From the abstract, it seems that the authors are suggesting that there is an optimum level of genetic diversity, with either too little or too much of it being harmful for economic development.
Here are my own ideas on the general topic, prior to reading either the paper or the response letter.
Genetic diversity is, in general, a good thing for a population, for a simple reason: adaptation via natural selection depends on the existence of variation (there cannot be selection in the absence of alternatives). Other things being equal, a population possessing a greater amount of genetic diversity has a greater probability of already possessing adaptive alleles that might be necessary to meet new environmental challenges (e.g., pathogens).
But, we must also remember that genetic diversity can be partitioned to what is useful, neutral, or deleterious. We ought to be thankful that our Major Histocompatibility Complex (MHC) region is diverse, largely indifferent whether neutrally involving microsatellite loci have higher or lower allele variance in two populations, and a little concerned if there is an abundance of mildly deleterious rare variants sprinkled in our genomes, or a strong-effect disease-causing variant in one locus.
It is by no means clear whether human populations differ, and how they differ in each of these three components. Too much "neutral" diversity is patently irrelevant for economic prosperity; too much "useful" diversity may be helpful, and too much "deleterious" harmful, but I see no particular reason why populations would substantially differ in these two categories.
And, indeed, even the boundaries between the useful/neutral/deleterious categories are blurred. Deleterious anaemia-causing mutations are known to have benefits of malaria-resistance. Neutral variants may be "useful" ones in waiting: for example, lactase persistent mutants may have existed in the human species for hundreds of thousands of years, appearing and re-appearing by mutation, but it is when they encountered cow's milk and the need to drink it that they shifted from "neutral" to "useful". And, even useful alleles can cease to be so, e.g., the eradication of swamps and malaria in Greece has removed the benefit of malaria-resistence, and left only the harm of anaemia.
A different idea that one might consider is that diversity is sometimes harmful: for example, if you are picking a 4x100 relay team or hiring lumberjacks, or recruiting violinists, you don't especially want a genetically diverse group, but rather a restricted subset of phenotypes, and, inasmuch as phenotypes are influenced by genotypes, a restricted subset of genotypes as well: those with efficient fast twitch muscles, upper-body strength, and good pitch/finger dexterity respectively.
But, society is not a one-trick pony, and economies depend on an assortment of abilities. There is no "optimal human phenotype" that is good for all occupations, and most working societies have found ways to channel their diversity profitably, restricting it when necessary (e.g., picking a particular subset to be soccer players, and another subset to be figher pilots), or expanding it when necessary (e.g., assembling test groups that might mirror society, or the world at large).
Personally, I am sceptical of explanations that invoke long-standing evolutionary differences between populations. Such explanations (e.g., involving differences established during Out-of-Africa, as in this paper) have a hard time explaining "sign changes" in the direction of differences over the last few thousand years: China and Mesopotamia, were, by all accounts much more prosperous than most of Europe within historical memory, and the situation is now reversed -although it may be reversed yet again, if current trends continue, at least in the case of China. The people who erected massive monuments on the Americas do not appear to have been poorer than the Japanese of the time. Egypt used to be a breadbasket of Rome, but is now much poorer than Italy. In ancient times, Germans migrated to southern Europe, and during the 20th century many southern Europeans migrated into Germany.
If Out-of-Africa, 100 thousand years ago, sowed the seeds of differential economic prosperity, then these shifts in fortunes over the last few centuries or millennia are difficult to explain.
But, we also don't know that the pattern of genetic diversity observed in modern humans today is the result of Out-of-Africa. Evidence has been slowly and steadily accumulating, that people who live in different parts of the world today are not necessarily the same people of the ones who lived there a few thousand years ago. Migration and admixture have changed the landscape of human genetic variation: migration by expanding "narrow" genetic pools into much wider territories, and admixture by increasing diversity in contact zones.
So, to summarize:
- Genetic diversity can be positive, neutral, or deleterious; boundaries between these categories are fluid, and their apportionment in different populations is uncertain.
- Current differences in economic development are in contrast with such differences in the recent historical past, weakening the case that they stem from events that took place in the distant past (such as Out-of-Africa)
- Current population differences in genetic diversity may have been established by migration and admixture in the recent past, rather than reflecting on events that took place in the distant past.
So, I am rather unconvinced of the hypothesis advanced by Ashraf and Galor. If I find something to add after reading their paper, I will add it here as an update.
RePEc:bro:econwp:2010-7
The "Out of Africa" Hypothesis, Human Genetic Diversity, and Comparative Economic Development
Quamrul Ashraf, Oded Galor
This research argues that deep-rooted factors, determined tens of thousands of years ago, had a significant effect on the course of economic development from the dawn of human civilization to the contemporary era. It advances and empirically establishes the hypothesis that in the course of the exodus of Homo sapiens out of Africa, variation in migratory distance from the cradle of humankind to various settlements across the globe affected genetic diversity and has had a direct long-lasting effect on the pattern of comparative economic development that could not be captured by contemporary geographical, institutional, and cultural factors. In particular, the level of genetic diversity within a society is found to have a hump-shaped effect on development outcomes in the pre-colonial era, reflecting the trade-off between the beneficial and the detrimental effects of diversity on productivity. Moreover, the level of genetic diversity in each country today (i.e., genetic diversity and genetic distance among and between its ancestral populations) has a similar non-monotonic effect on the contemporary levels of income per capita. While the intermediate level of genetic diversity prevalent among the Asian and European populations has been conducive for development, the high degree of diversity among African populations and the low degree of diversity among Native American populations have been a detrimental force in the development of these regions. Further, the optimal level of diversity has increased in the process of industrialization, as the beneficial forces associated with greater diversity have intensified in an environment characterized by more rapid technological progress.
Link
Response to Ashraf and Galor 'The Out of Africa Hypothesis, Human Genetic Diversity and Comparative Economic Development'
Jade D'Alpoim Guedes et al.
Abstract:
This short reply summarizes the concerns of the anthropological community about Ashraf and Galor's (Forthcoming) article in the American Economic Review.
Link
Response to Comments made in a Letter by Guedes et al. on “The Out of Africa Hypothesis, Human Genetic Diversity and Comparative Development”
Link (pdf)







