“Journey of Humanity: The Origins of Wealth and Inequality,” Professor of Economics Oded Galor’s second book and his first written for a general audience, was released March 22 in 30 languages. The book tells a narrative of how growth and inequality emerged over the course of human history and discusses the forces that set them in motion, thus explaining Unified Growth Theory, which Galor founded.
During a crowded book launch in Salomon Auditorium on release day, students — including those taking Galor’s course “ECON 1850: Theory of Economic Growth” — professors and others sat in to hear Galor describe the book’s key arguments, propose strategies to target inequality and address questions on the theory.
Galor first pointed to the relatively recent developments of growth and inequality in nations in the context of the whole of human history. Over the past two centuries, there has been a dramatic transformation in the living standard of societies, with a 14-fold increase in global income per capita, longer life expectancy, as well as a divergence in income per capita across countries, he said.
In order to find answers to the mysteries of growth and inequality, Galor turned to the past, beginning with the genesis of humankind. He aimed to discover the fundamental forces that caused societies to transition from a period of stagnation to growth as well as understand what caused the different timings of this transition around the world that have developed into present-day inequality among countries.
The book finds that the primary underlying force that spurred these transitions in human history is technological progress, which has grown faster and faster over time. For most of history, technological progress had a negligible impact on living standards because it was balanced out by population growth, Galor said.
This cycle proceeded until a tipping point in technological progress was reached — around the 1750s and onwards — when human capital, or knowledge primarily in the form of education, “became essential to cope with the changing environment,” he said. Investment in human capital led to a lower fertility rate and decline in population growth that, combined with technological progress, allowed a new phenomenon of sustained economic growth to emerge, he explained.
Along with this explanation of economic growth, Galor proposes in “Journey of Humanity” the main factors that have influenced the rise in inequality among nations. The book finds that geographic characteristics, such as climate and disease, as well as regional cultural traits, like gender bias or a future-oriented mindset, are two of several key factors that can largely account for cross-country inequality in income per capita.
One audience member asked if inequality will inevitably persist as a few countries get ahead with huge economies due to earlier timing of economic growth, leaving other countries lagging behind. The answer Galor offered, and emphasized in the book’s policy takeaways, is that humanity can learn from history to mitigate inequality. “If we understand our roots, we can participate in the design of our future,” he said.
The book proposes that so far, devastating events like the World Wars and the COVID-19 pandemic have not been able to derail the course of humanity, run by technological acceleration and economic growth. It takes the hopeful outlook that the potentially existential issue of climate change today will be no different.
Though technological acceleration has caused climate change through industrialization, it has also spurred innovation through education and a decline in population growth that can mitigate the pace of environmental damage while technological solutions arise, Galor said.
“Journey of Humanity” covers research “spanning my entire career,” Galor said in an interview with The Herald.
Growing up in Jerusalem, “history is part of the upbringing of each individual,” he said, which led him to a “desperation to understand how history and how initial conditions affect behavior, and affect contemporary inequality across individuals … and societies.” Over the course of around three decades, he has worked to develop and test the building blocks of Unified Growth Theory.
“The theory was initially very difficult to penetrate (and) was very sophisticated mathematically,” he said. After developing theoretical assumptions, he spent years collecting historical data and testing empirically so that each element that is critical for the theory is valid.
He was first approached 15 years ago to write a popular science book, but felt his understanding of the theory at the time was not mature enough to communicate to the public. He instead wrote and published his first book “Unified Growth Theory” for academics.
Galor said he has gradually simplified the theory to capture the essence of the human journey as a narrative for non-specialists, a process which he said was helped by teaching undergraduate students at the University.
The book launch also featured Mark Blyth, director of the Rhodes Center for International Economics and professor of international economics, and Glenn Loury, professor of the social sciences and economics, in a conversation with Galor on the book.
Unlike previous books used to teach economic growth, Blyth noted the significance of Galor’s work as not just a “collection of theories” but the joining of them. Unified Growth Theory is a “proper general theory,” which can explain all of these special theories within the field, and can also make predictions about the future, he said.
One challenge to the book which Blyth posed to Galor was on this second aspect — its ability to withstand the test of time. The book is a “very convincing story of a very long theory of human history; can we be confident that (the story) will continue?” he asked. For instance, will education remain the primary means of gaining human capital, he added.
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Galor responded with a prediction that the importance of education will persist but will shift “even more dramatically towards general education” and away from vocational education. As long as technological progress continues to accelerate over time, the economic landscape — including occupations — will further adjust to this rapidly changing world. “The nature of education will be such that it will train us primarily to learn how to think and … navigate the rapidly changing environment,” he said.
Both Blyth and Loury praised Galor for the “audacity” of the scope and ambition of the book. “We should pause for a moment and see what economic science, taken seriously and applied assiduously, can achieve, and I think we do see that … in this text,” Loury said.
We could “give the book to anyone who is feeling down and skeptical at the moment” because of its ultimately optimistic perspective on the journey of humanity, Blyth added.
Some of the strategies Galor used to make the book more accessible and interesting to the public includes using the metaphor of a time machine to transport the reader to different points in human history and providing real world solutions to mitigate inequality.
Galor’s newest research grant allows him to look ahead, with plans to spend the next two years trying to better understand the future trajectory of humanity. He hopes to use the mathematical tools behind Unified Growth Theory to develop better projections on population growth, fertility rates, human capital and whether technological progress will continue in space.