6 Killer APP

What caused “the Great Divergence,” the moment when the West surpassed the rest? In
1500, the 10 Western nations that later became empires accounted for only 5% of the
world’s geography and 20% of its income. By 1913, these empires, plus North America,
possessed 58% or the land and produced nearly 75% of global economic output. Experts
often cite imperialism as the reason for Western success. Yet the Ottoman and Mughal
empires failed to produce such dominance, and decolonization was widespread by the
1970s, when the Great Divergence reached its pinnacle. Nor does geography offer a
tenable explanation. The division of Germany into East and West, and Korea into North
and South, provided two “natural experiments.” Although each pairing shared
geographical and cultural similarities, only one nation prospered in each case.

“[The Great Divergence] wasn’t just an economic story...It’s the ideas. It’s the
institutions.”
A blend of six ideas and institutions, or “killer apps,” enabled the West to build
economic power, but they are gaining traction in emerging countries. Western societies
are losing their advantage. The “Great Reconvergence” is underway. These six killer
apps are:

1. “Competition” – In 1500s Europe, numerous “political units” ruled Europe.

Within each unit, corporations and national rulers competed for advantage. This
type of competition didn’t exist in China, whose bureaucratic structure thwarted
ambition.

2. “Scientific revolution” – The experimental method of scientific research

produced discoveries that enabled humans to control nature in new ways. The
Ottoman Empire actively discouraged this type of scientific exploration.

3. “Property rights” – Property rights are a huge differentiator. A look at North

and South America provides a clear example. By 1900, most people in rural
North America owned land. In contrast, outside of an elite few, no one owned
property in Latin America.

4. “Modern Medicine” – Discoveries in fighting infectious diseases during the

late 1800s substantially increased human longevity. Colonies benefited from such
medical breakthroughs but didn’t build on this advantage when they became
independent.

5. “Consumer society” – Mass consumption, spurred by the Industrial

Revolution, fueled Western economic dominance more than any single
technological advance.

6. “Work ethic” – Any country that provides incentives for hard work will enjoy a
strong – often mislabeled “Protestant” – work ethic. Today, citizens of Eastern
societies such as Korea work more hours than the Germans.