Title: Rulers, Religion, and Riches: Why the West Got Rich and the Middle East Did Not
Author: Jared Rubin
Scope: 4 stars
Readability: 4 stars
My personal rating: 5 stars
See more on my book rating system.

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Topic of Book

As the subtitle suggests, Rubin seeks to explain why Europe got rich and the Middle East did not. More specifically, he focuses on why England and Netherlands prospered and why the Arabs, Ottomans and Spanish did not. He argues that which groups the government used to legitimize their rule made a long-term difference in economic development.

If you would like to learn more about how some regions developed faster than others, read my book From Poverty to Progress: How Humans Invented Progress, and How We Can Keep It Going.

Key Take-aways

• All political regimes need outside forces to legitimize their rule.
• Which group plays that legitimization role has a big effect in determining which policies the government implements.
• Those policies, in turn, play a big role in either encouraging or discouraging economic development.
• In the Middle East, rulers used Islam as their major source of legitimacy, so they had to implement policies in alignment with the needs of Muslim religious authorities. These policies stifled the free flow of information and inhibit economic development.
• In Europe, particularly Northern Europe after the Protestant Reformation, the ability of the Catholic Church to legitimize monarchs diminished.
• European leaders had a strong incentive to switch to economic elites as a source of legitimization. In return for their support, monarchs were forced to implement policies more favorable to economic development.
• This created a self-reinforcing dynamic, the more Middle Eastern monarchs relied upon religion to legitimize their rule, the slower the economic growth and the more they needed to rely on Muslim religious authorities. In Northwest Europe, the more monarchs relied upon economic elites, the weaker religion got and the stronger economic growth, creating a virtuous spiral.

Important Quotes from Book

Jared Rubin examines the role that Islam played in this reversal of fortunes. It argues that the religion itself is not to blame; the importance of religious legitimacy in Middle Eastern politics was the primary culprit. Muslim religious authorities were given an important seat at the political bargaining table, which they used to block important advancements such as the printing press and lending at interest. In Europe, however, the Church played a weaker role in legitimizing rule, especially where Protestantism spread (indeed, the Reformation was successful due to the spread of printing, which was blocked in the Middle East). It was precisely in those Protestant nations, especially England and the Dutch Republic, where the modern economy was born.

The argument is hopefully clear about one key point: Islam itself is not the problem. However, economic success is less likely to occur where religion plays an important role in politics. But this is not to lay blame on religion in general, either; any interest group that has a powerful seat at the political bargaining table but does not have interests consistent with economic growth will play a retarding role in a society’s economy. Historically – for reasons emphasized in this book – religious authorities had an outsized seat at the political bargaining table in both the Middle East and Western Europe. Understanding the process through which this was undermined in the latter but not in the former is therefore of utmost importance for understanding the long- run economic divergence between the two regions.

An important difference noted in this book is that Islam is more conducive to legitimizing political rule than Christianity is, a fact that certainly influences the set of changes that are possible in the Middle East. But even if religion is removed from politics, this is only a first step.

In 800, the urban share of the population of the Islamic world was much greater than in Christian Europe.4 Fourteen of the twenty- two largest cities in Europe and the Middle East, including by far the largest city – the Abbasid capital Baghdad – were under Islamic rule.

By 1800, the reversal of fortunes was complete. Seventeen of the twenty most populous cities in the region were not only Christian but located in either Western or Central Europe.

Economists like to think in terms of incentives. This book is no different. At every historical turn, it asks the question: Why did the relevant parties act in the manner they did? The answer given in this book always boils down to: “They were incentivized to act in that manner… The inquiry cannot stop there: simply noting the incentives that individuals face is the last step. It is critical to take a step back and ask: Why were those incentives there in the first place? Why do the incentives people face differ in different places and at different times, and why do they change over time? Why do they sometimes not change over time?

One of its central ideas is that there are people or organizations in society that, due to their identity or access to resources, can help rulers stay in power. I call these people propagating agents. The framework focuses on two types of propagating agents: coercive agents and legitimizing agents. Coercive agents propagate through force – people follow the ruler because they face punishment otherwise – while legitimizing agents propagate through legitimacy – people follow the ruler because they believe he (or, much more rarely, she) has the legitimate right to rule.

