NCPA - National Center for Policy Analysis

Stone Age Clues a Key to Economic Disparities, Say Economists

May 10, 2004

Economic disparities between rich and poor nations may be explained by the geography and biology of the Stone Age, according to economists Douglas Hibbs Jr. and Ola Olsson of Goteborg University.

During the time of the hunter-gatherer society 12,000 years ago, no geographic area was any richer than another. After the Ice Age ended, crop growing flourished, transforming societies to sedentary agricultural. But agriculture began earlier in some regions than in others, depending on the diversity of life and geographic factors.

Factors determining the start of agriculture include climate and a region's distance from the equator, and the range of East-West travel in a region, allowing plant and animal species to disperse across wider areas. Superior agricultural production allowed individuals to specialize in farming, while other individuals built modern civilization and institutions.

Taking all these factors together:

  • Economists Hibbs and Olsson believe that about half the variance in economic differences among nations today is explained by geographic-biological differences.
  • The quality of political institutions explains another 30 percent.

Sources: Tom Siegfried, "Wealth of Nations Reflects Stone Age Legacies," Dallas Morning News, March 29, 2004. Ola Olsson and Douglas Hibbs, "Biogeography and Long-Run Economic Development," Department of Economics, Goteburg University, May 13, 2002.

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