« In defence of Bank independence | Main | The freedom-hating right »

October 20, 2016



So Boris Johnson and Neil Farage are sui generis?


Philip Green? Robert Maxwell? Arron Banks? James Goldsmith?

Much of the UKIP-Tory rivalry of the mid-2000s was kept going by the personal rivalry of Stuart Wheeler and Peter Cruddas, who bankrolled the two parties; Cruddas is a billionaire and both are comfortably in the 'tycoon' category.

We don't have any shortage of people who have made so much money that the only thing left to buy with it is political power. The existence of the monarchy is probably the only reason we don't have a Trump or a Berlusconi - by permanently selecting one extremely rich person as head of state, the rest of them are kept from aspiring to the same.


Having smart people leaving the corporate world to people with oversized ego would worry me even more.

Dave Timoney

Unless you believe that intelligence is unevenly distributed among the nations, we should expect to see the same dynamic (smart enough to understand business and smart enough to get out of it) in all countries, so this doesn't explain the particular record of the UK.

Also, reversing the parallel, why doesn't "football mad" England, with its many leagues and distinctive "passion", produce many more excellent coaches than other countries?

It is also surely questionable to claim that the poor performance of British industry is down to a relative dearth of the right sort of CEOs. This is perilously close to "holding out for a hero".

I've long been dubious about Wiener's theory of gentrification (i.e. that anti-commerce aristo values infected the bourgeoisie), not least because it looks like a post hoc ergo propter hoc reading. In the 70s there were plenty who claimed the success of Japanese industry was down to Bushido.

Patrick Kirk

According to Ben Bernanke here, the UK is at 96% of the US standard of living: https://www.brookings.edu/blog/ben-bernanke/2016/10/19/are-americans-better-off-than-they-were-a-decade-or-two-ago/

Given that the US has a bigger home market, does this not mean there is no real UK decline?


@ Rob - yes, plenty of rich men have tried to buy political influence through bankrolling parties.But very few have sought it themselves directly: yes, Goldsmith stood for election, but that was campaigning for a cause rather than just an ego trip. (Banks, Cruddas and Wheeler have quite low public profiles).
@ FATE - my story isn't about differences in IQ. It's about sorting effects caused by cultural differences. As for our lack of good football coaches, part of the problem is the game's obsession with "passion" rather than intellect.

Churm Rincewind

"what does motivate a man to want to keep working once he’s made a few million?"

It's a good question.

Some years ago I fell in the girlfriend of a man worth substantially more than a few million and asked her exactly this question.

Her answer was interesting. She said he was driven by fear - the fear of losing everything.


"I've long been dubious about Wiener's theory of gentrification (i.e. that anti-commerce aristo values infected the bourgeoisie), not least because it looks like a post hoc ergo propter hoc reading."

Me too. It certainly doesn't enjoy a good reputation currently in academic economic history. Some very sophisticated quantitative yardsticks have in fact been developed to measure gentrification with a view to testing Wiener's hypothesis empirically, and the evidence just isn't there. At the very time when, according to Wiener, English industrialists were at their most busy being gentrified, there were in fact hardly any gentrified super-rich in the whole of England with a background in manufacturing. Statistically, by far the most average rich person to newly buy into land in 19th-century England was in fact a London merchant or a London financier.

There are entire (and delightfully well-written) books on this, e.g.


Igor Belanov

As far as the myth of decline is concerned, you need to be looking at Jim Tomlinson and David Edgerton rather than Wiener.

As far as England's lack of good football coaches is concerned, the odd thing is that Scotland has produced so many with such a similar culture. Another curiosity is that England exported many coaches to the continent at one time who had little or no reputation at home. Bob Houghton who led Malmo to the 1979 European Cup Final is one of the last examples, and his one-time collaborator Mr Hodgson looked for a while to be another to add to the list....



Well, if she's letting you just fall in her, sounds like had cause to fear losing her. Whey!

gastro george

Isn't is not just a failure to think long term but also a failure to think structurally or organisationally. You can see throughout our business culture that, while we create good technical products, we fail to develop them or sell them. In short we are a nation of bodgers and fixers. You can see this in our institutions, which are a miscellaneous patchwork of ideas that aren't though through or completed or abolished when obsolete. Our capitalism is beset by value extraction rather than development, an inheritance from our colonial past and their protected markets. It's always easier to make money than make things.


@ Boursin - Thanks for your comment. I take your point. I fear I mis-phrased. I didn't intend to claim that those who choose not to try to become tycoons do so simply because they want to ape the landed gentry, merely that there are (maybe more so in the UK than US) cultural reasons why tycoon mentality is lacking.
One of these might be weaker puritan tradition: puritans believe in work as a virtue so do it when they no longer need the money, whereas others don't.
Ironically, the economic rationality pointed out by Rubinstein might also contribute here. A pure rational maximizer will choose leisure when he's rich; it takes non-economic motives (vanity, love of work, whatever) to keep working.


'As far as England's lack of good football coaches is concerned, the odd thing is that Scotland has produced so many with such a similar culture.'

Scotland and the north east of England have produced world-class coaches/managers until relatively recently. Looking at the social background of these men is quite suggestive - close-knit working class communities involved in coal mining, shipbuilding and heavy engineering, that valued mental toughness, hard work, solidarity, education and initiative. With the decline of these communities and jobs, the production line of great managers (and players, come to that) has tailed off markedly. Hence also the parlous state of Scottish football.


"You have to be smart enough to understand the game, and dumb enough to think it's important.”
No you don't need to think it is important, you just have to know that you get paid well for understanding it (same with any job for that matter).


@ Doug - I agree, and said as much here:
@ reason - you miss the point. I'm thinking of people who are well-off enough to no longer need to keep working; for these, a high wage in itself isn't motivation enough.


Yes I see that point, but there is another point as well. Why do people have passtimes? Not necessarily because people think they are important. I remember once somebody said to me, "How can you be so involved in something as unimportant as sport." And my answer was something like Nick Hornby in "Fever Pitch", "it's precisely because it is so unimportant. Anything really important is too depressing."


I fear you underestimate the impacts of scale.

The large US market means you can rely (more) on Darwinian sorting to find the "fittest" companies. Because the large market provides enough opportunities for entry.

In smaller markets you simply don't get that many entrants, so the countries that do well are those that have a philosophy of improvement (Germany, S. Korea) not those relying on market entry & exit to find talented firms.


Chris the book to read on this is by David Edgerton of Kings College

"Science, Technology and the British Industrial ‘Decline’ 1870-1970 (Cambridge University Press, 1996)?

This is historically rich, model free material that builds up the story from primary material. It is therefore free of a lot of nonsense and distraction.

One thing to keep in mind is that Britain will always face relative decline; that is because developing countries are catching up. But Edgerton argues that Britain absolute decline in technology started in the 1950s, not during WWI as often popularly believed.

The comments to this entry are closed.

blogs I like

Blog powered by Typepad