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Advice From Antiquity

Economic Lessons From Ancient Greece

A statue of ancient philosopher Socrates is seen opposite a Greek flag in Athens, April 23, 2010. Yiorgos Karahalis / Reuters

Greece’s fiscal and economic crisis has sharpened debates among economists, political scientists, and policymakers about political institutions and economic growth. Do good institutions—democracy and the rule of law—promote growth? Or are good institutions only made possible by the prior development of a thriving economy? Major decisions about Greece’s future are likely to turn out quite differently, depending on how policymakers answer this question.

History is the obvious testing ground for the competing theories. But most historical tests of core ideas in political economy have, until recently, focused on the last several hundred years of primarily European history. Limiting the sample for studying the relationship between politics and economic growth to modern states is problematic, however, because factors other than institutional innovation, such as the exploitation of the New World and technological advances, have influenced modern economies. Perhaps ironically, the road to a solution leads back to

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