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Published by EH.NET (January 2003) 
 
Joel Mokyr, _The Gifts of Athena: Historical Origins of the Knowledge 
Economy_. Princeton, NJ: Princeton University Press, 2002. xiii + 376 pp. 
$35 (cloth), ISBN: 0-691-09483-7. 
 
Review Essay by B. Zorina Khan, Department of Economics, Bowdoin College. 
<[log in to unmask]> 
 
 
_The Gifts of Athena_ begins with an epigraph from Robert Hooke, a 
celebrated experimental scientist often regarded as "England's Leonardo," 
who died exactly three hundred years ago. Hooke noted that truly productive 
insights were only to be attained by a "Cortesian army, well-Disciplined 
and regulated, though their numbers be but small." Hooke would not have 
hesitated to induct Joel Mokyr into his "Cortesian army," in any one of his 
guises as the Robert H. Strotz Professor of Arts and Sciences and Professor 
of Economics and History at Northwestern; President Elect of the Economic 
History Association; or author of _The Lever of Riches_ (Oxford University 
Press, 1990). 
 
_The Lever of Riches_ is a standard reference for anyone who wishes an 
eclectic and thought-provoking treatise on the economic history of 
technology. _The Gifts of Athena_ updates us on Mokyr's thinking over the 
last decade on the role of knowledge in generating economic growth. Lest we 
become entangled in the fascinating but ultimately insoluble labyrinth of 
epistemology, he immediately limits the scope of inquiry to "useful 
knowledge" related to natural phenomena that can be manipulated to enhance 
economic welfare. Useful knowledge comprises two categories: 
_propositional_ knowledge about natural regularities; and _prescriptive_ 
knowledge or techniques. 
 
Propositional knowledge (denoted by the symbol Omega) refers to generalized 
principles such as natural laws and empirical observations obtained through 
measurement and classification. The concept is not limited to science per 
se, but also extends to mechanics, geography, engineering, and socially 
constructed beliefs that might be incorrect, such as my grandmother's 
conviction that exposure to evening dew caused ague. Collective knowledge 
ranks more highly than what any individual knows, and raises the key 
question of how individual knowledge is diffused and aggregated into the 
public domain. Improvements in Omega knowledge are due to discoveries of 
facts that had always existed but were previously unknown, and provide the 
epistemic base for the set of prescriptive knowledge. Prescriptive 
knowledge (denoted by the symbol Lambda) consists of techniques, 
prescriptions, and instructions, which reside in human memory, artifacts or 
storage devices. Indeed, the patent law makes just such a distinction, and 
awards patents for net additions to the store of prescriptive knowledge 
(inventions) but not for discoveries of the sort that would fall within the 
primary Omega set. 
 
Mokyr envisages the Omega set as a prior constraint, which limits the set 
of feasible techniques: "The obvious notion that economies are limited in 
what they can do by their useful knowledge bears some emphasizing simply 
because so many scholars believe that if incentives and demand are right, 
somehow technology will follow automatically" (p. 16). As of January 2003, 
we do not have a cure for AIDS or the secret to cold fusion; such knowledge 
might or might not exist, but effectively the only important fact is that 
we do not currently have it and this constrains our current welfare. The 
components of this set also influence the costs of acquiring or using 
techniques. If a solution to an industrial problem is found through 
serendipity but the underlying principles are unknown, the cost and 
riskiness of replication tend to be high. The conceptual system is 
completed by pointing out that feedbacks can occur when the body of 
prescriptive knowledge serves to increase the set of propositional 
knowledge. 
 
Mokyr then poses the question that the untutored reader undoubtedly will 
ask: why do we need to know a theory of knowledge? The rest of the book 
provides an answer: the advances in welfare that we enjoy today are the 
legacy of a revolution in knowledge that occurred some three hundred years 
ago in Western Europe. The credits for its intellectual origins are shared, 
but in terms of its economic exploitation Britain led the way and other 
countries followed. The role of useful knowledge in this process is 
illustrated in chapters that center on the British Industrial Revolution, 
the factory system, health and the household, political economy, and 
institutions in relation to technological change. 
 
