Chapter 8: Lessons Learned

By development I mean the movement upward of the entire social system, and I believe this is the only logically tenable definition. This social system encloses, besides the so-called economic factors, ... the distribution of power in society; and more generally economic, social, and political stratification; broadly speaking, institutions and attitudes .... The dynamics of the system are determined by the fact that among all the endogenous conditions there is circular causation, implying that if one changes, others will change in response, and those secondary changes in their turn cause new changes all around, and so forth.

- Gunnar Myrdal, 1974.

Gunnar Myrdal. Credit: Uppsala-Bild / Upplandsmuseet, Public domain, via Wikimedia Commons

In this final chapter, we sum up and take stock of our findings.

The first section discusses the lessons we have learnt. Returning to the three main questions formulated in Chapter 1, we summarize the answers suggested in the various chapters. We also relate our approach to various strands of thinking about economic development.

In Section 8.2, we attempt to crystallize the main thrust of our argument in simple empirical fashion. Specifically, we define and compute a Pillars of Prosperity Index, based on empirical counterparts to the central outcomes emphasized by our theory.

We also use the theory - as summarized in the Anna Karenina matrix of Chapter 5 - to predict the values of this index, based on empirical counterparts of the central determinants uncovered by our theory. Comparing the actual and predicted values of the Pillars of Prosperity Index for 150 countries, we learn about successes as well as failures of the theory.

This book marks much more of a start than an end of a research program. In line with that fact, Section 8.3 highlights the provisional character of our findings by enumerating some important omissions and suggesting theoretical and empirical issues for further research.