ABSTRACT
The subject of my paper, which is actually that of a book I am just finishing, is understanding the process of economic change. We do not understand the process of economic change. We do know a lot of things that are important for the background of this paper. We have evidence about the characteristics of economic performance around the world in the past. We know that over the last 200 years we have experienced in part of the world enormous, unprecedented growth, whether measured in per capita income terms or other indicators of material well-being. We also know that growth has been very uneven. Some countries have been very successful in terms of material well-being and some have been left behind so that more than a billion people live on less than a dollar a day. Additionally, human wellbeing in terms of health has improved and has improved even among poor countries. Life expectancy in the last century has doubled in parts of the world and has increased almost as much even in some poor countries. So on both of these conditions, material well-being and the welfare of human beings, we have had enormous successes. We also have had spectacular lapses. Some societies have not enjoyed these attributes. We also know that in the twentieth century we killed more people in warfare than in probably all of previous history – a sobering notion.
