Showing papers by "Douglass C. North published in 1973"

The Rise of the Western World: A New Economic History

Abstract: A radically new interpretation, offering a unified explanation for the growth of Western Europe between 900 A. D. and 1700, provides a general theoretical framework for institutional change geared to the general reader. North and Thomas seek to explain the "rise of the Western world" by illuminating the causal importance of an efficient economic organization that guarantees a wide latitude of property rights and both incentives and protection for economic growth. Although they pay homage to both Marxian and neoliberal theory, they take a theoretical middle ground that privileges the sociopolitical backdrop of economic affairs (as opposed to solely private or class-based activity) and in doing so identifies the roots of modernization as far back as the 10th Century. To justify the novelty and originality of this approach, they write that most analysts have misidentified the symptoms of modern economic growth (technological change, human capital, economies of scale) as the causes. In doing so, previous scholars have failed to answer the question "if all that is required for economic growth is investment and innovation, why have some societies missed this desirable outcome?" (2). Their answer is that some societies (England and the Netherlands) were better than others (France and Spain) at providing an efficient economic organization that could guarantee conditions favorable to per capita economic growth among a rapidly growing population.

Property Rights in Land and Man

Abstract: Before we explore these six centuries in more detail, it is well to specify much more precisely the explanatory theory implicit in the previous chapters. The pressure to change property rights emerges only as a resource becomes increasingly scarce relative to society's wants. In the world of the tenth century, at the point where we entered into it, land was abundant and therefore not worth the cost of devising exclusive rights to its use. When one piece of land was taken up, more was always available. Because the countryside lay under constant threat of ravage by marauding bands of Vikings, Moslems, Magyars or even of native brigands, greater value attached to any areas protected by a fortification and skilled soldiers. Such land, from the very beginning of the manorial system, was never a completely ‘common-property’ resource in the sense that economists use that phrase. Customs and precedents limited its usage to preclude overgrazing and other hazards implicit in common use. We shall see later that manorial regulations grew more restrictive as land became scarce. Two other basic elements entered into the manorial economy; the functions of protection, and the role of labor. In the matter of protection, the fortified castle and armored knights on horseback, having specialized skills in warfare, provided local security which could never be equalled by any group of peasants ill-armed with primitive weapons and lacking military skills.