Chapter

The Prehistory of American Thrift

Deirdre McCloskey

in Thrift and Thriving in America

Published in print July 2011 | ISBN: 9780199769063
Published online May 2012 | e-ISBN: 9780199896851 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199769063.003.0003
The Prehistory of American Thrift

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An understanding of thrift in the United States requires a look back at developments in England and, before that, in Holland. With the relative leveling of society in the wake of the Renaissance, and especially the Reformation, aristocratic virtues gradually lost their long-held social dominance. In their place arose new commercial and civic virtues that legitimated the rising capitalist order. This chapter shows that the lesson of this early history is not what many have assumed. It questions the oft-repeated assumption that it was an increase in savings due to thrift that drove the rise of capitalism as the dominant economic order in the Anglo-American world. The chapter demonstrates that all of the historical evidence points instead to a combination of relative political freedom and technological innovation that led to the most dramatic economic growth—by a factor of eighteen—in world history. However, it concedes that thrift's social status did change in the period leading up to the Industrial Revolution from an utterly unremarkable feature of human existence to a marker of middle-class respectability and comportment. Along with all the economic virtues, thrift became an important regulating ideal.

Keywords: thrift; early history; savings; political freedom; technological innovation; Industrial Revolution

Chapter.  12846 words. 

Subjects: Economic Sociology

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