Growth episodes did occur before the first Industrial Revolution, but were 
subject to negative feedback mechanisms that ensured the spurts were 
short-lived. For instance, rent-seeking guilds raised monopoly barriers and 
other coalitions suppressed the diffusion of vital technological knowledge. 
However, the most important obstacle to self-sustaining growth was the 
narrow base of propositional knowledge in such areas as agriculture, 
transportation, power, and medicine. Thus, when the Industrial Revolution 
did occur, it was due to what Mokyr calls an "Industrial Enlightenment." 
Expansions in the base of propositional knowledge, and a positive feedback 
mechanism between the two types of knowledge, proved to be critical. Those 
who focus simply on pure scientific discoveries miss much of the point, 
since valuable knowledge was also drawn from a combination of _tatonnement_ 
and conscious insight. In the eighteenth century, exogenous discoveries 
about nature, changes in artisanal knowledge, and greater access to 
information combined with new inventions to create productivity advances. 
 
Mokyr emphasizes the importance of access to knowledge, and argues that the 
Industrial Revolution was accompanied by a revolution in information 
technology throughout Britain, France, Germany and Scandinavia. Scholars 
communicated with investigators in other countries; experts, consultants 
and other specialized professionals cooperated and transmitted knowledge by 
varied means including  
networks, job mobility and industrial espionage. The cost of access fell 
partly due to innovations in postal services, improved transportation, 
greater availability of cheap reading matter, and standardization of 
information such as in the use of mathematics as a means of communication. 
Access to knowledge also became more systematic, as in the spread of 
alphabetization, compilations of technical material in encyclopedias, and 
the Linnaean method of classifying and identifying botanical specimens. By 
the time of the second Industrial Revolution factors that favored improved 
access included an institutional environment that engendered positive 
interactions and the spread of free market principles. 
 
Knowledge and technology also caused changes in the organization and 
location of production from the household to the factory. The competence 
levels required of manufacturing increased and necessitated the application 
of more knowledge than the ordinary household could efficiently generate, 
for "the division of labor is limited by the size of the knowledge set 
necessary to execute and operate best-practice techniques" (p. 140). Other 
explanations of the factory system such as the role of economies of scale, 
transactions costs, and increases in the intensity of work, are not 
regarded as alternatives, but as complementary to this proposition. Apart 
from the efficiencies of specialized knowledge, factory owners had a vested 
interest in adding to the skills and knowledge of their workforce, if only 
to socialize their workers into appropriate behavior. Thus, the factory 
system itself functioned as a conduit through which knowledge was created, 
recorded, and transmitted. The mechanics who worked for Boulton and Watt 
were coveted by competitors because they embodied firm-specific techniques, 
insights and habits. Today, modern innovations in communications and 
information technology decrease the comparative advantage of the workplace 
relative to the household, and offer some workers the prospect of a return 
to household production. 
 
The fifth chapter deals with the household's use of technologies, and its 
"recipes" or additions to prescriptive knowledge. Unlike markets, 
households are not entirely subject to competitive pressures, so we 
unfortunately cannot count on a Darwinian process to ensure the elimination 
of inefficient homemakers. Nevertheless, changes in propositional knowledge 
at the household level can be credited with significant advances in human 
welfare, such as the fall in infectious disease that favorably affected the 
morbidity and survival rates of infants. The results of empirical studies 
regarding sanitation and hygiene had a significant impact on household 
practices and beliefs. Mokyr highlights the "war on dirt," the germ theory 
of disease and the "war on insects," and advances in nutritional science. 
These discoveries diffused due to the "paternalism of the educated classes 
and the greed of commercial salesmen" (p. 188). The working class was 
persuaded by the weight of statistical evidence (some of it incorrect), and 
the judicious example of their social superiors such as the British Ladies' 
National Association for the Diffusion of Sanitary Knowledge to emulate the 
"culture of respectability" (p. 207). These developments shifted the onus 
of dealing with death and diseases from a passive reliance on the 
(unknowable) vagaries of Providence to the (knowable) responsibility of 
individual households. As a result of this change in health-related 
household knowledge, homemakers spent more time in creating nutritious 
meals, a hygienic environment, and caring for children. Indeed, it is 
possible that factors such as "overenthusiastic rhetoric and brainwashing 
by soap commercials" (p. 212) may have led to a suboptimal and excessive 
level of devotion to cleaning and housework. Moreover, this exaggerated 
commitment may have delayed the entrance of some married women to the labor 
force. 
 
