Geography and Economic Growth

Geography and Economic Growth


Think about some of the biggest and
most prosperous cities you’ve been to. What do many of them have in common? Water. They sit on a major coast or on a major river. This map shows GDP density – how much
GDP is produced per square kilometer. You can see that the coasts of the
US and the areas along the navigable rivers of the Great Lakes
regions are just chock full of GDP. Likewise in Western Europe, in Japan
along the coast of China, and the coast of Australia. Why is this? It’s much cheaper to transport
goods over water than over land. So, Adam Smith argued that access to water reduced the cost of trade and gave
merchants access to larger markets. In turn, larger markets gave merchants
a greater incentive to specialize and to innovate. As a result, civilization grew
where trade was easiest. Even today, countries that are
landlocked are on average poorer than countries that have access to a coast. What’s the most landlocked
continent of all? It also happens to be the continent
with the most poor countries. Africa. First off, Africa is enormous. You can fit most of the United States,
China, India and a lot of Europe into Africa. That’s big. Second, Africa is landlocked.
While Africa is far bigger in total size than Europe, if you just measure the coastline, Europe
has 2 to 3 times more coastline than does Africa. And because Africa is big and landlocked,
trade is more expensive, and economic growth, slower to start. What we learned from this foray into
civilization and geography is 2 things. First, being landlocked is like a natural tariff,
a natural tax on trade. And if natural tariffs are bad for growth, then perhaps tariffs created by governments
aren’t that great for growth either. Second, growth is not just about policy. Some places have natural blessings
that have helped those places to prosper. And that too helps us understand our world. [Announcer] If you want to test yourself,
click “Practice Questions”. Or, if you’re ready to move on,
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21 Comments

  1. Agata Lukaszova says:

    Very good video, thanks

  2. Alfred Marstorp says:

    Not sure if Africa is the best example you could have used, but you made your point clear enough

  3. Send A Raven says:

    Sounds like something Jared Diamond would proclaim.

  4. zinxin says:

    What would you say is the clearest case of an exception to this rule?

  5. Sara Romaniega says:

    Hi, I wonder when you are going to upload new videos of Principles of Macroeconomics, they are fantastic, but there are few videos. Thanks

  6. MarceloCG says:

    In this case, why the countries in the coast of Africa don't prosper?

  7. Law19157 says:

    I'm willing to bet that if a land locked African Country did a better job with it's rule of law and established a sales tax only tax code, the sales tax being around 15% to 20% & 10% for exports, along with Free Trade and no Tariffs they would see a major boost to their economic growth. What Corporation wouldn't want to be in a country with zero corporate taxes? and what rich person wouldn't want to retire in a zero income tax country? but that's entirely up to their rule of law, these nations tend to be in constant state of conflict with bribery being an epidemic, otherwise this economic model would give them an edge against their global competition.

  8. brokecreole says:

    Africa has many long and large rivers and bodies of water to transport anything. But once again the label of poverty without a definition thereby promoting and sustaining the propaganda of Africa as a poor place. If Africa is indeed poor then why is Europe fixed on disrupting the stability of the continent by wanting to control the affairs and resources? Africa apparently has more than "poverty". Europe and America are in love with Africa's riches and love to call the continent "poor" it hides their intentions and keeps people away from discovering their evil deeds.

  9. Kim Loan Le says:

    phim ma

  10. [ FJX - 576 ] says:

    If that guy in Africa's poor, how is he wearing a tuxedo?

  11. UnbEaTabiL pErson says:

    Wrong size of Russia at 1:29

  12. Leonard Titan says:

    How about foreign policy and military dominance, that has dictated the success and exploitation of failing nations on the receiving end, that have syphoned the resources of once great nations for the benefit of nations capitalising on them. Africa could be great with its natural resources if not for the might of corporations and corruption.

  13. LagiNaLangAko23 says:

    You have sea access you trade with the world, you're landlocked, you trade with your neighbors.

  14. Jorge Joaquin Puente Novell says:

    Clearly the geographic conditions are a factor of development, but it is not so determining as institutions and the fact that those countries where colonized and weren't allowed to look for their own economy. As stated by Acemoglu and Robinson, democracy is a turning point for growth and development.

  15. moonchild10210 says:

    This video is inaccurate and short-sighted. Water access doesn't translate to innovation, what does create "innovation" is supply and demand, destabilization of competing markets, propaganda, war, corruption, and imperialism.

  16. lolipedofin says:

    Natural tariffs are wasted, government tariffs are collected and spent on actual things. Of course this doesn't mean heavy tariffs are bad, protectionism and mercantilism are outdated economic policy. I'm not a wonk in this issue, but I'm pretty sure tariffs are still a usable tool in stabilizing the market as well as a form of revenue for the government.

  17. M W says:

    Usury is the root of all evil and leads to a growth compulsion. The cancer of the world.
    A crime against humanity! Back to the roots. Arsonists playing firefighters.

