Outline of Economic History

In order to better understand the actual economic situation and the type of institutional changes and polices that can achieve their perfection, it is important and necessary to go back to our economic history and see the retrospective side of economy to see how humanity got to the point in which it is currently in.

The Difficulties That Existed In Past Times
Throughout most of the history of men, people were not able to obtain much due to their very limited resources. The levels of life were very low and life was poor, short and painful. The following are some of the things that have changed in the past centuries:

  • The level of life of one generation did not overcome the one before. The only ones that were not in this picture were the nobles and everyone else lived near the level of subsistence century after century.
  • The life expectancy at birth was around 25 years of age.
  • Most people would experience horrid diseases and/or hunger.
  • Over thirty percent of all the newborn babies did not live to be five years old.
  • The probability of a woman dying during labor was one out of ten.

All of these things took a great turn around 250 years ago. For the first time in our history, people discovered how to use electricity, complicated machinery, motors, television, the radio, computers, scientific agriculture, biotechnology, antibiotics, aviation and many, many others. Thanks to these discoveries, we have been able to achieve much more with what our environment has which consists of a limited amount of air, land, and water.

The results of these discoveries have caused good effects in our standards of life. We now have a life expectancy of over sixty and a lot of people are able to have a place to live in, clothing, food etc, and it is much more than was conceivable a few hundred years ago.

By this we are obviously not saying that the world is a perfect place now. There is still extreme poverty in a great part of the world and even the riches nations have to confront economic emergencies, such as unemployment and transition of the workers of industries in extinction towards those that are increasing in size.

Non the less it is a fact that the world is a much richer place than it used to be and that we now have sustained economic growth in a good number of countries, which means that the standards of life improve year after year.