Wednesday, August 24, 2016

Steven G. Marks's "The Information Nexus"

Steven G. Marks is Professor of History at Clemson University. He has written books and articles on Russian economic and cultural history, all with a comparative global focus, including How Russia Shaped the Modern World (2003), on the international reception of Russian ideas, and Road to Power (1991), on the creation of the Trans-Siberian Railway.

His new book, The Information Nexus: Global Capitalism from the Renaissance to the Present, is the summation of his thinking on world economic history and the history of capitalism, subjects he has taught for more than twenty years.

Marks applied the “Page 99 Test” to The Information Nexus and reported the following:
Page 99 of my book points to one of its main themes, namely the close relationship between the state and capitalism. Featuring on that page is Dutch leader William of Orange, who became King William III of England in 1688 after overthrowing his wife Mary’s father, King James II. Although the English were already borrowing fiscal innovations from the Dutch, William’s coup sped up the process, deepening the so-called Financial Revolution. Simply put, the Dutch state, followed by the English, turned to the free market to finance their military operations against Louis XIV’s France and to capitalize their quasi-governmental East India companies. The Dutch Republic and the English crown sponsored the bond market and the stock market in order to raise money that governments previously got through the more limited means of taxation or coercive borrowing (frequently followed by default) from wealthy segments of the society. Thus, the state, far from being a hindrance to the capitalist sector, as many advocates of laissez-faire economics believe, was responsible for the vast expansion of these paradigmatic institutions of capitalism.

For the shares market to function properly, a free business press is necessary. Financial newspapers thrived in early modern Holland and England. Meanwhile, the business press was barely functional in Louis XIV’s France due to strict censorship born of the regime’s fear of dissent, and was non-existent in Asia prior to the nineteenth century. That takes us to the book’s main argument, which is that the sole unique feature of capitalism is an intensity of information collection and processing. As opposed to the “cash nexus,” which the Victorians identified with capitalism, I view capitalism as an information nexus, with strong informational flows between producers, consumers, entrepreneurs, and investors that allow for a maximization of economic activity. The implications are 1. that capitalism is more a function of political than economic liberalism; 2. that informational advantages explain the rise of the West in the early modern era; 3. that our current “Information Age” is not as new as most people think; and 4. that in today’s world nations which block information access cannot be considered capitalist and over time will be less innovative than those which facilitate the information nexus.
Learn more about The Information Nexus at the Cambridge University Press website.

--Marshal Zeringue