Unified growth theory

Unified growth theory, founded by Oded Galor, explores the evolution of societies across the entire span of human history.

The theory suggests that forces operating in the distant past have shaped the growth process and determined the differential timing of transitions from stagnation to growth across the globe. For most of human history, technological progress expanded population size but had little effect on living standards. As technological progress gradually gathered momentum, through the mutually reinforcing interaction between population growth, adaptation, and innovation, the increasing importance of human capital in coping with a rapidly changing technological environment prompted parents to prioritize child quality over quantity, triggering the onset of the demographic transition. The decline in fertility freed the growth process from the counterbalancing effects of population growth and, along with advancements in knowledge and education, laid the foundation for sustained economic expansion and modern prosperity.

Yet, variations in deeply rooted institutional, cultural, geographical, and human diversity characteristics contributed to the differential timing of this transformation across societies, giving rise to immense global inequality.