1. Introduction

Abstract

This study highlights the role of economic materialism, i.e., the set of values and personality traits that prioritise the pursuit of material goals, as a cultural phenomenon of significance in relation to economic transformation and development. It presents a model that shows why an endogenous cultural change towards more widespread adherence to materialistic values is both a cause and an effect of productivity growth. This cultural-economic complementarity is a powerful mechanism of endogenous productivity growth; it also determines the prevalence of different cultural values vis-à-vis the prominence of material objectives. The model’s calibration reveals that its outcomes offer a reasonably good fit for the differences in the evolution of income per capita in England and France between 1500 and 1880.