Lecture 2: Is this anything new?
The first point for today is whether organizing the world economy on a global scale is
something completely new, or whether it’s actually the continuation and culmination of trends
that have been in place for some time. I want to answer that question with two noes and a yes.
(1) No, it’s not a new thing but the culmination of a historical trend that began hundreds or even
thousands of years ago; (2) No, it’s not a new thing, but the return to something that was first
tried in the late nineteenth and early twentieth centuries; (3) Yes, it’s a brand new thing. It may
have had historical foreshadowings and forerunners, but what we’re now experiencing is possible
only as a result of inventions, chiefly in the fields of transportation and communication, that are
brand new, that are orders of magnitude faster and cheaper than anything that we’ve experienced
in the past. So let me talk about these two noes and a yes.
The development of an international economy is the culminating phase of a
process that began two thousand years ago with the rise of the great Han and Roman empires, and
the trade relations between them and the other Eurasian countries, a process that accelerated with
the development of ocean-going sailing ships around 600 or so years ago. This is in turn part of a
still larger process, the transition from traditional to modern society. Consider two ends of a
spectrum. On the left end, we’ll put what I call traditional society, and on the right end we’ll put
what I call modern society. These are conceived of as polar opposites. Traditional society is
rural. It’s based on the small village. Everybody knows everybody else. Custom and tradition
dictate almost all the interactions of life. There are only a few possible social roles-noble, priest,
artisan and farmer, and well over ninety percent of the population are farmers. Most occupations
are hereditary—your role in life is determined by what your parents’ role in life was. In addition
to fixed social roles, there are fixed gender roles. The role of women is to stay at home and have
children, lots of them. Medical science is barely developed, half of all children die in childbirth
or in the first few years of life, and the rate of maternal mortality is ten percent or so per event.
In other words, the birth rate is very high, but the death rate is also very high, so the population is
low despite the high birth rate. Transportation is slow, dangerous and uncertain, so most people