More on Chile’s Head Start

Just a couple of things in reply to Robinson’s response.

First, the nineteenth century was very long. A hundred years. Robinson and I are talking about complete different historical periods. The free trade I mentioned, in which Chile was engaged, happened very early on, with public support for it being made explicit even before 1800. Chilean intellectuals such as Manuel de Salas, Armando de la Cruz, and even the Libertador Bernardo O’Higgins himself were arguing in favor of free trade, on economic and political grounds, in some cases twenty years or more before David Ricardo’s writings and the Corn Laws controversy in England. Thus, Chile had an advantage of at least 50 years, possibly more, in relation to the free trade other countries in the region engaged in as the British Empire expanded. By the time other Latin American countries were starting to export primary commodities to England and elsewhere, Chile had–at least partly thanks to the progress brought by several decades of free trade–already developed institutions, including a national army and a strong sense of national identity across different social classes, which allowed it to free Peru from Spanish rule, and then to go on to win all the local wars it was involved in. In other words, by the time other Latin American countries were starting to benefit from free trade under Pax Britannica, Chile had already done it for several generations, having started even before England herself had embraced free trade.

As to being “civilized” and “free,” again Robinson and I are talking about different things. In the nineteenth century, Chile was “civilized” and “free” as compared with the rest of Latin America (it does not make much sense to compare Chile in the 19th century with Scandinavian countries in the 21st century). The fact is that, again from very early on in the nineteenth century, Chile was chosen as their favourite country to go into exile by the most distinguished Latin American democratic intellectuals, including, for example, Argentinian Domingo Faustino Sarmiento and Venezuelan Andres Bello. Before going to study in the United States and Europe became fashionable, the children of the Latin American elites typically chose to become students of Chilean universities. Of course, these exiles and students were not illiterate campesinos. No one is claiming that. The benefits of progress only very gradually were extended from the top to the bottom of the social pyramid. Chile, in that sense, was no different from the rest of Latin America, and from many other countries.

Also from this issue

Lead Essay

  • Culture and Economic Development by Lawrence E. Harrison

    In this month’s information-packed lead essay, Lawrence E. Harrison notes that the role of culture has been badly neglected in serious studies of economic devewlopment. But then, he asks, what explains “why, in multicultural countries where the economic opportunities and incentives are available to all, some ethnic or religious minorities do much better than majority populations?” Harrison reports some results of his recent Culture Matters Research Project, including the finding that “Protestant, Jewish, and Confucian societies do better than Catholic, Islamic, and Orthodox Christian societies…” Harrison provides a number of incisive country case studies, illustrating different ways pre-existing culture can produce economic results, and the ways policy and politics can transform culture.

Response Essays

  • The Universal Culture of Progress by Gregory Clark

    In his reply to Harrison’s lead essay, University of California, Davis economist Gregory Clark writes, “I simultaneously want to endorse [Harrison’s] promotion of culture, and to run screaming from his lethal embrace.” While agreeing that the failure of purely institutional explanations of historical economic growth “opens the door … for culture,” Clark argues that “attempts to introduce culture into economic discussions so far have been generally either ad hoc, vacuous, blatantly false, or void of testability.” Clark points to great variation in economic performance within cultures and religions, and worries that Harrison’s “measures are not a pure probe into the essence of local cultures, but reflect institutions and economic environments that change the real possibilities for people.”

  • The How, The What, and The Why of the “Culture Matters” Thesis by Peter J. Boettke

    In his reply to Lawrence Harrison’s lead essay, George Mason University economist Peter J. Boettke argues that it is not culture but institutions—“the rules of the game that govern the way that people interact with one another”—that are the primary determinant of economic growth. However, culture may be crucial, Boettke argues, since it is “a tool for the self-regulation of behavior” that may raise or lower the cost of monitoring and enforcing compliance with “the rules of the game.” And that can make the difference between the success or failure of growth-conducive institutions and policies such as “private property, freedom on contract, limited scope of regulation, monetary restraint, fiscal responsibility, and open trade.”

  • It’s Not Culture by James A. Robinson

    James A. Robinson of the Harvard University Department of Government argues that Harrison’s measures are insufficient to establish that culture is the x-factor in economic development. For example, Robinson argues that the relative success of certain ethnic and religious minorities may be due to concessions from the majority group, and not the features of the minority culture. Also, Robinson asks, if the economic success of Chinese minorities in other countries is “because they have such a good culture, then why is China one of the world’s poorest countries?” And if Chile’s success lies in its distinctive culture, “then why did it manifest itself so recently?” Robinson concludes that “culture might matter, but doubters like me will not be convinced by the evidence here.”

The Conversation