Monday, February 12, 2007

Freedom & Responsibility

Edmund Phelps explores differences in the economic dynamism of Europe and the United States:
It may be that the Continentals finding, over the 19th and early 20th century, that there was little opportunity or reward to exercise freedom and responsibility, learned not to care much about those values. Similarly, it may be that Americans, having assimilated large doses of freedom and initiative for generations, take those things for granted. That appears to be what Tocqueville thought: "The greater involvement of Americans in governing themselves, their relatively broad education and their wider equality of opportunity all encourage the emergence of the 'man of action' with the 'skill' to 'grasp the chance of the moment.'"
The entire piece is well worth reading. I want to note the emphasis on economic dynamism. I think it is important when thinking about economic prosperity to keep a truly dynamic perspective in mind. Prosperity is not just a matter of a sort of static working out of present conditions. Prosperity is truly dynamic, with feedbacks long into the future arising from conditions today. I think prosperity is emergent, not deterministic. I think this is why "large does of freedom and initiative for generations" seems to me to be right on target.

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