Friday, September 2, 2011

Medieval Merchants, Ideas, and Economic Growth


Economists know that a nation's resources have little impact on their wealth. Instead, wealth is derived in the mind's of men.  Specifically, in their human capital: what they know, what they can imagine, what they can record, and their culture of entrepreneurship.

Consider Fibonacci, who taught 13th century Italian merchants how to employ math for mundane business, thereby allowing the merchants to keep track of inventories, balance their accounts, and trade in volumes never before.  Imagine using Roman numerals in accounting for large shipments of imports and exports.  Trade becomes cheaper, and business more efficient.

Consider the world today, where number-crunching is conducted on such a vast scale we must employ computers to aid us.  What Fibonacci gave the world in the 13th century is what computers give us today.

Reference:  Science Friday.  NPR.  August 12, 2011.

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