Cultural Capital and the Productivity of Ideas: Evidence from Historical Texts

Radoslaw Stefanski ()
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Radoslaw Stefanski: University of St Andrews

No 2602, Economics Discussion Papers from Department of Economics, The University of St Andrews Business School

Abstract: Long-run growth is driven by new ideas, yet the cultural environment shaping their production is difficult to measure over time. We use large language models to read 23,000 books from the Western canon and score whether each endorses, rejects, or merely depicts six dimensions of culture. We accumulate the scores into inherited stocks and summarize them with an Innovation Wedge measuring cultural resistance to new ideas. Between 1000 and 1920 the wedge falls by 51 percent. Blinded expert readings and modern surveys validate the measure. An independent 5,000-book archive reproduces the decline. In a calibrated semi-endogenous growth model, the falling wedge raises 1920 productivity to 1.78 times its counterfactual level, explains two-thirds of the first sustained acceleration in productivity growth between 1500 and 1700, and accounts for 38.7 percent of productivity growth in 1920.

Keywords: culture and growth; ideas production; growth accounting; innovation barriers; text as data (search for similar items in EconPapers)
JEL-codes: N13 O31 O41 Z10 (search for similar items in EconPapers)
Date: 2026-07-23
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