Friday, July 10, 2026

Joel Mokyr on China, India, and Europe; clans vs. corporations; the idea of progress.

A Conversation with Tyler: Joel Mokyr on Clans, Corporations, and a Culture of Growth (Ep. 282)

Joel Mokyr co-won the 2025 economics Nobel for exploring the question that traces back to the beginning of economics: how did sustained economic growth suddenly become normal? For nearly all of human history, cleverness didn’t compound. What changed, according to Mokyr, was twofold: first, you need to know why something works, so that one advance can seed the next; second, you need a culture willing to tolerate the disruption. His new book contrasts Europe with China, showing how Europeans learned to cooperate with people they weren’t related to, in guilds, monasteries, cities, and universities, while China organized itself around the extended clan. One path led to internal stability and peace; the other, more restless and outward-looking, was the one that decided the world could always be made better.

Tyler and Joel discuss European corporations vs. Chinese clans, why the Catholic Church became obsessed with cousin-marriage, how persistent cultural trends really are, why Chinese cities became so populous relative to Europe, why it took so long for European living standards to surpass China’s, why sinified invaders kept getting swallowed by the dynasties they conquered, how geography kept Europe fragmented and China unified, where India fits into the story, why the Romans never made spectacles, why British soldiers stood two inches taller than the French, what powered the sudden rise of 19th-century German science, how disruptive winning a Nobel is, and much more.

Clans vs. Corporations

COWEN: Start by telling us, in the book, your thesis about European corporations versus Chinese clans and the importance of that difference. How would you explain it?

MOKYR: Well, the difference is, basically, the kind of organizations that produce what we call local public goods, so things like food relief and education, religious services, things like that, I would think that if you look at the world, say, around 800, at the time of Charlemagne, the difference between Europe and China isn’t very large. At some point, during the Middle Ages, you can see this divergence getting started. What’s happening is that, in Europe, there is more and more of a decline in the extended family or the extended kinship group, we call it clan, and instead, people get together and cooperate with other people to whom they are not related and with whom they do not share an ancestor.

Whereas in China, it moves exactly in the other direction. In China, you get more and more people getting organized by their extended family. The reasons for that are fairly complex. In Europe, it’s particularly the Catholic Church that played a major role here. This was argued quite a while ago by a guy, an anthropologist called Jack Goody, but your own colleague Jonathan Schulz wrote, what I think is one of the best papers on the subject, who pointed this out in great length and actually provided a fair amount of systematic evidence for this.

In China, there is no Catholic Church. The imperial bureaucracy is more and more in cahoots with local clans to whom they actually outsource a fair amount of the things that they were supposed to do. As you move on out of this period of the Song dynasty into later dynasties, you see this thing growing. The problem in Europe is that the nuclear family, which became the fundamental building block of society, is too small to provide local public goods. You need to cooperate with others. What emerges in Europe, and quite spontaneously, is a bunch of things that provide these local public goods that you just don’t see in China.

For instance, we have something called universities. We have monasteries. We have autonomous cities. All of those things are what we call corporations. What it is, is people who are not related, but what they share is not an ancestor but an objective. Guilds have one kind of objective, universities have another one, and so on and so forth. That divergence in social organization turns out, in our view, to be one of the key components of the divergence between Europe and China.

COWEN: Do you take that change in policy from the Catholic Church as exogenous or that it is rooted in earlier features of Western society such as the ideology of Christianity itself or maybe earlier Roman times? What is causing what? What’s the most fundamental driver here in the West?

MOKYR: Well, there’s some debate about that. They don’t, of course, tell you. There are, I think, two components about this, and I would not know how to weight them. There are two things happening here. The first is that the Catholic Church really becomes quite obsessive about certain sins that they consider to be particularly egregious. One of those sins is incest. Every society in the world prohibits marriage between siblings, but other more remote relatives is more ambiguous. The Church becomes quite obsessive about this. At the end, there are places where they actually prohibit the marriage of fifth-degree cousins. Now, how anybody in the Middle Ages would know who is fifth-degree cousin is, is unclear. I don’t know who my fifth-degree cousins are. Maybe you do.

The other thing, which is also sort of Goody’s argument, and I think there’s a great deal of truth to that, is that the Church wants to weaken any kind of organizations that compete with it for power and control in the local communities. They also have figured out that if you organize society by nuclear families, then a certain proportion of people die without heirs. If they die interstate without heirs, that in many cases, the property that these people own reverted to the Church. Pure naked greed by the Church, which was not unknown in the Middle Ages, I think, was a driver here. Goody convinced me that that actually is a substantial factor.

There are other arguments that have been made in this context, but I think these are the two that are most striking. The other question is, why is it that the clan in China is so convenient for the imperial bureaucracy to rely on? Both of those things happen in parallel. I would think, maybe, if I may allow one observation, in both cases, this is history as historical outcomes, as the unintended and unanticipated consequence of very different actions. There’s no question that the Church never, I think, foresaw the emergence of corporations in Europe, nor do I think that the Chinese imperial service ever seriously considered the possibility how this would change life in China. That’s what happens. You try to follow one objective and then something very different emerges over time. That’s what history is all about.

