The Ecological Origins of Economic and Political Systems

Abstract

We offer a theory that explains variance in global economic development, accounts for its geographic clustering, and shows why these patterns only emerged after 1800. Its mechanics focus on the challenge of survival that faced all societies prior to the 19th century: insuring against starvation. Local factor endowments conditioned how societies could respond to that challenge, thereby shaping pre-1800 forms of social organization. These, in turn, conditioned how rapidly societies could respond to the next challenge of survival they all faced, absorbing a broad suite of mutually dependent, post-1800 technologies that were crucial to geopolitical competition. We develop novel geo-spatial datasets to put the predictions of the theory to the test. We find that a vector of exogenous factors that were binding constraints on food production, transport, and storage within the densely populated nuclei from which nation states later emerged account for 63 percent of the cross-country variance in per capita GDP today. Importantly, this vector accounts for progressively less of the variance in economic development (as measured by urbanization ratios) going back in time; before 1800 they account for almost none of it. We also find that a specific combination of factors that permitted some societies to insure against starvation through local trade is associated with faster economic growth from 1800 to 2000.