    Georgia Guidestones: "Maintain humanity under 500,000,000 in perpetual balance with nature."
    "Be not a cancer on the earth — leave room for nature — leave room for nature"
    "A total world population of 250-300 million people, a 95% decline from present levels, would be ideal."
    -CNN Founder Ted Turner

    "Growth for the sake of growth is the ideology of the cancer cell." -Edward Abbey
    No growth for the sake of growth, but for the debt and the greed of profit.

    "Usury – The Cancer of the World" /watch?v=3g7Ii3jazAY
    "Usury War on Humanity" /watch?v=FEheU28ea3c
    "Usury – The Real Reason The Jews Would Kill Jesus All Over Again." /watch?v=fEuVsCncs44
    "Jews Uniting Against Rothschild Zionist Bankers NWO" /watch?v=DHO1tDwWdk4
    "It's a Trick, We Always Use It." (calling people "anti-Semitic")" /watch?v=jUGVPBO9_cA

    "What Islam say about Interest/Usury/Riba/Sood? By Mufti Menk" /watch?v=Anfk_pMIQR8

    "Banking – the Greatest Scam on Earth" /watch?v=G9IH-XKQpOI
    "you are shackled to a DEBT SLAVERY system" /watch?v=zhJc4PiVQxo
    "Who Controls All of Our Money?" /watch?v=mQUhJTxK5mA
    "Who Controls the Money Controls the World" /watch?v=YDYfyAQ8lUI
    "Only 3 Countries Left Without a Rothschild Central Bank" /watch?v=R-4Jd0o-Emw
    "International Monetary System – New Economic Slavery" /watch?v=ogqZ6pnWM7o

    "You Are a Debt Slave: The Rigged Monetary System Explained" /watch?v=KoiUTuMAJIQ
    "David Rockefeller speaks about population control." /watch?v=ClqUcScwnn8
    "We're ALL Debt SLAVES – Here's Why" /watch?v=bH-nBcrTwYI
    "Ted Turner Depopulation Plan Exposed (Agenda 21 Openly Admitted!)" /watch?v=4EVodX6lCWA
    "Anonymous: Flaw in the monetary system" /watch?v=74H8YL7nmS4
    "I Want The Earth Plus Five Percent" /watch?v=L11EprAtQf0
    "The Collapse of The American Dream Explained in Animation" /watch?v=mII9NZ8MMVM
    "The Federal Reserve Explained in 3 Minutes" /watch?v=iP9H5fADC0E

    "Economic growth a priority over the national debt?" /watch?v=ktE7CZLYEJA
    "Who Killed Economic Growth?" /watch?v=EQqDS9wGsxQ
    "Greenspan Admits The Federal Reserve Is Above The Law & Answers To No One"
    /watch?v=ol3mEe8TH7w

    "All Wars Are Bankers' Wars" /watch?v=5hfEBupAeo4
    "What Is the Real Secret of the Georgia Guidestones?" /watch?v=CjpGZN742Lc
    "Illuminati Denver Airport Art Murals" /watch?v=d9ZX9qUSm8s
    "Vaccination – to reduce population! (Bill Gates admits)" /watch?v=pjj4Iq-rsNg
    "Codex Alimentarius Explained in 6 min" /watch?v=WAk2blRHdNE

    "World Economy Collapse explained in 3 minutes" /watch?v=LyePCRkq620
    "David Icke Economic Collapse" /watch?v=5VikVig-5wg
    "David Icke – How The Rothschild Family Plan To Crash The Economy"
    /watch?v=hKycRuWnnO4
    "Billionaires Are Preparing For End of The World! Apocalypse Bunkers Built in New Zealand" /watch?v=GQAqGAe7AOg

    "Top New World Order Quotes" /watch?v=MZVP9aHdlQI
    "A New World Order not the law of the jungle" /watch?v=IvjxLN5DfY0

    "Stop abolition of cash – English version" /watch?v=ouNS9QLtg4M
    "TAXES, BitCoin is Bait, FedCoin is the TRAP !" /watch?v=NqSDibCx1SQ
    "Bitcoin & The Mark Of The BEAST | How It' ALL Ties IN ( 2018)" /watch?v=8R2Pz0goOUQ
    "The "Phoenix" New World Currency Revealed" /watch?v=Tl6NxH65mGU

  18. Michael Kummer says:

    Tariffs, natural tax on trade… TAX, as the enemy… Enemy number 1… What happens to the importance of institutions..

  19. PrideDefiler says:

    0:38 – It almost feels like you omitted Korea on purpose? I mean it's a very wealthy and one of the top 10 trading nations in the World.
    Why couldn't you just say East Asia?

  20. Sword says:

    Please learn about GENETICS. Africans have lower quality GENETICS, due to the environments they evolved for not selecting for smart people as much as winter climates.

  21. Soobin Park says:

    I love MRU videos so much!

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