation, and the constant threats of living in a hostile neighborhood spurred the advancement of military technology. And because borders were relatively open around 1500, the reality that citizens could leave for more advanced places -- the forerunner of today's "brain drain" -- kept alive the spirit of innovation.

But does this research imply a fatal determinism, a preordained outcome to the world's race for economic dominance, destined to be lost by countries trying to catch up with the West? Is there inherent racism in the notion that some peoples carry technological innovation with them? No and no. As China's history has shown, when governments stop killing innovation, good things happen. Technological change has also dramatically speeded up, and lower communication and transportation costs make it cheaper and easier to borrow advanced technologies from other countries -- allowing societies to leap forward.

Finland, for instance, was a pastoral society with little cultivation technology and no oceangoing ships in 1500; now it's home to Nokia and some of the world's leading cruise-ship builders. The explosive growth in cell phones in Africa, skipping the intermediate step of land lines, is a promising sign of what Africa's tech future could look like -- if it weren't for its plague of poor governments. In today's globalized and hyperconnected world, the possibilities for jumping around mean that the technology of 1500 can only explain part of the variation of per capita incomes -- the other part of technological progress is still up for grabs.

So what does this tell us about the prognosis for bringing the world's bottom billion up from poverty? For one, it tells us that we've been doing development wrong. The traditional approach to development was as a top-down process led by great men and benevolent autocrats, advised by great experts. Former World Bank chief economist Stanley Fischer used to joke about a new grammatical tense he called the "World Bank imperative form": Country reports were long lists of things that "must be done" by the authorities, ranging from grandiose infrastructure projects to implementing detailed plans to meet health, nutrition, sanitation, and education needs. But our research shows that development is not about what you dictate, but what you discover. Little penicillin did far more to improve the world's lot than big plans conceived around a conference table.

The World Bank imperative approach gave us Africa's stagnation, the failure of economic reforms in the 1980s and 1990s, and the disastrous transition from communism to capitalism in the former Soviet Union. These and many other disappointments over the past half-century do not predict a cheery future for the great-men-cum-great-experts approach.

Most importantly, what the history of technology tells us is that the blank-slate theory is a myth. Top-down development programs simply don't work. In fact, the principal beneficiaries of Western largesse today -- African autocrats and dysfunctional regimes -- are themselves the main obstacles to development. If there's anything that "must be done" to spur future development, it's to create the conditions necessary to empower the ordinary individuals who will create new and unforeseen technologies out of old ones. There's a Thomas Edison born every minute. We just have to help them turn the lights on

CHRISTOF STACHE/AFP/Getty Images

In Box

The YIMBYS

Five places saying "yes, in my backyard" to the nasty stuff that no one else wants.

RUSSIA
The Dump: Nuclear waste
Prime Minister Vladimir Putin has ambitious plans for Russia's nuclear energy sector, and they go beyond his bid to become a global supplier for countries that can't enrich their own uranium. In 2001, then-President Putin signed a package of laws allowing Russia to import spent nuclear fuel, opening the door to a trade estimated at $20 billion over the last decade in reprocessing and storing irradiated waste. The country has imported spent fuel from research reactors in Bulgaria, the Czech Republic, Latvia, Libya, Romania, Serbia, and Uzbekistan, as well as tens of thousands of tons of depleted uranium from power plants in France, Germany, and the Netherlands. Russia is legally required to ensure that the re-enriched fuel and reprocessed waste is returned or properly disposed of, but only a small percentage of the original material gets sent back. What happens to the rest? An estimated 700,000 tons of radioactive uranium tailings (including waste from Russia's domestic reactors) are being kept in Siberian cold storage, some outdoors in rusting steel canisters at Mayak, Russia's only reprocessing facility and site of a horrific nuclear accident in the 1950s. For environmentalists, Mayak is one of the world's longest-running ecological disasters. For Putin, it's also big business.

JOHANNES EISELE/AFP/Getty Images

MEXICO
The Dump: Offshore drilling
U.S. President Barack Obama may be rethinking offshore oil drilling in the wake of the BP blowout, but Mexican President Felipe Calderón's main concern is that his country isn't drilling enough. With Mexico's proven oil reserves declining -- daily production has decreased by roughly 1 million* barrels since 2004 -- Pemex, the state oil monopoly, is anxiously drilling new exploratory and development wells, mostly off the country's northeastern coast. That should make the Gulf of Mexico's pelicans and sea turtles nervous, given the company's environmental safety record -- more than 1,000 Pemex workers have died in industrial accidents over the last two decades, and Pemex holds the previous record for history's largest peacetime oil spill, the 1979 Ixtoc disaster.

JUAN BARRETO/AFP/Getty Images

GHANA
The Dump: Trash
For years, the Ghanaian government has sought to make treasure out of its enormous supply of trash, even touting the slogan, "Solid Waste: Big Problem! Big Opportunity!" The opportunity is waste-to-energy, a process for capturing gases from waste and converting them to fuel. Ghana hopes that garbage alone can generate 50 megawatts of electricity over the next 15 years. But though the country has some of the worst sanitation in sub-Saharan Africa, its landfills are so picked over that there's not enough "good" waste to turn into electric power. So, in 2008, the government proposed a $250 million scheme to import and incinerate garbage from Western Europe and Canada. Although the plan is still in development, Ghana is already a dumping ground for Europe's electronic waste, with containers full of broken cell phones, computer hard drives, and TVs arriving each month in the port of Tema, near Accra. European laws prohibit the export of this dangerous waste, but labeling the trash as a "charitable donation" offers a loophole. In the enormous Agbogbloshie dump, children smash keyboards and burn circuit boards to salvage scraps of iron and copper for sale, sending up black plumes of smoke over the acrid city.

ARIS MESSINIS/AFP/Getty Images

THE NETHERLANDS
The Dump: Prisoners
Peaceful, prosperous, and friendly to pot and prostitutes, the Netherlands has so few criminals that it has been forced to close eight prisons and cut more than 1,000 jobs in the national corrections system. Neighboring Belgium faces the opposite problem: serious prison overcrowding, with around 10,400 prisoners, more than 2,000 over capacity. In a shining moment of European integration, the countries have found a fitting solution: The Belgian government is planning to rent 500 Dutch jail cells for $38 million a year and send prisoners to the largely uninhabited Tilburg jail in the southern Netherlands. The prisoners will still fall under the jurisdiction of Belgian courts but may find a bit more elbow room in their new accommodations.

CEM TURKEL/AFP/Getty Images

AUSTRALIA
The Dump: Opium
Although morphine produced from opium is legally prescribed around the world as a pain reliever, most countries are hesitant to grow opium-producing poppies for fear that it will lead to an increase in organized crime, drug addiction, or even terrorism. That reluctance has provided an opportunity for the rugged island of Tasmania, which began producing opium in 1970 and currently accounts for about half the world's legal crop. The only state in Australia where opium cultivation is legal, Tasmania rakes in more than $60 million per year from the trade. The island's remote location off the southeastern coast of Australia has worked to its advantage, making it harder for smugglers to divert the crop to the heroin business. Aside from some stoned tourists and the occasional hallucinating wallaby -- yes, really -- Tasmania has seen few ill effects from its flourishing cash crop.

John Moore/Getty Images

*Correction: Daily production dropped by roughly 1 million barrels, not 1 billion, as originally stated.