Hi, everyone. Last week,
we've we've seen that some parts of our world have escaped their eternal economic misery through a process called mothering economic growth.
This process was about generating the technologies which were able to sustain a permanent economic growth in the long run.
However, what we did not answer were a few key questions, which we will discuss in turn.
In this week's videos, first, we know how the world escaped poverty, but we still don't know why the world has remained poor for most of the history.
The key to answer here will be to realise that there are two forces at play.
Technological progress and population growth, and they pull the GDP per capita in the opposite directions.
Second, we do know that the takeover happened in Britain.
But why? Why not Europe? The US, China or Japan?
It will be a simple but powerful economic argument that will employ to arrive at this very interesting question of our economic history.
Third, we saw that firms choose technologies to make profits. But there are thousands of technologies out there.
How does a firm choose the best technology for its own business?
Finally, for a proper economic take off, we need a sustained improvement in technologies, not just a tractor substituting for a hole.
We need that ever more productive tractor or a completely new method of producing that.
The tractor does what the tractor does.
So in other words, one time improvement in the production technology will not cut it.
We need more than that to sustain the growth of living standards observed over the last 250 years.