European Growth

COWEN: Why does it take so long for the wealthiest parts of Western Europe to surpass Chinese living standards? Say that’s happened by 1700 or 1720, that’s many centuries after this medieval divergence. If it takes so many centuries, is the medieval divergence really the relevant factor? Why is it such a slow process?

MOKYR: Yes, I think it is. I think it’s a main factor. I think the idea of looking at standard of living, one thing, I’m very skeptical about how standards of living are actually measured. I know that this is what Pomeranz and other people have, and Jack Goldstone and other people have argued that the living standards in China were comparable to the West as late as 1750. I’m not 100 percent sure that that is true. Certainly, for my money, what really defines the divergence is that, technologically, the gap between the two countries starts to become visible at the time of the Renaissance, in terms of a whole bunch of things that you see growing in Europe and stagnant in China.

Now, keep in mind, of course, that part of the European growth is due to the fact that they borrowed ideas from China. Then the Industrial Revolution consists, to some extent, of imports institution by Europeans trying to mimic the goods that they were importing from China—not just from China, from India as well. Pottery is a good example. One of the things they really wanted from China was Chinaware. That’s why it’s called Chinaware. It took them a while to be able to match the Chinese capability in the ceramic industry, but they do so eventually. Then they stop importing this stuff from China. The same is true for, say, cotton and other products that we’re getting from the East.

European living standards, I think, should be measured, in part, by the fact that when the Europeans start their voyages across the globe in the late 15th and early 16th century, they are able to bring in a whole bunch of new crops and new techniques from other areas which they merely adopt. You’ll see Europeans very soon growing tobacco and potatoes and corn and other things like that. They are the agents of global change. Not only that they change their own diets, they change the Chinese diets because the Europeans bring from the New World things like peanuts and sweet potatoes and things like that. They change the Chinese diets, but the Chinese themselves are not agents here.

They are accepting the stuff that the Europeans did to some extent, and they’re rejecting others, but it’s the Europeans who are the agents of change here. They are the entrepreneurs. They are the people who bring about the changes, Tyler. My sense is that typifies the difference between Europeans and the Chinese. Europeans are more aggressive. They are more outward-looking. In the end, what you see by the 1830s and 1840s, you see that the technological gap is huge, in some ways much larger than the living standards gap. Even in the 19th century, in terms of food, the Chinese were capable of producing enough food. The number of famines in China is probably not a lot worse than in Europe.

When you see what happens during the First Opium War, one English ship is blowing all of this sort of mighty empire to pieces, and the Chinese have to accept this terribly humiliating peace, you can sort of see how the technological gap has grown between the two. For me, that is much more telling than the living standards. The other thing that I should like to point out is that, when you look at Europe in the 16th and 17th century, you can see that the capability of expanding the set of useful knowledge, including science, is just growing very rapidly. Whether there is a scientific revolution or not is a debate that I want to get into.

Certainly, by 1700, Europe is on the verge of really changing our understanding of how creation works. That’s not just Newton and Galileo. There’s a whole body of work that is emerging. There’s really nothing parallel like that in China. China is a very sophisticated society in many ways. The literacy rates are high. They have a well-funded and well-organized system of education, but they don’t really continue their earlier forays into science and into new technology.

Somebody actually went out and looked at Joseph Needham’s many volumes on Chinese technology and science, or Science and Civilisation [in China], as he called it, and he discovered something—which I guess we all knew, but they put numbers on it—almost nothing that Needham pointed out as an innovation happens after 1400. There’s complete stagnation setting in and some of the things that they knew how to make in earlier times, like the sophisticated clocks that they built in the 11th century, they disappear. For me, that’s more telling than how many calories of carbohydrates were consumed on average, if we could ever calculate that correctly.

India

COWEN: How does historic India fit into your schema?

MOKYR: Well, if I may admit it, my knowledge of India and Indian history is probably not up to par. I’m a Europeanist who spent the last five or six years familiarizing myself with Chinese history, but in the last chapter, there is some discussion of India. My sense is that India is a different version of the Chinese clan system. It’s organized differently because you have this combination of clans and caste in India. Basically, they too are unable to create the kind of unique system that you see in Europe, in which you see these nuclear families living in a society which is organized mostly by corporations.

In that sense, I would say, if I may add to that, all of the three great Asian civilizations—Middle Eastern Muslim civilization, Indian Hindu and Muslim civilizations, and China—share something, which in Europe that is the “weirdos.” It’s Europe that are the exceptions. That’s essentially the tenor of Joe Henrich’s book called The WEIRDest People, in which he points this out. That book, I think, has a big influence on us because it really shows, in great detail, how organizing people by nuclear family creates not only a different set of social organization but the culture that goes with it.

Now, I don’t want to draw the analogy between India and China too far, but it’s kind of striking that many of those European corporations are woefully missing in India as well until the Brits show up and, in a way, show them how to do it. Even there, I think it is fairly rare, certainly until 1948, and India becomes independent. The truth is, I did not really want to get too deeply into India because it’s pretentious enough for me to spend a couple of years reading Chinese history without people spending their entire lives on one village or one county. It’s just a huge ocean. I can’t really say that I did more than dipping my toes in it.

