Highly interesting, erudite, and feisty economic history that is in effect a critical primer on attempts to explain the great fact of why massive sustained growth in productivity began only around 1800 and in Britain. McCloskey argues that the Industrial Revolution was not caused by any of the usual suspects--good institutions, high wages, the location of coal, trade, science--but by a shift in ideology to one that respected and permitted entrepreneurialism, innovation, and creative destruction. The negative criticism is done thoroughly and convincingly here; the positive case is presumably built up more thoroughly in the next volume ("Bourgeois Equality")... ( )

This is the second volume in yet unfinished multi-volume magnum opus regarding history of economic development. The first volume, bourgeois virtues was about how, according to the author change in rhetoric and attitudes created the current world as we know it.

The second volume starts with giving a general overview why the growth is so important – chiefly the problem that throughout the human history most people lived at $3 per day (comparative prices of course), but now the average is the factor of sixteen or $50 per day and some western countries that were the leaders, like the Netherlands have over $130 per day. And this doesn’t account properly for the quality of life – from penicillin to internet TV to not burying half of your children.

After setting ‘the great question’ she starts to take apart all existing hypotheses why that happened. It is done, as she honestly admits, because her own hypothesis, that change in rhetoric, namely liberty and dignity, created the modern world, is quite hard to prove. Thus, by disproving the alternatives she ‘cleans the field’ and the following chapters can be viewed as a review and critique of the existing hypotheses.
The following hypotheses are reviewed and disproved, chiefly by counterexamples from other countries and other time periods, which had similar conditions but it hasn’t spurred the growth:
• It is not exploitation of proletariat, actually the poor won more than rich
• It was not the sheer quickening of commerce, commercial revolution was several centuries earlier
• It was not the struggle over the spoils, exploiting new lands by Europeans
• It was not external trade
• The cause was not science
• It was not better allocation
• It was not better genes and eugenic materialism doesn’t work
• It was not accumulation of capital, inheritance fades
• It were not the better institutions, such as those alleged for 1689

It should be noted that the author is not a mainstream economist, she heavily leans toward libertarian views, but she disagrees with them on idea that liberty is enough, for her a social approval, dignity is important as well.
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