The Wealth and Poverty of Nations

Landes, an economic historian at Harvard, explains the divergence in national wealth over five hundred years, arguing that culture is the decisive factor while geography, institutions and contingency all contribute. He states directly that if economic history teaches anything, culture makes almost all the difference, which is the book's most quoted and most contested claim.

The argument covers why Europe industrialised rather than China or the Islamic world. He credits European political fragmentation, which prevented any single authority from suppressing innovation; the development of property rights and of contract enforcement; the Christian attitude toward work and toward the manipulation of nature; the independence of intellectual inquiry from religious authority after the Reformation; and the diffusion of technical knowledge through printing.

He contrasts this with Chinese centralisation, which he argues allowed a single decision to terminate maritime exploration, and with Islamic and Iberian trajectories where he argues that religious orthodoxy suppressed inquiry. His treatment of Spain, which received enormous American silver and industrialised late, is used to argue that resources without the appropriate institutions and culture produce nothing.

The cultural argument has drawn heavy criticism as Eurocentric and as close to circular, since culture is inferred partly from the outcomes it is used to explain. Landes gives limited weight to colonial extraction and to the specific advantages Europe obtained from it. Critics including Pomeranz argue that the divergence was later and more contingent than Landes allows. The historical detail is excellent and the causal argument should be read alongside the institutional and geographic accounts it rejects.