Back to Europe and the Industrial Revolution, + Progress

COWEN: Why was there no Industrial Revolution in the Roman Empire?

MOKYR: Oh, God. That’s a huge question.

COWEN: Is it coal? Is it human capital? Is it something else?

MOKYR: Well, I think my sense would be that both Roman and Greek civilizations were, in many ways, creative, but the creativity did never really extend very much into the technological realm. Insofar that they did science, they were mostly uninterested in applying that science to day-to-day problems. That insight, the kind of knowledge that we have about nature, physics, chemistry, biology, astronomy, and so on and so forth, that should be applied toward material improvement, that’s not an immediate and obvious insight, nor is it an immediate and obvious insight that progress, as we understand it today, is feasible and/or desirable.

These are all insights that arose in Europe in the 16th and 17th centuries. I have referred to these things, as you surely know, as what I call the industrial enlightenment. There is this change of mind in European’s thinking after maybe 1450 or 1500, maybe because of the printing press, maybe because of other reasons, but in which Europeans essentially start to convince themselves that they are smarter than anybody that came before them, that a lot of these great Hellenistic and Greek scientists were wrong about many things, and that they could do better.

No! No! No! Not the printing press. Other reasons. See, for example, these blog posts of mine:

Back to the interview:

MOKYR: Once you have that belief—and Francis Bacon and a whole bunch of other people were all in that tradition—in Rome, what you see is a whole bunch of clever people, but they’re not that interested in technology. Let me give you one specific example, Tyler, that I have always found particularly intriguing, although I don’t have a good answer why it happened. If you think about human needs, one of the constants of human needs, above all, is that, at some age, we need glasses. I don’t know when you start wearing glasses, but I started wearing glasses when I was in my early 40s in order to read and things like that. That’s not a cultural feature. That’s something that’s hard-wired in us.

The Romans, certainly the upper class, were literate people, and they had glass, but they never invent spectacles. They don’t have optics, and they’re not interested in optics. There’s this passage in Seneca in which he looks at a glass that has water in it. He says, “Hey, it is interesting. The stuff that’s behind the glass actually is magnified.” But they never take the step of coming up with eyeglasses. You wonder why, because, clearly, if necessity is the mother of invention, this was a necessity. They never do it.

The only thing that you see happening in Rome, and even that was very constrained, is they do come up with water mills, but the water mills remain, by and large, tools for grinding wheat, wine, and corn. They don’t actually take it to the kind of extremes that Europeans did in the Middle Ages, turning it into sawmill and fulling mills, which is why factories were known as mills. They never do that. I think the reason is because the people who made things, the artisans, the workmen, and the people who knew things and studied things, which is the scientists and the mathematicians and the teachers, never talked to each other.

What’s more, the scientists essentially looked upon hard work and manual labor with a great deal of contempt. Both Plato and Aristotle make these points, but the Romans took it over. It was a slave society. Slave societies often look at manual labor with a great deal of condescension. In the end, I think that’s what stopped them. The other thing is, I think that if you don’t have a concept of progress and you don’t think that by studying things and investigating things and doing what we would call research in order to make the world a better place, at least from a material point of view, if you don’t have that concept, there’s not going to be an Industrial Revolution.

The Chinese don’t have that concept either. Coming back to China, I looked quite a long time for this. Basically, all the Chinese experts, that I have read, essentially said that the concept of progress is basically absent. Now, that’s a concept that’s emerging in Europe in the 15th to 16th century. By 17th century, it’s quite commonplace. Once you have that, you can sort of see all those smart guys trying to solve practical and pragmatic problems.

When you think about it, the idea of progress presupposes a conception of the future as something that we can influence and in which we can bring about change. It's not just more and more of the same, much less a cyclical return. See these posts:

Now back to the interview.

COWEN: The Romans are very good at infrastructure. You can go see the aqueduct in Segovia or the waterworks in Istanbul, the Roman system of roads. Isn’t there some notion of progress behind those developments with Caesar encountering what we now call Britain, right?

MOKYR: No. I think the idea that they had a concept of progress—they were practical people. They needed to bring water from here to there. They did that. They needed to build roads so that their soldiers could march and occupy the world, or the world as they knew it. I don’t think there is a concept of progress the way we would think of it. It’s sort of an interesting little book that I published in my series, which you may want to look at, about Pliny. This is somebody who really knows Pliny. He really points this out, that Pliny, you cannot find anywhere. Pliny was sort of the type to summarize—essentially, a little encyclopedia of what was known—basically, there is no concept that things were getting better over time. This is a book by Richard Saller. He was one of the great classical scholars of our time.

Essentially, there is no concept of progress in there. There is no concept of progress in any of the Roman writers. Now, some of the engineers, obviously, were trying to make things work better, but it is not really a social movement, and as soon as a problem had been solved, they say, “Okay, we solved that, and that’s it.” Whereas in Europe, it’s never good enough.

There's more at the link.

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