A number of my recent posts have discussed different ways that culture and institutions interact with each other. It’s something I am interested in, and it is one of those areas where I believe historical political economy can really tell us something about the present.
Anywhere you look, culture seems to impinge upon formal political institutions. In the US, Trumpism—very much a cultural movement—has its tentacles in the all three branches of government (not to mention state and local government). In the UK, Brexit was as much a cultural movement as it was a political or economic one. Brazil has Bolsonaro. France has Le Pen. Turkey has Erdoğan. And so on.
One of the similarities between these movements is they did not simply arise in a vacuum. Yet, for the most part, they would have been unthinkable 40 or 50 years ago. And they were not the result of a certain type of elite taking over the political system. They were the result, in part, of decades of cultural change that went against the prevailing institutional and cultural trajectory. That cultural change is now bearing fruit.
Why is this the case? Why might cultural change that pushes against the prevailing institutional headwinds actually succeed in upending that trajectory? Especially when that trajectory is one that largely leads to better economic outcomes?
Are There Historical Precedents?
These were questions that my friend Murat Iyigun and I pondered over coffee at a conference in 2015. This was when Trump was still best known as a reality show host. We were talking about how Turkey’s president Recep Erdoğan was transitioning his politics to appeal to religious conservatives. He had always been an Islamist since he came to power in 2002. But he came to power on the promise of being a moderate Islamist. That changed around 2010, when he increased his religious rhetoric—while also becoming more authoritarian. The two were obviously linked. But was there something more general going on here? Or was it specific to Turkey?
Then came Trump. Then Brexit. Then Trump actually won. At that point, it was clear there was something more general going on. But what? As economic historians, we sought answers in history.
A few examples immediately came to mind. The first, not surprisingly given our interests, was the Ottoman Empire. When confronted with the increasing economic power of Western Europe in the 17th and 18th centuries, there was little attempt to understand why Europe had advanced. Instead, an entire literature was dedicated to extoling the virtues of the past (especially under Suleiman the Magnificent). If only that past could be achieved again, the Ottomans would rise again. Qing China and the Japanese Shogunate provide similar examples of inward cultural turns. Both were once powerful empires that made inward turns when confronted head-on with weakness relative to other powers. Rather than adopt technology, organizational forms, or institutions, they appealed to long-held cultural values—values that maintained their own unique place at the head of the international hierarchy.
The relationship to modern events is obvious enough. Ottoman sultans, Qing emperors, or Japanese shoguns might of well have told their supporters “make the empire great again!”. But how do we explain this? It is nice to have historical parallels, but is there a general theory connecting them?
A Theory of Cultural Revivals
We had some ideas of a theory, but I knew my friend and brilliant theorist, Avner Seror, would know how to model this. He soon joined our team. We set out to think through why culture can impinge on institutional development in a manner that ends up empowering those with interests inimical to economic progress.
The first thing we wanted out of the model was to avoid the traditional political economy explanation of societies failing to keep up: vested interests protecting their rents. Such explanations are powerful and often correct; I have used them in my own work. But that was not the phenomenon we were studying. We were looking at situations in which elites did not have the power to alter institutions to their own benefit. This is precisely when culture can be a powerful tool to maintain power, even against the headwinds of economic and political change.
Our paper, which is now forthcoming at European Economic Review, attempts to model this situation. I won’t bore you here with the Greek letters (if you are interested, you can read the paper!), but the essence of the paper is as follows. Imagine a world with a bunch of people and a few elites. There are two “types”, one of which produces more efficiently than the other. Elites bargain with each other over public good provision. Their relative political weight (and their capacity to steer public goods) depends on the proportion of their type that exists in the population. People try to pass on their cultural trait to their children (a standard way of thinking about cultural transmission!), and spend more resources to do so the more their children will benefit from having their trait. This is a pretty straight-forward way of thinking about how culture and political decision-making may interact with each other.
It follows from this setup that elites who benefit from the sector that is relatively inefficient can still swing both culture and political power in their favor by overinvesting in public goods. This overinvestment incentivizes people with that cultural trait to invest more in transmitting their culture to their child (think, extra Sunday school classes or sending them to a madrasa). In short, political power and culture can reinforce each other, even when it leads to inefficient outcomes. This is what we call a “cultural revival.”
Cultural revivals are not a result of powerful elites preventing change. Indeed, they do not even necessarily occur when the elites who benefit from inefficient production are in the majority. All that elites need to trigger a cultural revival is some capacity to affect cultural change via public good provision (and some other conditions you can find in the model).
Cultural Revivals in the Real World
A model is meant to be general. In any real world setting, there will be complications that do not exactly fit the model. But a good model should provide some intuition into what is going on. So does this model?
In the cases I brought up at the beginning of this post (Trump, Brexit, Erdoğan, Bolsonaro, Le Pen), you can decide for yourself. I think it holds pretty well. In the US, Trumpism was not a flash in the pan, one-time event. It was the long-run outcome of (largely Christian) conservative cultural movements pushing against many of the more liberal cultural and institutional headwinds of the past fifty years. Trump was just its figurehead for the past few years. In Turkey, Erdoğan took advantage of decades of investment in religious schooling (the Gülen movement), which slowly eroded the strict secularism of the Turkish Republic. In each case, we can see with hindsight the cultural winds that led to this moment.
In the paper, we motivate the theory by considering politics in the post-Civil War US South. It was by no means obvious, before the fact, that the white planter elites would maintain their political and economic power following Reconstruction. Poor whites and freed blacks vastly outnumbered the white elites, and the former two groups were mired in poverty. Political changes favoring the vast majority of the (poor) population would certainly have improved the economic prospects of most Southerners. Conceivably, the white planter elites could have lost their political power to any number of groups who tried to unite poor whites and freed blacks into a voting bloc. Indeed, the Populists and Republicans attempted to create such an alliance.
I think our model has something to say about why such an alliance never occurred, and racist cultural norms and institutions ended up ruling the day. (Although I acknowledge there are other convincing explanations, many of which are consistent with ours). Following Reconstruction, the strategy employed by white elites was to provide public goods favoring whites (e.g., segregated schools and hospitals). This was key to creating a more politically salient “white identity” that aligned much of the former Confederacy on racial, rather than economic, lines. After Reconstruction, the salience of white identity enabled white elites to strengthen their grip on the Southern economy and politics. Jim Crow laws were a manifestation of this outcome. In the parlance of our model, a cultural revival of racist values encouraged poor whites to align with white economic elites, This in turn facilitated political changes strengthening the old economic and political structures.
There are many, many other political, economic, and cultural situations to which our model applies. I am sure there are many I have never heard of before (please feel free to contact me if you think of one—I’d love to hear it!). When we take culture seriously, it is hard to see how we can study political economy outcomes without it.