Religious legitimation is especially attractive to rulers because it is inexpensive. Thus, rulers rely on religious authorities when those authorities have the capacity to legitimize their rule. In such a world, rulers are loathe to update laws in response to changing economic circumstances if doing so would undermine the religious establishment. As a result, those with the most to gain from modernizing a society’s laws and policies – producers, merchants, and commercial farmers – have little incentive to push for change. Not only are rulers unlikely to side against the religious establishment, but such a request is also a sin. Consequently, laws and policies do not change in response to changes in the outside world, and the result is economic stagnation. This logic indicates that conservatism is a result of the incentives faced by the relevant players, not an ultimate cause of bad economic outcomes.

The circumstances surrounding the births of Islam and Christianity had important consequences for the manner in which rule was propagated. Islam was born in the seventh- century Arabian Peninsula, and it formed as the early Islamic empires were rapidly expanding. Many aspects of Islamic doctrine were a response to this environment, including doctrine supporting a ruler’s right to rule as long as he acted “Islamic.” Christianity, on the other hand, was born in the Roman Empire, with its previously established, well-functioning legal and political institutions. Early Christianity never formulated a corpus of legal or political theory that came close to rivaling that of early Islam for the simple reason that early Christian thinkers did not need to do so.

The framework sheds light on a historical puzzle: while the printing press spread rapidly in Western Europe after its invention by Johannes Gutenberg in 1450, the Ottomans prohibited its use for almost 250 years. The argument for the different reactions to the press is straightforward. The printing press threatened the Ottoman religious establishment’s monopoly on the transmission of knowledge – a key source of their influence in society – and they therefore had incentive to encourage the sultan to prohibit it. The sultan obliged because religious authorities were important legitimizing agents, and permitting the press would have undermined them. Meanwhile, Christian religious leaders were in no position to ask rulers to block the press, and it consequently spread rapidly throughout Europe.

The remainder of the book argues why the Reformation was such an important event for the economic trajectory of Western Europe – and why a lack of a similar undermining of religious authority was important for the trajectory of Catholic Europe and the Muslim Middle East. The primary insight is that the Reformation fundamentally transformed the manner in which rule was propagated. The already weak legitimizing capacity of religion eroded further in Protestant states following the Reformation, forcing Protestant rulers to change the agents that propagated their rule. The most common response was to seek propagation by the economic elites who served in parliaments. By economic elite I simply mean those people primarily engaged in commerce: merchants, craftsmen, money changers, commercial farmers, and anyone else engaged in either producing for market or facilitating market transactions. The transition to propagation by the economic elite was an important development, because their preferences tended to align more with those types of policies that also portend economic success, such as secure property rights and public good provision. Consequently, Protestant rulers more frequently enacted laws and policies favoring long- run economic success than did Catholic or Muslim rulers.

But, while recognizing that there is a correlation between Protestantism and economic success, this book argues for a very different causal channel than one based on culture or religious tenets. It suggests that the changes in political economy brought on by the Reformation – specifically the replacement of the religious elite with the economic elite at the bargaining table – was the key feature connecting Protestantism to economic success.

Related Books

1. “Islam, Authoritarianism and Underdevelopment” by Ahmet Kuru
2. “Why the West Rules-for Now: The Patterns of History” by Ian Morris
3. “Escape from Rome: The Failure of Empire and the Road to Prosperity” by Walter Scheidel
4. “Enlightened Economy: An Economic History of Britain 1700-1850” by Joel Mokyr
5. “The WIERDest People in the World” by Joseph Henrich
6. “A Culture of Growth” by Joel Mokyr
7. “Bourgeois Dignity: Why Economics Can’t Explain the Modern World” by Deirdre McCloskey
8. “The Birth of Plenty: How the Prosperity of the Modern World was Created” by William J. Bernstein
9. “Bourgeois Equality: How Ideas, not Capital or Institutions, Enriched the World” by Deirdre McCloskey
10. “Why Europe?: The Rise of the West…” by Jack Goldstone
11. “Why did Europe Conquer the World?” by Philip Hoffman

If you would like to learn more about how some regions developed faster than others, read my book From Poverty to Progress: How Humans Invented Progress, and How We Can Keep It Going.