One of the interesting lines of evidence about the importance of human capital in wealth disparities, Emil O. W. Kirkegaard notes, comes from examples of how groups can recover from setback:
The most obvious example are the losers of World War 2, that is, Japan, Germany, and Italy. Japan and Germany suffered extreme damage to their infrastructure in the later stages of the war but were quickly able to recover.
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Some of this research has been done using slaveholders in the former Confederacy, who lost the US civil war (1861-65). These were wealthy people who owned slaves, but lost this wealth. If they were wealthy because of human capital reasons, we would expect them to regain some fraction of this, and their children to markedly catch-up towards their long-term trend.
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For people who had a lot of wealth from slave owning in 1960, their wealth was still reduced in 1870. However, their sons had actually caught back up by 1900. Likewise with the grandsons.
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In his book The Son Also Rises economic historian Greg Clark tracked elite surnames to gauge social mobility across many countries. One of these was China, where the situation was dire.
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However, when looking up modern data for the elite surnames, these are still over-represented among the current elite, despite the efforts of the communists to eradicate their advantages.
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Here some will object that the recovery of the former Axis powers was due to US subsidies (Marshall plan in Europe). The problem with this idea is that wealthy countries have also tried doing the same kind of growth program in other regions of the world, and they have never worked very well.
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Growth has to come from within.
“Growth has to come from within.” The source of common enmity towards inheritance?
The Marshall Plan supported the Allies, particularly England and France. Less than 20% went to Germany and Japan, and that was mostly food. The fact that anything at all went to the German people pissed off the (((officials))) at the State Department.
The official Us Department of State plan for the post-war period was to starve the German people to death. The plan for Japan was, “Let MacArthur do whatever he wants to them.”
Remarkably high correlation.
My Doomerporn™ side senses a lowering of human capital from dysgenic breeding and cultural rot. The race is on to see which dystopian novelist gets closest to what happens.
On the other hand, our American system has for decades used Education to poppy crop or co-opt; we are undoubtedly sitting on an enormous vein of frustrated human potential.
The incoming volcanic explosion will indeed reveal all the ‘human capital’* and ‘growth from within’ you and the next 5000 years of historians could ever want…and far more than you want…and more…
*Human Capital: it’s not even Aspy, it’s Autistic.
(pukes)