Perhaps the LSE could encourage the anthropologists to talk to the economists?

One of the things that we’ve pointed out over the years is the idea that the London School of Economics might want to encourage its anthropologists to wander down the corridor to speak to the economists. Before, you know, making grand economic claims? On the basis that this might prevent certain avibus ovum meets faciem events.

One of the points that Paul Krugman makes in Ricardo’s Difficult Idea is that economies do have to add up. He applies that insight to the idea that wages are not rising with productivity. If that is so then the labour share of the economy must be declining - things must add up - and as the labour share is not (was not when he wrote) then therefore wages must be keeping up with productivity.

The insight is that if this claimed thing is happening, or had happened, then this other related thing must also have happened. Which gives us a simple tool to evaluate claims of things that are, or have, happening, -ed. Take that connected thing which must also have happened as a result of the claim of the first and look for evidence of it. If it hasn’t happened then the original claim must be wrong.

We can, if we wish to be detailed, then go and work out why the claim is wrong but that’s not actually necessary. The absence of the necessarily linked event is all we need to prove - prove note - that the claim is wrong.

Krugman then goes on to point out that the economy is complicated. It’s not always obvious to the non-economist what such a linked and necessary happening is. But then as he doesn’t quite say that’s the good reason to toddle off down the corridor to talk to the economists and ask. Which is, as we say, our advice to the Alma Mater, the London School of Economics.

Jason Hickel of the anthropology department has just released a paper insisting that capitalism lowered the living standards of the population. So much so that it dropped below subsistence level and only rose back up above it once socialist-like redistribution arrived at the beginning of the 20th century.

It’s an interesting claim, certainly, one worthy of analysis. Even if our starting point would be “Well, he would say that, wouldn’t he?” - we might be a little unkind in this but we do think his arguments too often boil down to we must be poor so that we can be socialist. But to take the claim fairly and attempt that analysis.

The rise of capitalism caused a dramatic deterioration of human welfare. In all regions studied here, incorporation into the capitalist world-system was associated with a decline in wages to below subsistence,

Hmm.

Where progress has occurred, significant improvements in human welfare began several centuries after the rise of capitalism. In the core regions of Northwest Europe, progress began in the 1880s, while in the periphery and semi-periphery it began in the mid-20th century, a period characterized by the rise of anti-colonial and socialist political movements that redistributed incomes and established public provisioning systems.

That is the core of the claim.

So, what must also have happened if this is to be true - or have been true? They define subsistence roughly correctly, as one adult wage being enough to support two adults and two children. As both Ricardo and Malthus pointed out that being the requirement for the population to replace itself over the generations. Go below this subsistence level and the population will necessarily fall over time. Equally, if the population is growing then the general living standard must be above this subsistence, replacement, level.

Which gives us our independent test. It is only possible for capitalism to have lowered incomes below subsistence if population fell at that dawn of capitalism. If population grew at that sunrise then the contention is disproven.

Oh. English population started to grow, significantly, in the late 18th century, accelerating all the way through the 19th. A century before that socialism and redistribution. English living standards must have been above subsistence in that period of time.

Well, we might explain it by net migration but no, that sadly doesn’t do it either.

While the number of immigrants entering Britain during the nineteenth century was not insignificant, during every decade after the 1830s, emigration from Britain vastly exceeded immigration. Between 1815 and 1914, approximately ten million people emigrated from Britain.

Net migration figures emphasise our point in fact. For the population to around quadruple from 8 million-ish to 30 million plus also export 10 million means that wages, incomes, simply must, must, have been very much higher than subsistence.

We can make the same test with global population even if that proof is a little weaker. A near doubling between 1800 and 1900 shows that the general condition cannot have been below subsistence.

We have our thing - population - which must have varied in a specific manner if incomes or wages fell below subsistence. Population did not vary in that necessary manner therefore wages and or incomes did not fall below subsistence. QED.

Krugman is correct, economies are complex things but they also have to add up. Economists know this and so does the economics department at the LSE - that’s where we learned all of this after all.

Which is why we repeat our advice to the anthropology department there. Try a little toddle down the corridor to the economics folk just to see if your claims pass that first sniff test. You might find out that there’s necessarily an error in your calculations……population grew at the time you are claiming incomes were below subsistence. This cannot possibly be correct and it’s not reality that contains the error.