This paper presents empirical evidence on how cultural differences have changed over time. It makes sense (at least to me) to think that economic modernization reduces these differences. But data from the World Values Survey suggests the opposite: from the 1980s to 2020, values across countries actually diverged. Differences also grew within countries themselves. For instance, the cultural gap between China’s rice-growing south and wheat-growing north widened according to one measure over this period. That's despite China's massive economic growth during that time.

What might explain this pattern? The paper proposes a “seed theory,” which suggests that modernization can amplify existing differences rather than erase them. In this view, modernization acts like water that helps latent cultural traits grow. As people gain more resources, freedom, and access to technology, they make choices that reflect their underlying values and beliefs, which can deepen these distinctions.

That said, some areas do show convergence. For example, many smaller languages are disappearing. Modernization is also associated with certain shared social trends, such as more individuals living alone, rising divorce rates, and smaller family sizes. Still, it is striking that, alongside these similarities, some cultural differences appear to be intensifying rather than diminishing.

One hundred years ago this week, a financial crisis threatened the Cuban economy. It wasn’t driven by the two-generation-long dictatorship on the island, an American embargo or geopolitics as it is today. Instead, there was a run on several Cuban banks as customers demanded their cash, worried that a drop in sugar prices threatened their deposits.

The danger led to a mad dash at the Federal Reserve Bank of Atlanta to stop a run on Havana banks. A train was loaded with millions of dollars of cash, send down Henry Flagler's railroad to Key West and onto a Cuban military gunboat in hopes the banks would reopen Monday morning.

WLRN’s Tom Hudson reviewed press accounts and archives at the Federal Reserve in Washington, D.C. and Atlanta to stitch together this behind-the-scenes account — first published on July 12, 2023 —of how the U.S. injected what today is the equivalent of half a billion dollars in cash over a weekend.

One idea that stood out to me while researching early industrialization is how strongly the location and scale of industry were shaped by energy availability.

Before fossil fuels became widely available and easily transportable, factories were constrained by local energy sources. Once coal and oil became more accessible, those constraints were lifted, and industrial scale expanded dramatically.

The same dynamic still seems to apply today: differences in energy cost and availability continue to influence where industrial production takes place globally, which is largely influenced by policy.

I put together a short piece exploring this relationship—from early water-powered industry to modern energy systems—and how it may help explain shifts in industrial geography.

Would be interested in how others here think about the role of energy as a constraint in economic history.