Reply to Greg Clark on China’s Dishonesty

Greg Clark says that cheating in China means that the “bourgeois virtues” I touted in the book of the same name (2006) aren’t the ticket. But cheating was rampant in England in the early seventeenth century, as it is in most poor countries. Look at the Bard’s obsession with dishonesty, in honest, honest Iago, say, or Falstaff’s robbery and exaggerations, or Shylock’s contract and Portia’s quibble. Late in the seventeenth century Quakers and other worthies drove dishonesty underground, and gave us the modern world. The very word “honesty” changed in meaning, from “aristocratically glorious” to “sober and truth-telling.”

To say that China is a counterexample because it “seems set soon to take its place among the developed countries” is strange. At a daily production of $13 a head (the United States now is at $130 a head), it’s going to be a long, long time before China looks “developed.” A German businessman told me that his company finally gave up trying to make a deal because the Chinese kept reopening the negotiations — after the signing. My prediction? Like Japan and Korea and the United States and England, a future China will get very rich when it gives up its rampant culture of “old fashioned greed” — about the same time it gives up its rampant culture of tyranny.

Also from this issue

Lead Essay

  • In this month’s lead essay, Deirdre McCloskey summarizes the argument of her forthcoming book, Bourgeois Dignity: Why Economics Can’t Explain the Modern World. She argues that while the modern world rode an economic tide, the tide did not have economic causes. Changes in thinking and, yes, in rhetoric did the real work. Neither thrift, nor greed, nor the Protestant ethos are at the heart of this transformation, which brought material prosperity to whole classes that had never before known it. A variety of possible causes must be dismissed, she argues, from foreign trade, to legal institutions, to coal. The dignity and liberty of the bourgeoisie are the keys to economic transformation.


  • Gregory Clark argues that cultural or intellectual developments, like the rise of the bourgeois virtues, ultimately can’t explain the modern world. Not only were such virtues around long before the Industrial Revolution, but they have come and gone throughout many different societies over thousands of years. Why, then, did the Industrial Revolution only happen so recently, and only once? Worse, if we accept that cultural changes brought modern prosperity, we face the prospect that future changes in intellectual fashion may rob us of prosperity as easily as it was bestowed. This he finds both unfortunate and, thankfully, unlikely.

  • Matt Ridley makes two connected points: First, surges in creativity and innovation are far from unique. They can be observed throughout history, and they are usually connected to increases in trade and specialization. In this sense, Britain during the eighteenth century was not exceptional.

    Second, however, Britain was exceptional in another respect — it had large reserves of coal, and it began putting them to use. Cheap energy helped ensure that the boom in innovation didn’t die out. Entrepreneurs won out against plunderers in part because they had this resource at their disposal, and because they could make the case for the benefits of innovation so easily. It was only after the switch to a coal-driven economy that wages finally began to rise for the typical British worker. They continue to do so today thanks to coal and to other sources of cheap energy that have since been discovered and exploited.

  • Jonathan Feinstein suggests that the revolution in human creativity is still underway, and that we have not yet fully recognized what it means to be creative. The science of creativity, he argues, is key here, as the creative process is very different from what most people imagine it to be.