One more turn

Six things the creators of Civilizations VII can learn from economic history

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Two weeks ago, Firaxis Games announced Sid Meier’s Civilization® VII, the next iteration of the popular strategy game. Over the last quarter century, I must have played several thousand hours of the Civilization franchise. I first encountered Civ in high school – the iconic High Council of Civ 2 comes to mind! – but it was Civ IV, released in October 2005, a few months before the deadline for my Master’s dissertation, that remains most vivid in my memory.

Here is me in 2014 describing my work habits that December:

Those who know me well, know that one of my secret indulgences is playing Civilization, a computer game that lets you build a virtual empire. I don’t remember when and where I first encountered Civ, but I do remember spending countless hours over weekends and school holidays building my Egyptian, French or Zulu empire. I’m glad that as a student I never owned a computer with the specs necessary to play, as I’m pretty sure it would have cost me another year at varsity. I do remember playing it while writing my Master’s dissertation: for a month, I would write from 5am to 9am, and then play for the rest of the day. I even mentioned Civ in the conclusion of my dissertation, using it as a metaphor to explain why a lack of infrastructure is holding back African development.

Civ VI, the most recent version, has also been a lot of fun and again provided countless hours of entertainment, especially during Covid (and before kids).

But, as an economic historian, the game has always had shortcomings, things that can be incorporated into the gameplay to provide a more realistic simulation of how we arrive at the present. Because, as I also wrote in my 2014 piece, Civ can provide a useful way to think about economic development, both past and in future.

The world is incredibly complex, and simulations help us to explain what the impact of some shock would be. A good macroeconomic model, for example, can explain how an increase in the interest rate should affect other economic variables. Civilization was never meant to simulate the past or the future, but it recently did exactly that: one man who goes by the name Lycerius played a single Civ II game for more than a decade. In the game, he reached the year 3991. What does the future look like? Bleak. He finds himself (playing with the Celts) in perpetual war with the Americans and Vikings, with all other populations annihilated. Communism is the only political system that allows him to constantly make war. Malnourishment and pollution is rife. Sea levels rise. The one positive about this sad state of future affairs is that the game designers did not (and could not) factor in future technological innovations that might alleviate all this misery. Which just shows us the importance of incentivising innovation if we are to survive as a species.

We might not be able to simulate the future, but there are several ways the Firaxis team can help improve simulations of the past. So let me send a few thoughts into the void – most of them based on chapters of my book Our Long Walk to Economic Freedom – hoping that the next iteration might include some of these lessons from economic history.

1. Coercive labour systems

For most of human history, much of society lived under some version of coercive labour arrangement. Free wage labour – the ability to choose where, for whom and for how much you work – is a very recent phenomenon. Economic history can help us understand why it took so long for such economic freedom to emerge. The Nieboer-Domar hypothesis posits that coercive labour systems, such as slavery, serfdom and indenture, emerge when labour is scarce and land abundant. The reason is that the high value of labour under such conditions incentivises land owners to use force (or the threat of force) to secure a stable labour supply. Acemoglu and Wolitzky elaborate on this by developing a principal-agent model, showing that coercion and effort are complements, increasing effort but reducing overall social welfare.¹ In short: better outside options for workers reduce coercion while greater demand for labour increases it.

Of course, incorporating slavery and serfdom into a game must be done in a sensitive way. Yet without the restrictive and exploitative nature of labour coercion, it is impossible to explain – and simulate – humanity’s slow progress towards higher living standards. Firaxis should find a way to incorporate this central, if uncomfortable, feature of our economic history.

2. Pandemics and disease

Plagues and other types of disease were part of the ‘Gathering Storm’ expansion of Civ VI. But given its impact on history, it deserves a more central place. In his 1976 book ‘Plagues and Peoples’, the historian William McNeill argues that the Plague of Cyprian around 250 CE, which killed about half the population, was a significant factor in explaining the fall of Rome. McNeill argues that pandemics like this left the empire with a population too small to sustain its large military and state bureaucracy, making the cities’ demands on the dwindling rural population of farmers and slaves unsustainable. This would be easy to model.

Yet plagues may also have had positive outcomes. The Black Death, the most fatal pandemic in recorded history, claimed more than 100 million lives in Europe and North Africa. Yet scholars link the origins of the Great Divergence and the Little Divergence within Europe to the Black Death, noting its influence on GDP per capita in various regions. One lasting effect of the Black Death was the change in gender relations, for example, with expanded labour market opportunities for women leading to the European Marriage Pattern of later marriages and fewer children in north-western Europe.² Voigtländer and Voth suggest that the high mortality rates increased land-labour ratios, favouring pastoral farming where women had a comparative advantage, resulting in higher marriage ages and lower fertility rates, effects that persisted for centuries.³

Diseases, too, and their economic and demographic consequences must be incorporated. Economist Marcella Alsan’s research shows that ethnic groups in tsetse-fly areas used domesticated animals and the plough less, leading to lower population density. Inhabitants of rainforests had to weigh the benefits of labour-saving, high-yield crops against the costs of diseases that reduced productivity in both humans and animals.⁴ In the Americas, the arrival of smallpox during the Columbian Exchange would have devastating consequences, drastically reducing indigenous populations, disrupting social structures and facilitating European colonisation by weakening the ability of indigenous societies to resist and recover from invasions.

The germs of guns, germs and steel were probably the most important in determining the course of history.

3. Belief persistence

Even though we might think ourselves to be quite exempt from historical influences, to badly abuse a John Maynard Keynes quote, we are usually the slaves of some historical shock.

A wealth of studies in economics now expose how history shapes our beliefs, biases and behaviours. For example, societies historically dependent on tuber crops like yams, which are difficult to expropriate and often grown on small family plots, tend to maintain fragmented political structures and value self-sufficiency. This contrasts with regions cultivating easily taxable grain crops, which supported the development of centralized states and larger, more hierarchical societies.⁵ Or consider how wetland rice farming in China encouraged cooperation by requiring collective effort. This gave rise to strong cultural norms of cooperativeness, as is demonstrated in public goods games today, where participants from wetland rice regions show higher levels of cooperative behaviour and pro-social punishment compared to those from non-rice regions.⁶ Or consider how societies with historical reliance on herding emphasise violence and revenge, have more frequent and severe contemporary conflicts, and their descendants exhibit a greater willingness to take revenge and punish unfair behaviour.⁷

One study finds that our oral traditions reflect salient features of our physical environment.⁸ For example, groups closer to earthquake-prone regions have a higher incidence of earthquake-related motifs, groups on fertile land have more crop-related images, and groups living close to rivers (or in colder climates) have more episodes reflecting their respective landscapes. The folklore thus created has economic consequences. Societies with stories emphasising environmental challenges often develop cultural traits that prioritise resilience and preparedness, while those with tales of abundance may cultivate norms that support agricultural innovation and resource management. Societies with folklore that portray dominant men and submissive women tend to maintain gender inequality, as these stories reinforce and perpetuate the belief in women's subordinate roles both historically and today.

Whether you start the game as a rice or cattle (or yam) farmer, or settle your first city next to a volcano or ocean, should shape your society’s beliefs long into the future.

4. Poverty and inequality

Throughout history, poverty has been the norm, with wealth and high living standards as rare exceptions. Creating and sustaining a prosperous society is incredibly difficult, much like riding a bicycle, which requires constant pedalling to keep moving forward. Without continuous effort, things naturally fall apart and move towards chaos; just like a bicycle, if you stop pedalling, you’ll slow down and fall over. This is why the profound improvement in human living standards in the last two centuries is so remarkable.