The Rational Optimist: How Prosperity Evolves

Matt Ridley's The Rational Optimist is a history of progress based on a simple but unpopular idea: that specialization and markets are the prime movers of progress. In fact, Ridley suggests in his introduction that the answer to the perennial "What makes humans unique?" question is our unique ability to specialize and trade. Instead of catching our own food, making our own shelter, etc (as other animals do), we humans have created a system where everyone can specialize and trade with others who specialize in other things. This means that those best at making houses make houses, those best at making food make food, and by trading, we can each benefit from that which others do and vice versa. Self-reliance equals subsistence: interdependence through trade equals ingenuity and a boom in living standards.

"What?!" you say. What about Rousseau, Marx, Ehrlich, Marcuse, and all of those other critics of society! What about all the stuff we hear about how capitalism exploits the poor, reduces living standards, rapes the environment, etc, etc. The first few chapters of Ridley's book are devoted to showing that, on all fronts, markets have actually produced higher living standards FOR ALL (and especially the poor, as also shown in Sowell'sEconomic Facts and Fallacies), MORE leisure time for all, and - here's the most surprising - better environmental conditions.

The next several chapters are a history of how this progress happened. To be honest, these chapters may be the most dry as they are very detail-laden and repetitive in that they stress the same theme across time - that specialization leads to ingenuity and progress.Read more ›

First, the GOOD NEWS: the sky isn't falling! The world is actually improving dramatically and the pace is quickening. There are abundant facts to prove it. The BAD NEWS predicted isn't true after all. The not-so-good news is that good news doesn't sell newspapers or prime-time ads. So we'll keep on hearing that doomsday drumbeat of horrific predictions from the media, all of it certified by officials of academia and government with an obvious agenda in the vision of impending environmental collapse which can only be averted by comparably drastic intervention. We have a glut of popular books and articles feeding these fears with plausible evidence for the demise of civilization or the planet, but a critical shortage of books like "The Rational Optimist" which challenge that evidence, describe its pathologies, and show where those disastrously coercive interventions will lead, and what they'll cost in human terms. So why risk ostracism in cocktail-party conversation by reading a persuasive contrarian essay which proclaims a heretical optimism in its title?

Well, one reason might be the pleasures of an utterly readable book. Unlike talk-show polemicists, Matt Ridley uses good-natured eloquence, serious erudition and incisive wit to deflate the imminent-disaster scenarios which dominate our evening news, academic and political discourse. Despite its length, the book is remarkable for its brevity and the sheer quotability of its prose. (A reader cribbing zinger quotes will soon have writer's cramp.)

Another reason might be the challenge of unfamiliar ideas, of cleaning the mental attic of the baggage left by cultural osmosis. No book can guarantee final truth, but a fresh perspective can provide plenty of creative stimulation for a skeptical mind.Read more ›

Differentiation of individual activity, specialization and trade are the activities that have enabled humankind to overcome obstacles in the past and advance at a rapid pace. The future should be no different.

According to Matt Ridley, trade was and is the essential element in human progress. He suggests that the first farmers were already traders and used their static location and accumulated inventory to meet hunter-gatherer demand. He also credits the farmer as the creator of property rights. Hunter-gatherer societies are egalitarian sharing the hunt and enforcing non-compliance. A farmer who plants a field expects to harvest it and store or trade the surplus. This, Ridley posits was the origin of private wealth.

Ridley maintains that progress is dependent on idea sharing. As population density increases, the availability of new ideas and differentiation of occupation allows those with extra time to make use of these ideas.

Twentieth century collectivist bias leads one to ask "who was in charge" looking for a central initiator of policy. Ridley suggests that the world is a complex adaptive system, where trade and progress emerged from the interaction of individuals. It was an evolutionary rather than a planned process.

He recounts historical examples of institutional and industrial stagnation from the Bronze Age to British Rail and the U.S. Postal Service. What Ridley says they have in common is an attitude that rewards caution and discourages experiment. A planned economy requires perfect knowledge. The possibility of new knowledge makes a steady state or economic equilibrium model invalid.

He says the Dark Ages were a massive back to the land hippie movement minus the trust funds, similarly the Maoist Cultural Revolution.Read more ›