Geography, Diversity and the Origins of the Wealth of Nations

Director: Oded Galor
Research Theme: Development, Institutions and Demographic Change
Funding: NSF

In work with a former student, they test the hypothesis that societies that are either too cohesive or too diverse will grow more slowly than those with an optimal intermediate level of diversity. It is tested using the fact that the process of human migration out of Africa created substantial variation in genetic diversity across the globe, with those populations that are furthest from Africa being more homogenous. The evidence is supportive of the optimal diversity hypothesis and robust to consideration of other hypotheses such as those related to climate or opportunities for trade. In a forthcoming paper they use geospatial variation in soil quality, a measure of the time since the Neolithic Revolution, and a measure of technological sophistication based on historical data to test various aspects of Malthusian theory during the period 1-1500 BC. They find that technological superiority and land productivity had significant positive effects on population density but insignificant effects on the standard of living over this period, as might be predicted in a Malthusian world. This project will advance the hypothesis that migratory distance from the geographical origin of Homo sapiens in East Africa significantly affected the pattern of development across societies.