The next chapter deals with the political economy of knowledge, and centers 
on two propositions: first, the progress of useful knowledge is far more 
influenced by political economic forces than we realize; and second, 
technological inertia does not indicate that individuals are irrational, 
but may be the outcome of rational choice. Entrenched elites may manipulate 
cultural standards and religious principles to avoid innovations that 
threaten their position. The existence of democratic free market processes 
is no safeguard, and indeed under some circumstances may serve to enshrine 
inefficient technologies to a greater degree than other less desirable 
political systems. The final chapter concludes that "useful knowledge 
mattered." Expansions in the set of useful knowledge can be induced to some 
extent by social agenda, appropriate institutions and relative prices. 
Nevertheless, fundamentally its growth is a function of the _dea ex 
machina_, for there is "a great deal of autonomy to it, which cannot be 
explained in terms of demand or factor endowments" (p. 293). 
 
Starvingmind.Net refers to the "peerless scholarship" of _The Gifts of 
Athena_, for good reason. One is impressed by the plethora of allusions 
drawn from science, economics, history, Greek mythology, studies of the 
effects of fluoride on the tooth decay of Colorado children, household 
hints from _The Woman's Book_ (1911), and some thirty nine pages of 
references. The description it offers of the European experience is superb, 
and a fair reviewer would not fault a work for achieving its aims 
admirably. An editor of my acquaintance insists that what really matters is 
the subtitle, which suggests that this book is about the historical origins 
of the knowledge economy. I cheerfully admit to my biases, but I have 
strong doubts about the relevance of the European experience to 
understanding either the information economy or global technology and 
culture today. 
 
Britain restricted useful knowledge to an elite ("whose numbers be but 
small"), and its institutions functioned in such a way as to prohibitively 
increase the costs of access to the working class. Had the United States 
crafted its own institutions in the image of Britain my counterfactual 
suggests that I would not be typing this review on my own computer, but 
instead would be sharpening a formidable array of pencils. (Indeed, I 
acquired a PC before the British Patent Office did.) Based on comparative 
economic history, I am more sanguine about the effectiveness of efforts 
directed towards inducing increases in useful knowledge unaided by Athena; 
I am less sanguine about the welfare gains from improved access, in the 
absence of institutions deliberately designed to ensure a process of 
democratization. 
 
What does the book have to tell us about the information economy in 2003 
and beyond? As a careful economic historian, Mokyr is reluctant to engage 
in futuristic predictions. He speculates that such large gains in useful 
knowledge were experienced in the 1990s that they possibly amounted to 
another industrial revolution. He highlights the fact that marginal access 
costs have been "reduced practically to zero" (p. 77). However, 
contemporary applications are admittedly not a major focus of the book. So 
perhaps it is once again Robert Hooke who offers us the best insight into 
the ambiguities of the so-called knowledge economy: his classic treatise, 
_Micrographia_ ("humbly" placed at Charles II's "Royal feet à [despite] the 
meanness of the Author, and of the Subject") was printed in 1665 to great 
acclaim; today anyone can have access to the digital edition at Octavo.Com 
-- for a price of $30, or $550 for the "research edition." 
 
 
Zorina Khan is Associate Professor of Economics at Bowdoin College, Faculty 
Research Fellow at the NBER, and a member of the editorial board of the 
_Journal of Economic History_. She has published on the history of patents 
and copyrights, as well as economic history and the law. 
 
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