Modern economic growth is the closest thing to a miracle that economics has to offer. Over the past two centuries, billions have been lifted out of poverty by innovations that increased living standards, breaking the Malthusian trap that for millennia had kept virtually all of humanity chained to basic subsistence levels.
The dynamics behind the sustained expansion of income per capita are the focus of endogenous growth theory, developed, among others, by Nobel laureates Paul Romer, Philippe Aghion and Peter Howitt. But to understand how those dynamics first appeared and took hold, one needs to turn to the work of Joel Mokyr, co-recipient with Aghion and Howitt of the 2025 Nobel Prize in Economic Sciences (Committee for the Prize in Economic Sciences in Memory of Alfred Nobel 2025).
The central transformation at the origin of modern growth is the Industrial Revolution, and Mokyr is its indispensable philosophe. In his thirteen books (with two more forthcoming), a five-volume encyclopedia, and more than one hundred articles, he has reshaped our understanding of virtually every fact and theory associated with industrialisation – from the mechanics of machine design and production processes to the intellectual and political forces that changed entire societies. His characteristic style effortlessly blends deep erudition with precise theoretical framing, mastering an unusually broad register that has earned him full citizenship –and seldom-matched respect – among both historians and economists.
We are two of Joel’s many students who became economic historians thanks to his contagious passion for economic history and his inspiring and generous advising style. Without pretending to do justice to a career of such breadth and consequence, we here review its key milestones.
The Industrial Revolution
The Nobel committee summarised Mokyr’s central contribution as "having identified the prerequisites for sustained growth through technological progress". This was not done in a single work, but rather through a progressive and meticulous account of the processes around the onset of the Industrial Revolution, crystallised in five essential books.
It arguably begins with The Lever of Riches (1990), a deep dive into the literal nuts and bolts of technical change. The book was based on a profound insight: technology was often measured only indirectly. The prevalent ‘sources of growth’ methodology treated technical change as a black box, estimating it as a ‘residual’ – that is, as the part of economic growth that could not be explained by physical inputs such as capital and labour. Mokyr opened that black box with a constructive approach, tracing major inventions since ancient Greece and Rome, and evaluating their role in facilitating growth.
On the basis of a detailed and mesmerising dissection of the key inventions of the industrial age, Mokyr proposes a taxonomy that separates technical breakthroughs into two main types. Macro-inventions are the radical, paradigm-shifting innovations that completely revolutionise the way that things are done. Some classic examples are the steam engine, which transforms thermal energy into mechanical energy; Edward Jenner’s smallpox vaccination process, which protects humans from disease by inoculating them with zoonotic viruses; and hot air balloons, which first enabled humans to fly autonomously.
Micro-inventions, for their part, are incremental improvements that unlock the economic potential of their macro counterparts. In this category, we find James Watt’s separate condenser, which made steam engines financially viable for industrial establishments; and Henry Cort’s puddling and rolling process, which enabled the production of wrought iron at scale.
Mokyr describes the Industrial Revolution as a clustering of macro-inventions leading to an acceleration of micro-inventions. He also identifies a key determinant of Britain’s leading role in industrialisation as stemming from a comparative advantage in the production of micro-inventions.
In The British Industrial Revolution: An Economic Perspective (1993), his editor’s introduction (which comprises roughly half the volume) settles the argument over whether the Industrial Revolution was a gradual change or a sharp discontinuity. Using a simple model in which a small but fast-growing industrial sector co-exists with a large and stagnant agricultural one, he shows how a rapid acceleration in technical change can take decades to surface in macroeconomic aggregates.
A vignette of his classic style is the rebuttal of the claim that change could not have been very abrupt, as contemporaries never mentioned that they lived through an Industrial Revolution. Ancient Romans, Mokyr quips, never mentioned living during Classical Antiquity either.
Propositional and prescriptive knowledge
Why didn’t similar clusters of paradigm-shifting and economically useful inventions appear in other times and places? There had indeed been technical change before industrialisation. Europe in the 16th century was more advanced than the Roman Empire, which was in turn ahead of Babylon. Such progress, however, had been slow and haphazard, never providing more than temporary relief from the Malthusian trap.
In The Gifts of Athena (2002), Mokyr posits a distinction between propositional knowledge – the why things work – and prescriptive knowledge – how they work. In a narrow epistemic context – a dearth of propositional knowledge – most change happened via costly trial and error, with little understanding of why successes worked. In such a world, new inventions and techniques eventually ran into diminishing returns. The social distinctions between those who knew things (savants) and those who made things (fabricants) also hindered the type of cross-fertilisation that could have led to faster progress.
In contrast, the industrial era is characterised by positive feedback loops between propositional and prescriptive knowledge, and by increased communication between savants and fabricants, resulting in sustained scientific and technical progress. As Mokyr writes, such a virtuous cycle was "impossible in earlier days of engineering without mechanics, iron-making without metallurgy, farming without organic chemistry, and medical practice without microbiology". The central drivers behind the Industrial Revolution, he concludes, were the Industrial Enlightenment of the 18th century and the scientific revolution of the 17th century.
Cultural transformation
Why did these technological and intellectual transformations, so central to industrialisation, occur in Europe rather than elsewhere? In The Enlightened Economy (2009), Mokyr advances the argument that the deep roots of economic modernity are not to be found in capital accumulation, resource endowments or the opening of trade routes, but rather in a cultural transformation centred on reason and scientific discovery.
