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693 reviews for:
Why Nations Fail: The Origins of Power, Prosperity, and Poverty
Daron Acemoğlu, James A. Robinson
3.83 AVERAGE
693 reviews for:
Why Nations Fail: The Origins of Power, Prosperity, and Poverty
Daron Acemoğlu, James A. Robinson
3.83 AVERAGE
informative
reflective
slow-paced
medium-paced
In a rare moment of clarity during the Democratic debate in Nevada, Michael Bloomberg summarized Bernie Sanders’ “Democratic Socialist” policies in a dozen simple words. “Other countries tried that, it’s called communism, and it just didn’t work,” Bloomberg said.
Sanders, who has served in the U.S. Senate as an independent and describes himself as a Democratic Socialist, was actively involved with and endorsed communist members of the Socialist Workers Party over Democratic candidates during the Cold War, despite those candidates having no chance of success.
In the years since, his brand of socialism has gained currency, especially among America’s youth.
In February, a panel of Marquette University students praised socialism on UpFront on WISN-TV. They said the Sanders’ brand of “Democratic Socialism” they’re attracted to is focused on helping people, as opposed to their perception of other forms of socialism.
The chairman of the Marquette University College Democrats said he appreciated hearing Bernie Sanders “champion using the powers of the state and do these things that seemed radical at the time,” like Medicare for All and imposing a $15 per hour minimum wage. “To me, what Democratic Socialism means is bringing the United States into the standard of living that honestly every other industrialized nation in the world experiences right now,” he said.
However, evidence suggests that socialist policies, even the ones implemented with good intentions, backfire on those they’re supposed to help.
That brings me to this month’s RightWisconsin book of the month. In 2012, Daron Acemoglu and James Robinson published Why Nations Fail: The Origins of Power, Prosperity, and Poverty. By making complex economic arguments easy to understand, the authors describe how far-left policies have ruined nations.
At the expense of connecting with the common man, economics has become overly quantitative and difficult to follow. But this book is one of the clear exceptions. The authors simply make the world their laboratory, asking why portions of our globe have so much wealth and much less poverty than other parts of the world.
The obvious variables from one nation to the next can be attributed to culture, weather, and geography. So the authors strip that all away and focus on parts of the world where these variables are largely the same and where there is generally only one big difference: public policy.
The areas examined by the authors include Korea (North versus South), Nogales (U.S. Side versus Mexico side), Berlin (East versus West) and several other examples. The results are clear—the big difference in a nation’s wealth is attributable to democracy, free markets, transparent systems, and an accountable government.
Communism and Bernie’s far-left Democratic Socialist ideas have proven to create less wealth and more poverty. It’s not just wealth, though. It’s also health. South Koreans, who have the same genetic makeup as their North Korean counterparts, are 2-3 inches taller due to the scarcity of nutritious food in the Communist North.
Why Nations Fail was initially published in 2012, and ample new evidence has accumulated to reinforce Acemoglu and Robinson’s claims since then. One is Venezuela, which was the wealthiest country in South America not long ago. The New York Times describes its collapse as one of the worst implosions of a country outside of wartime in decades. It is now among the poorest countries in South America as a result of Sanders-like policies of highly centralized government, lavish social welfare programs, and forced wealth distribution to fund them.
We can also look around our own country. States that have been embracing more limited government policies are experiencing better economic opportunities for those climbing the economic ladder. For example, Vermont ranks #46 for overall freedom in the Cato Institute’s “Freedom in the 50 States” index, while its neighbor New Hampshire ranks #2. Consequently, New Hampshire’s economic strength ranks #13 but Vermont ranks #29, according to U.S. News.
Meanwhile, Illinois (#35 on the Cato index), New York (#50), and California (#48) have lost a net 3.2 million people over the past decade to other states as people flee to places with lower taxes and more opportunity such as Florida (#1), according to a Bloomberg analysis.
If I was teaching economics at a university today, I would assign the following: Choose a place with similar cultures, weather, people, and geography but two different forms of government. Then identify what political and economic structures are in place. Where does each rank in terms of economic freedom, taxation, regulation, transparency, and so on?
Then, how are those respective systems working for the poor and middle class?
Unfortunately, assignments like these are not being assigned on most college campuses. That’s why we are seeing the romantic embrace of Sanders and his Democratic Socialism despite empirical evidence and many examples now and in the past that those policies backfire on those they’re supposed to help—the poor and the powerless.
Fortunately, Why Nations Fail has summarized the results of 20th century experiments in varying brands of socialism and offers great examples conservatives should have handy during the election season and beyond—now more than ever.
Sanders, who has served in the U.S. Senate as an independent and describes himself as a Democratic Socialist, was actively involved with and endorsed communist members of the Socialist Workers Party over Democratic candidates during the Cold War, despite those candidates having no chance of success.
In the years since, his brand of socialism has gained currency, especially among America’s youth.
In February, a panel of Marquette University students praised socialism on UpFront on WISN-TV. They said the Sanders’ brand of “Democratic Socialism” they’re attracted to is focused on helping people, as opposed to their perception of other forms of socialism.
