The Gifts of Athena: Historical Origins of the Knowledge Economy.

• Author: Boudreaux, Donald J.
• Position: Book Review

The Gifts of Athena: Historical Origins of the Knowledge Economy

By Joel Mokyr

Princeton, N.J.: Princeton University Press, 2002. Pp. xiii, 359. $35.00 cloth, $19.95 paperback.

The first great book in economics focused on what economists today call "the economics of development" or "growth theory." In An Inquiry into the Nature and Causes of the Wealth of Nations, Adam Smith delivered--brilliantly--just what the title of his book promised. In the centuries since that book's publication, however, economists have failed to make significant further progress in understanding economic growth. This failure is both evident and embarrassing.

One reason for the sorry lack of progress in understanding economic growth is that this topic has been dominated by theorists: blackboard buccaneers confident that, armed with impeccable logic, they need not pay serious attention to messy, complex, frustrating reality. It is no surprise, therefore, that most of the best work on economic growth comes from economic historians.

Joel Mokyr, a professor of economics at Northwestern University, is among today's leading economic historians. His knowledge of historical details is imposing, as is his knack for extracting insights from those facts. In The Gifts of Athena, Mokyr aims chiefly to explain why the Industrial Revolution occurred when it did (circa 1750-1830) and where it did (Great Britain) and why it eventually spread throughout the Western world. He rightly recognizes that this event is "the central event of modern history. Nothing else even comes close" (p. 285). Mokyr argues that modern economic growth is the product of an unprecedented expansion and application of "useful knowledge." The claim, as stated, is trite, but in the process of unpacking it, Mokyr's book shines.

He begins by dividing useful knowledge into two categories: "propositional knowledge" and "prescriptive knowledge" (p. 4). Propositional knowledge is general, theoretical knowledge--for example, knowledge of the properties and effects of atmospheric pressure or knowledge of the theory of flight. Prescriptive knowledge is knowledge of technique--for example, how to build a steam engine or how to build a jet plane. According to Mokyr, economic growth springs in large part from institutions and norms that encourage an active, rational search for propositional knowledge and the use of such knowledge for the discovery of prescriptive knowledge.

The practical, applied tinkerer who stumbled...