The Scottish Enlightenment instilled the ideas that nature could be known and mastered, and that its laws could be elucidated through scientific research. At the same time, the proliferation of learned societies, periodicals and informal intellectual networks fostered the spread of practical knowledge, linking ‘high’ science and ‘low’ craft.
Invention did not happen because Europeans were more creative than others. Rather, Europeans built a systematic framework that allowed them both to understand nature and to manipulate it for economic purposes.
Britain’s political framework provided security and openness: relatively tolerant of dissenting views, less censorious than continental regimes and supportive of patent law and infrastructure. The benefits were not immediate or evenly distributed, but the new innovation landscape proved sustainable, laying the foundations for modern growth.
England did not industrialise alone: most of the macro-inventions that powered its take-off came from continental Europe. The scientific method itself was first formalised by Galileo, and so many of the advances in mathematics, chemistry and physics that would later be applied to industrial machines originated in France, Germany and beyond. Importantly, however, it was in Britain’s cultural and institutional environment that those ideas coalesced into a veritable engine of growth.
Networks of knowledge creation and diffusion
Why was such a transformation possible in Europe? In A Culture of Growth (2016), Mokyr highlights two elements.
The first was the emergence of pan-European networks of knowledge creation and diffusion. Starting in the Middle Ages, the establishment of universities endowed Europe with rather unique institutions that would eventually specialise in furthering its intellectual development. Though initially rooted in the study of theology and law, and the practice of medicine, they increasingly turned their sights to the pursuit and preservation of propositional knowledge, establishing Latin as a lingua franca in the process.
The invention of the printing press was an additional impetus, reducing the costs of codifying and circulating that knowledge. The new culture of open discussion and sharing of scientific ideas was perhaps best embodied in the vibrant exchanges of the Republic of Letters, a truly transnational community of scientists and craftsmen that paved the way for the Enlightenment.
The second element was Europe’s political fragmentation, which undermined the ability of authoritarian figures to suppress ideas that might threaten their power. Intellectuals could easily cross borders, seeking a new patron whenever the climate in a particular location turned unfavourable to their ideas.
Europe was also lucky to find itself in a Goldilocks zone of sorts in terms of the density and variety of its polities. While the rigid political unitarianism of China stifled, and at times even reversed, technical change, the extreme fragmentation of the Islamic world that followed the destruction of the Baghdad Caliphate also prevented the reconstruction of a network that could effectively connect scientists and innovators. Mokyr’s forthcoming book – Two Paths to Prosperity: Culture and Institutions in Europe and China, 1000–2000, co-authored with Avner Greif and Guido Tabellini – will offer a deeper exploration of this comparative landscape.
Illuminating the path of industrialisation and progress
Taken as a whole, Joel Mokyr’s scholarly trajectory can be thought of as an arc illuminating all aspects of the historical path of industrialisation, from its basic building blocks in the domains of concrete innovations and sectoral impacts, to an overarching theory of its technological, intellectual and cultural underpinnings.
Its message is equally poignant. Economic progress is critically dependent on open intellectual inquiry, on the free exchange of ideas and on a vigorous defence of scientific principles. Coming at a time when such principles are increasingly under attack, the Nobel Prize reminds us that curiosity, pluralism and intellectual cooperation are what created wealthy societies, and that retreating from them puts at risk all the benefits of sustained growth.
Beyond his writings, Mokyr has served the profession in a variety of capacities, including as president of the Economic History Association. At Northwestern University, the Center for Economic History – of which he is a founding director – has established an often-neglected field of inquiry as a vibrant mainstay of academic life.
Perhaps Joel’s deepest influence has come through his more than 60 doctoral students, many of whom have become intellectual leaders in their own right. News of his Nobel award brought indescribable joy to the scores of them scattered around the world. Many will share anecdotes of how Joel’s good offices helped kick-start their careers; the coefficient on a Mokyr dummy in a regression explaining the placement of economic historians is positive, significant and quite large.
Joel’s generosity towards his students, as well as towards countless academic friends and adoptees, goes well beyond his intellectual guidance and his professional sponsorship. He looms larger than life, constantly keeping tabs on his academic offspring; he demands updates on research projects, lobbying for submissions to his Economic History of the Western World book series; and he finds time to share juicy bits of professional gossip, to rant about global developments and small-minded people alike, and to share in personal joys and sorrows.
Even though the laws of physics mean that few of his students and friends can enjoy more than a few hours of Joel’s company in any given year, all are made to feel the warmth of a deep personal connection. There is perhaps no better way to describe it than in his own words: ‘I have no former students; just students.’
References
Committee for the Prize in Economic Sciences in Memory of Alfred Nobel (2025), "Scientific background to the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2025".
Greif, A, J Mokyr and G Tabellini (2025), Two Paths to Prosperity: Culture and Institutions in Europe and China, 1000-2000, Princeton University Press, forthcoming.
Mokyr, J (1990), The Lever of Riches: Technological Creativity and Economic Progress, Oxford University Press.
Mokyr, J (ed.) (1993), The British Industrial Revolution: An Economic Perspective, Westview Press.
Mokyr, J (2002), The Gifts of Athena: Historical Origins of the Knowledge Economy, Princeton University Press.
Mokyr, J (ed.) (2003), The Oxford Encyclopedia of Economic History: five volumes, Oxford University Press.
Mokyr, J (2009), The Enlightened Economy: An Economic History of Britain, 1700-1850, Yale University Press.
Mokyr, J (2016), A Culture of Growth: The Origins of the Modern Economy, Princeton University Press.