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Rudolf Diesel died in mysterious circumstances before he was able to capitalise on his ingenious invention.

It was 22:00. Rudolf Diesel had retired to his cabin aboard the SS Dresden, travelling from Belgium across the English Channel. His nightclothes were laid out on his bed, but Diesel did not change into them.

The inventor of the engine that bears his name was thinking about his heavy debts and the interest payments that he couldn’t afford. In his diary, that date – 29 September 1913 – was marked with an ominous “X”.

Before the trip, Diesel had gathered what cash he could and stuffed it into a bag, together with documents laying bare his financial mess. He gave the bag to his unsuspecting wife, with instructions not to open it until a week had passed.

Diesel stepped outside his cabin, removed his coat, laid it neatly on the ship’s deck, looked over the railings and jumped.

Or did he? Conspiracy theorists have speculated that Diesel was assisted overboard. But who might have had an interest in the impecunious inventor’s demise? Two possible candidates have been fingered.

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50 Things That Made the Modern Economy highlights the inventions, ideas and innovations that have helped create the economic world we live in.

It is broadcast on the BBC World Service. You can listen online and find information about the programme’s sources, or subscribe to the programme podcast.

For context, rewind 40 years, to 1872. Steam supplied the power for trains and factories, but urban transport depended on horses. That autumn, equine flu brought US cities to a standstill. Grocery store shelves were bare and rubbish piled up in the streets.

A city of half a million people might have 100,000 horses. Each one liberally coated the streets with 15kg of manure and 4 litres of urine every day. An affordable, reliable, small-scale engine that could replace the horse would be a godsend.

The steam engine was one candidate: steam-powered cars were coming along nicely. Another was the internal combustion engine, early versions of which ran on petrol, gas, or even gunpowder. But when Rudolf Diesel was a student, both types of engine were woefully inefficient, converting only around 10% of heat into useful work.

The young Diesel’s life was changed by a lecture on thermodynamics at the Royal Bavarian Polytechnic of Munich, where he learned that it was theoretically possible to make an internal combustion engine that would convert all heat into work.

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A plan drawing of the internal combustion engine invented by Rudolf Diesel in 1897

Diesel set himself the task of translating theory into practice. He failed. His first working engine was only just over 25% efficient. Today, the best Diesel engines top 50%. But even so, 25% was more than twice as good as its rivals achieved.

Diesel’s engine is more efficient partly because of how it ignites the fuel. Petrol engines compress fuel and air together, then ignite it with a spark plug.

But compress the mixture too much and it can self-ignite, which causes destabilising engine knock. Diesel’s invention compresses only the air, and more so, making it hot enough to ignite the fuel when it’s injected.

And the higher the compression ratio, the less fuel is needed. Anyone who’s researched buying a car will be familiar with the basic trade-off of a Diesel engine – they tend to be more expensive to buy, but more economical to run.

Unfortunately for Rudolf, in early versions these efficiency gains were outweighed by reliability issues. He faced a steady stream of refund demands from unhappy customers. This dug the inventor into the financial hole from which he could not escape.

Still, he kept working at his engine, and it kept improving.

Other advantages became apparent. Diesel engines can use a heavier fuel than petrol engines – specifically, a heavier fuel that’s become known as “diesel”. As well as being cheaper than petrol to refine from crude oil, diesel also gives off fewer fumes, so it’s less likely to cause explosions.

This made it particularly attractive for military transport. By 1904, Diesel had got his engines into France’s submarines.

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Diesel vehicles tend to be more expensive to buy but cheaper to run

This brings us to the first conspiracy theory around Rudolf Diesel’s death. In 1913 Europe, the drumbeats of impending war were quickening, and the cash-strapped German was en route to London. One newspaper headline luridly speculated: “Inventor thrown into the sea to stop sale of patents to British government.”

It was only after World War One that Diesel’s invention began to realise its commercial potential. The first diesel-powered trucks appeared in the 1920s, trains in the 1930s. By 1939 a quarter of global sea trade was fuelled by diesel.

After World War Two, ever more powerful and efficient diesel engines led to ever more enormous ships. Fuel accounts for around 70% of the costs of shipping goods around the world. Scientist Vaclav Smil argues that steam-powered globalisation would have grown much more slowly than diesel allowed.

The economist Brian Arthur isn’t so sure. He describes the rise of the internal combustion engine over the past century as “path dependence”: a self-reinforcing cycle in which existing investments and infrastructure mean we keep doing things in a certain way, even if we’d do them differently if only we could start from scratch.

As late as 1914, Arthur argues, steam was at least as viable as crude oil for powering cars – but the growing influence of the oil industry ensured that much more money went into improving the internal combustion engine than the steam engine.

With equal investment in research and development, perhaps today we’d be driving next-generation steam-powered cars.

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Diesel’s work on peanut oil anticipated the growing popularity of modern biodiesel

Alternatively, if Rudolf had had his way, perhaps the global economy would run on peanuts.

Diesel’s name has become synonymous with a crude oil derivative, but he designed his engine to use a variety of fuels, from coal dust to vegetable oils. In 1900, at the Paris World Fair, he demonstrated a model based on peanut oil.

He became something of an evangelist and in 1912 – a year before his death – Diesel predicted that vegetable oils would become as important a source of fuel as petroleum products.

A more appealing vision for owners of peanut farms than for owners of oil fields, the impetus to make it happen largely dissipated with Diesel’s death. Hence the second conspiracy theory to inspire a speculatively sensationalist headline in a contemporary newspaper: “Murdered by agents from big oil trusts.”

There’s recently been a resurgence of interest in biodiesel. It’s less polluting than oil fuel, but it’s controversial – it competes for land with agriculture, pushing up food prices.

In Rudolf’s era, this was less of a concern: the population was much smaller, and the climate was more predictable.

Diesel was excited by the idea that his engine could help to develop poor, agricultural economies. How different might the world look today, if the most valuable land during the past hundred years wasn’t where you could drill for oil, but where you could cultivate peanuts?

We can only guess – just as we’ll never know for sure what happened to Rudolf Diesel. By the time his body reappeared 10 days later, it was too decomposed for an autopsy, or even for the crew to be willing to take it on board at all.

Diesel’s wallet, pocket knife and spectacles case were retrieved and later identified by his son. His body was taken by the waves.

Tim Harford is the FT’s Undercover Economist. 50 Things That Made the Modern Economy was broadcast on the BBC World Service. You can listen online and find information about the programme’s sources, or subscribe to the programme podcast.

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