Is Economic Growth a Positive Sum Game (Jim O'C)

[Brad De Long]

>So says Brad, who must have read Hirschman and Schumpeter. The latter said
>there is war in capitalism only because of atavistic thinking/feeling; that
>trade and accululating money are essentially pacifist activities. Hirschman
>writes convincingly of the "passions" and the "interests" -- the latter
>dominant in capitalism, the former in medieval times, religious states, and
>other irrational forms. He makes clear that the Dutch understood this from
>the start, legitimating Dutch commercial and physical expansionism on the
>ground that the interests subordinated the passions. There are a lot of
>problems with these formulations. One of them is that negative
>externalities are ignored. Economic growth to date anyway hasn't been
>positive sum game because negative externalities tend to be borne by the
>poor or not so well-to-do, while the well-to-do tend to appropriate the
>positive externalities for themselves. The whole process of
>industrialization/economic growth suffocated, poisoned, etc., much of the
>population of Lancashire (latter Pittsburg, etc.) while the well-to-do
>lived on the hill and had trout streams out of harm's way. Positive
>externalities such as come from "clustering" development went to capital.
>In other words, there are huge effects of economic growth the "cost" of
>which doesn't fall on capital but rather the have-nots. One can go a step
>further and add that fast growth hence fast growth of positive
>externalities for the haves were and are possible only because negative
>externalities were also growing fast, which fell mainly on labor, the poor,
>people of color, etc.
>Jim O'Connor

Nevertheless, the first industrial nation--Britain--is the only one 
for which you can plausibly argue that median standards of living 
fell during the process of industrialization. That tells me 
something...

Brad DeLong