MattPerman.com

  • Contact
  • About
  • Speaking
  • Books
  • Video Highlights
  • Resources
You are here: Home / 5 Liberal Arts / Economics / The Chief Cause of the Wealth of Nations is Not Material at All, but Knowledge and Skill

The Chief Cause of the Wealth of Nations is Not Material at All, but Knowledge and Skill

January 8, 2014 by mattperman

Very, very well said by economist Michael Novak, quoted in Compassion International’s short booklet Poverty:

Economists affirm that the chief cause of the wealth of nations is not material at all, but knowledge, skill, know-how — in short, those acts and habits of discovery, invention, organization, and forethought that economists now describe as “human capital,” which is located in the human spirit and produced by the spiritual activities of education and training and mentoring. Human capital also includes moral habits, such as hard work, cooperativeness, social trust, alertness, honesty, and social habits, such as respect for the rule of law.

As a result, as the booklets says right before this, the true engine of sustainable and transformational development among the poor is the development of people’s internal capacities — knowledge, hope, social connection, diligence, and so forth. It is through fostering the growth of these capacities that people are enabled through their own efforts “to improve their external context.”

This is why helping the poor is about far more than giving fruit baskets at Christmas. Aid, while it has its place and is essential in emergency situations, does not go to the root cause of poverty and that’s why it will never provide the ultimate solution. An exclusively aid-based approach to fighting poverty is based in the false notion that wealth is produced by externals, rather than bringing people empowerment and helping them grow in their capacity to create, identify, and seize opportunities and fight against the oppressive situations in which they often find themselves.

  • Facebook
  • Twitter
  • Google+
  • LinkedIn
  • Evernote

Related

Filed Under: Economics, Poverty

Feedback to the Editor

  • This field is for validation purposes and should be left unchanged.

About Matt Perman

 

I am the director of career development at The King’s College NYC, co-founder of What’s Best Next, and the author of What’s Best Next: How the Gospel Transforms the Way You Get Things Done. This is my personal website where I blog on four of my favorite topics: theology, apologetics, culture, and living in New York City.

Learn more.

Books

See all of my books and publications.

Follow

Twitter | Facebook

Posts by Date

Posts by Topic

Search Whatsbestnext.com

Copyright © 2021 - What's Best Next. All Rights Reserved. Contact Us.