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Review of a book by Tim Harford

A review of Tim Harford’s book, Fifty things that made the modern economy.


In 2006 the historian David Edgerton wrote a book called The Shock of the Old in which he argued that the 20th century was not really all about space travel and atom bombs, but humdrum things such as corrugated iron and refrigeration. In this enjoyable book Tim Harford makes much the same point: “An alien engineer visiting from Alpha Centauri might suggest it would be good if the enthusiasm we had for flashy new things was equally expressed for fitting more S-bends and pouring more concrete floors.”

When people discuss innovation they usually focus on the high-tech and brand new. However, the things that made the world we know today are often fairly simple and low-tech. Container shipping, for example, has changed the world far more than molecular biology. It dramatically standardised ports, cutting the price of trade and making distance matter less.

Along with containers, the “cold chain” — which links refrigerated ships to refrigerated trucks to refrigerated shops — was vital to rearranging our food habits and preventing waste. The bar code helped supermarkets to triumph over corner shops (Harford tells us that its first use at a checkout was in 1974 at a Marsh Supermarket in Troy, Ohio, when a ten-pack of 50 sticks of Wrigley’s Juicy Fruit was scanned). Flat-pack furniture — yes, Ikea’s founder gets the credit — has also had profound effects on the way we live. The gramophone destroyed the livelihoods of second-rate singers and began the trend towards winner-takes-all megastars.

Then there are passports. In the 19th century they were on the brink of being phased out. Abolishing them in France in 1860, Napoleon III called them “an embarrassment and an obstacle to the peaceable citizen”. Then along came the First World War and ever since passports have become more and more officious in defining who can travel where. The very size and form of passports, as booklets, was decided in 1921 and has changed little since.

The social implications of innovations take time to emerge. Lifts — or at least reliable elevator brakes — made skyscrapers possible and rearranged cities. TV dinners, more than washing machines, freed women from domestic drudgery. (“Before the washing machine we didn’t wash clothes very often . . . We were willing to stink but we weren’t ready to starve,” says Harford.) The Pill caused women to invest in education and train for high-powered careers much more than before. Willis Carrier’s invention of air conditioning in 1902 made hot places habitable and glass buildings practical. Human productivity peaks between 18C and 21C.

And then there are the old-fashioned software innovations: things such as double-entry book-keeping, a Venetian invention; public-key cryptography; and even management consulting. In 1922 James McKinsey invented the forward-looking budget, which sets goals, broken down department by department. These are what Harford calls “ideas about ideas”. Innovation is not just about tools; it’s about rules too.

Through his Radio 4 programme More or Less, Harford is one of the finest broadcasters of today: he is witty and clever and he does his homework. He is Britain’s answer to the Freakonomics folk and brings much-needed numerical sanity to a madly innumerate world.

This book is based on a radio series, which explains its list-like nature: 50 very short essays on different topics, each introduced with a little human story. It’s a formula that could get wearing, and indeed the anecdotes are sometimes a bit contrived. For example, the invention of radar in the 1930s is introduced by the story of an African flower trader in the 2010s whose employment was interrupted by the eruption of an Icelandic volcano.

On the whole, though, it works well. Books of short chapters are a delight in this frenetic age, and I read these while waiting for meals to cook and in between meetings. Best of all, the book is constantly surprising. It brims with innovations I didn’t know about, as well as ones I thought I knew about but did not.

The chapter on the compiler is especially intriguing. In the early 1950s the mathematician Grace Hopper was working for the Remington Rand corporation. She realised that subroutines — reusable bits of code — could be written in everyday language so that programming a computer could become a matter of using simple instructions in English, rather than numbers or symbols.

It seems such an obvious way to go, but it went against the grain of the computer industry’s high priests. Rebuffed by her boss, she experimented in her spare time, and her compiler evolved into one of the first programming languages, COBOL. Computers have since gone in the direction that Hopper knew made sense: “Freeing up programmer brainpower to think about concepts and algorithms, not switches and wires,” as Harford puts it.

Nonetheless, Hopper faced a struggle to get the idea adopted, as so many innovators did. Harford knows very well that the heroic genius inventor is a largely mythical beast and that most innovation happens gradually, cumulatively and collectively. He writes: “The truth is that even for a single invention it’s often hard to pin down a single person who was responsible — and it’s even harder to find a eureka moment when the idea all came together.”

My biggest quibble with Harford’s book is that he leaves this point largely unexplored, perhaps because telling the tale of the inventor is too good a way of bringing each story to life. The fact that almost every single innovation brings a trail of disappointed rivals in its wake, furiously demanding that they deserve the patent or the prize, sheds light on the curious phenomenon of simultaneous invention.

Elisha Gray and Alexander Graham Bell filed for a patent on the telephone on the same day in 1876. No fewer than 23 people can lay claim to having independently invented the lightbulb in the 1870s. The search engine was bound to have been perfected in the 1990s even if the Google founders had never existed.

It is a baffling paradox that great inventors are dispensable in a way that great artists are not — yet innovation is a rare thing that happens in only a few parts of the world at any time. If Einstein had not existed then Hendrik Lorentz would have discovered relativity, but there would be no Hamlet without Shakespeare and no Mona Lisa without Leonardo. So why did so much innovation happen in China at one time, Italy at another, America at another? This might make a good theme for Harford’s next book.

Fifty Things that Made the Modern Economy by Tim Harford, Little Brown, 343pp, £18.99

The Billy bookcase Ikea makes one every three seconds and there are about 60 million in the world — one for every 100 people.

Lifts China installs 700,000 every year. In 1743 Louis XV installed a secret one to pay visits to his mistress.

TV dinners In 1965 women spent four hours a day doing household chores. Thanks to TV dinners and other domestic innovations it’s down to 45 minutes (lazy men manage a paltry 15 minutes).

Concrete China used more in 2011-13 than the US did in the entire 20th century.

Plastic It’s a blessing and a curse: according to one estimate, by 2050 the plastic in the sea will weigh more than the fish.

Management consulting James McKinsey’s 1922 book Budgetary Control effectively invented the art. Today the world’s consulting firms charge their clients $125 billion a year.

Paper It’s on the way out: in 2013 the world hit peak paper and demand has declined since for the first time.

By Matt Ridley | Tagged:  rational-optimist  the-times