Examples of censorship causing economic decline

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Ottoman suppression of the printing press is sometimes discussed by economists as a contributor to that empire's very long and slow decline:

The Ottomans regulated the printing press heavily to prevent the loss it would have caused to the ruler’s net revenue by undermining the legitimacy provided by religious authorities . . . Although the Ottomans were by no means alone in suppressing the printing press, they sustained printing restrictions much longer than any other ruler in Europe. Even after starting to relax restrictions in 1726, they continued to heavily regulate the operation by granting permission only to selected individuals, prohibiting publication in religious subjects, and appointing a committee of scholars to review and proofread contents for accuracy.

These economists consider the economic impact of this three-century ban to be substantial. In some very technical language, they argue:

The heavy regulation of the printing press is puzzling because the Ottoman sultans could have raised the society's taxable surplus and thus their own revenue by allowing it to operate freely. The new technology would have raised the surplus directly through its effect on the market for books and indirectly through positive externalities that would have benefited other sectors. . . The indirect effects of mass printing on the aggregate surplus would also have been positive through economic development. As Buringh and van Zanden (2009: 409) have argued, books were "strategic commodities [that were] a crucial part of the information infrastructure and, in a way, the 'hardware' which stored all ideas." In the same way, noting the high correlation between reading ability and human capital formation, Baten and van Zanden (2008) have recently used per capita book production as a proxy variable for advanced literacy skills and found a significant relationship between book production and the onset of modern economic growth in Europe. By promoting mass printing technologies, the Sultan would have enhanced the production and accumulation of economic ideas that were essential for economic development and surplus generation.

Obviously, there was more to the Ottoman Decline than the ban on the printing press. Read the Wikipedia article if you want a full rundown of theories. But there is no doubt that retarding the dissemination of literacy and scientific progress at the dawn of the modern era was a bad economic policy.

Source: "The Political Economy of Mass Printing: Legitimacy, Revolt, and Technological Change in the Ottoman Empire." Metin M. Coşgel, Thomas J. Miceli, and Jared Rubin.

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A historical example of "censorship" was the Spanish Inquisition. Spain was a thriving, "progressive" country until the Inquisition took hold, driving out the Jews, and intimidating other "free thinkers." Then Spain began a long decline lasting perhaps four centuries.

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