Charles Francis Adams, JR., one of my favorite characters, preserved with youthful pride the reactions by letter to one of his earliest essays for the Atlantic. One, from an unidentifiable correspondent in Cambridge, expressed a considerable degree of disenchantment with the author's effort.

While the problem of economic development long has been a standard topic for economic historians, it has not been until recent years that most other modern economists have displayed a more dian casual interest in this subject. Two sets of factors have been particularly important in stimulating this new activity. The first, of course, concerns the ever-increasing efforts being made to accelerate economic development in the so-called “backward” regions of the world. Since World War II a number of the countries in the economically backward list have received eitfier complete political independence or a much greater degree of freedom. And one of the major ways they are using this new freedom of action is to plan and undertake extensive governmental development projects. For rightly or wrongly most of these countries feel that their former rulers thwarted the type of economic development most beneficial to the native population, and they are almost fanatically anxious to remedy this condition.

Present-Day economic historians should be well qualified to talk about uncertainty. There was a happier time when the empirical and concrete study of individual situations was deemed sufficient, when mediodological problems of the long run were left for historians to raise and solve if they could and controversies centered on questions that they themselves formulated. Differences there were, but few irreconcilable differences; areas of the unknown were recognized but there appeared to be no gaps in knowledge that could not be bridged in the course of time. Now, for better or worse, this sheltered position has itself become a datum of history. The challenge of social scientists seeking chics to an understanding of die forces shaping secular change has become increasingly insistent and effective; the strenuous wooing of Clio by economic theorists, statisticians, and Parsonian sociologists can no longer be ignored. Assuming that retreat to the shelter of cloistered storytelling is out of the question, creative response on the part of historians to the uncertainties of their twentieth-century environment becomes a condition of leadership in historical inquiry, its lack a virtual guarantee of submergence.

Of The many tasks confronting economic history, none are more shrouded in uncertainty than those encompassed in the theme “Institutional and Cultural Factors in Economic History.” We have in general treated these factors respectfully, but as a profession we have preferred to work in areas more clearly defined and with tools more fully developed. As a result few areas have received less sustained attention than the zones where we must seek the interplay of economic, social, and cultural forces.

The following bit of research has two purposes, one general and one specific. Its general purpose is to suggest how the three elements in its title arc linked together, and in doing this to connect more closely the work of historians, which has focused on entrepreneurship, with that of economists, which has centered around economic growth as measured in statistical aggregates. The specific purpose is to show how the organization of the German coal-mining industry in fact constituted one such connection between the economic activity of individuals and the industrial development of a nation.

Recent interest in promoting the economic development of the so-called “underdeveloped” areas has stimulated concern with the problem of the effects of social anil cultural institutions on economic growth. A major difficulty in the study of this problem is the scarcity of cases of marked economic development in non-Western cultural milieus, Japan being the major striking exception. Under these circumstances it may be of some interest to examine cases of less striking change on a smaller scale, not only for what can be learned about each case, but also for the assistance they may give in interpreting the more numerous cases of little or no economic growth.

Is it possible for an underdeveloped area to construct democratic parliamentary organs as the means of allocating central political authority in a society, simultaneously widi the pursuit of rapid economic development? This is what we shall examine in the following discussion. That the problem is of significance can perhaps readily be conceded. It has implications for the colonial policy of those Western nations that still have large territorial holdings in many diverse parts of the globe. It assumes more crucial significance as colonial empires disintegrate under the combined pressures of economic and political demands by nationalists and as competing ideologies find service in the cause of independence.