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- [Don] When we tell the tale

of the hockey stick of human prosperity,
the phenomenon of innovationism

plays a leading role in the story.

Think about it.

The steam engine, indoor plumbing,
penicillin, semiconductors,

air conditioning, automobiles,
TVs, airplanes, desktops,

laptops, iPads,
smart phones, the internet --

the list of brilliant inventions
from the past few centuries is long.

Yet, the number of relatively minor,
unsung improvements

is still longer -- much, much longer.

I'd personally like to give a shout-out
to whoever invented the sealed lunch bag.

You rock.

The great economic historian,
Deirdre McCloskey,

coined the term “innovationism”
to describe this phenomenon.

She contends that it is
the defining feature

of the past 200 or so years
of human history.

Of course, the world had inventors
and innovators before the 18th century,

but they were few and far between.

Compared to today, the world
before the 18th century

was not only very poor, it was also static.

People in, say, 10th century France
or 15th century Sweden

lived their entire lives
without much change.

Their economy, their world,
was pretty much like their parents' world,

which was pretty much
like their parents' world and so on,

for generations on end.

So what caused this orgy of innovation

and the resulting bend
in the hockey stick?

Scholars still debate this question today.

Of course, one important component,

as argued by Nobel economist
Douglass North,

was good institutions,
such as secure property rights,

non-corrupt courts, and the rule of law.

These institutions laid the foundation

for the resulting expansion
of specialization in trade,

which unquestionably fueled
the innovation engine.

However, some scholars contend
that this explanation is incomplete.

For example, some point
to improvements in education,

others to the discovery
of inexpensive access to reliable energy,

like plentiful coal in England.

McCloskey argues that the vital spark
for all of this innovation

was a change in attitudes.

Specifically, the growing appreciation
among ordinary people,

of entrepreneurial innovators,
and of the economic changes they unleash.

Rather than celebrate
conquerors and kings,

people began to applaud
merchants and inventors.

Whatever the answer, getting it right
is of profound importance,

not just because it explains how
we got to where we are today,

but, much more importantly,
because it is crucial

to helping still poor people
reach our high level of prosperity,

as many around the world
are unlucky enough

to live on the handle of the hockey stick.

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