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Deirdre’s Virtue and Dignity

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One of today’s most creative, insightful, and productive scholars (it does her an injustice to label her simply as an “economic historian” or even as an “economist”), Deirdre McCloskey [2], spoke yesterday at George Mason University.  As always, listening to Deirdre was a thrilling intellectual adventure.  She (quite justifiably) plugged her two latest books. (Here [3] and here [4].)

Among the many things I learned is that, until the industrial revolution, global per-capita income averaged about $3 per day (presumably in 2010 dollars).  Today it averages about $30 per day: a ten-fold increase in access to goods and services.  In the U.S., daily per-capita income is now about $125 per day (and, adjusting for improvements in quality, says Deirdre, closer to $300 per day).

Deirdre also said that she prefers the term “innovation economy” to “capitalism.”  The reason is that accumulation of capital – either physical or human or both – is not the chief cause of the high standard of living in any ‘capitalist’ economy.  The chief cause, instead, is innovation – creative minds free to innovate.  For example [5].

A very Julian-Simonesque [6] point!

In order to meet my Principles of Microeconomics class last night I had to leave Deirdre’s talk just after the Q&A began, so I’m sure that I missed many more insights.