The chairman of the Marquette University College Democrats said he appreciated hearing Bernie Sanders “champion using the powers of the state and do these things that seemed radical at the time,” like Medicare for All and imposing a $15 per hour minimum wage. “To me, what Democratic Socialism means is bringing the United States into the standard of living that honestly every other industrialized nation in the world experiences right now,” he said.
However, evidence suggests that socialist policies, even the ones implemented with good intentions, backfire on those they’re supposed to help.
That brings me to this month’s RightWisconsin book of the month. In 2012, Daron Acemoglu and James Robinson published Why Nations Fail: The Origins of Power, Prosperity, and Poverty. By making complex economic arguments easy to understand, the authors describe how far-left policies have ruined nations.
At the expense of connecting with the common man, economics has become overly quantitative and difficult to follow. But this book is one of the clear exceptions. The authors simply make the world their laboratory, asking why portions of our globe have so much wealth and much less poverty than other parts of the world.
The obvious variables from one nation to the next can be attributed to culture, weather, and geography. So the authors strip that all away and focus on parts of the world where these variables are largely the same and where there is generally only one big difference: public policy.
The areas examined by the authors include Korea (North versus South), Nogales (U.S. Side versus Mexico side), Berlin (East versus West) and several other examples. The results are clear—the big difference in a nation’s wealth is attributable to democracy, free markets, transparent systems, and an accountable government.
Communism and Bernie’s far-left Democratic Socialist ideas have proven to create less wealth and more poverty. It’s not just wealth, though. It’s also health. South Koreans, who have the same genetic makeup as their North Korean counterparts, are 2-3 inches taller due to the scarcity of nutritious food in the Communist North.
Why Nations Fail was initially published in 2012, and ample new evidence has accumulated to reinforce Acemoglu and Robinson’s claims since then. One is Venezuela, which was the wealthiest country in South America not long ago. The New York Times describes its collapse as one of the worst implosions of a country outside of wartime in decades. It is now among the poorest countries in South America as a result of Sanders-like policies of highly centralized government, lavish social welfare programs, and forced wealth distribution to fund them.
We can also look around our own country. States that have been embracing more limited government policies are experiencing better economic opportunities for those climbing the economic ladder. For example, Vermont ranks #46 for overall freedom in the Cato Institute’s “Freedom in the 50 States” index, while its neighbor New Hampshire ranks #2. Consequently, New Hampshire’s economic strength ranks #13 but Vermont ranks #29, according to U.S. News.
Meanwhile, Illinois (#35 on the Cato index), New York (#50), and California (#48) have lost a net 3.2 million people over the past decade to other states as people flee to places with lower taxes and more opportunity such as Florida (#1), according to a Bloomberg analysis.
If I was teaching economics at a university today, I would assign the following: Choose a place with similar cultures, weather, people, and geography but two different forms of government. Then identify what political and economic structures are in place. Where does each rank in terms of economic freedom, taxation, regulation, transparency, and so on?
Then, how are those respective systems working for the poor and middle class?
Unfortunately, assignments like these are not being assigned on most college campuses. That’s why we are seeing the romantic embrace of Sanders and his Democratic Socialism despite empirical evidence and many examples now and in the past that those policies backfire on those they’re supposed to help—the poor and the powerless.
Fortunately, Why Nations Fail has summarized the results of 20th century experiments in varying brands of socialism and offers great examples conservatives should have handy during the election season and beyond—now more than ever.
A sturdy thesis on the effect of key political institutions on economic growth and societal stability. Difficult beginning section, but then it becomes a much easier read. Really enjoyed it.
informative
medium-paced
De thesis van Acemoğlu en Robinson is bijzonder kort samen te vatten: waar institutioneel rijkdom uit het land / de mensen gezogen wordt en in handen van een kleine elite belandt, is er geen zekerheid, is er weinig of geen incentive voor innovatie of voor mensen om zichzelf te verbeteren, en falen naties. Waar instituties ervoor zorgen dat eigendomsrechten gerespecteerd worden, mensen gelijke kansen krijgen, en mensen beloond worden als ze risico’s nemen en investeren in nieuwe technologieën en vaardigheden, wordt rijkdom verdeeld onder de mensen, en bloeien naties.
Ze noemen het een extractive versus inclusive instellingen. In een extractive situatie is de kleine elite bang voor veranderingen en willen ze het status quo behouden en zeker creative desctruction vermijden. In een inclusive situatie is er ruimte voor een positieve feedback loop van innovatie en groei.
Ik vond twee voorbeelden het meest sprekend.
De commenda in Venetië was een formule waarbij een “sedentaire” partner al (of het grootste deel van) het geld in een onderneming zoals maritieme handel stak, terwijl de andere “reizende” partner het lijfelijke risico liep. De opbrengst van de onderneming werd zo verdeeld dat de reizende partner een veel groter deel van de opbrengst kreeg dan wat hij er geldelijk in stak. Op die manier konden mensen met weinig naam en faam zeer snel opklimmen in de maatschappij. De auteurs stellen dat het einde van dit systeem en meer specifiek de Serrata in 1297, het moment dat Venetië besliste dat lidmaatschap van de Grote Raad enkel nog erfelijk zou zijn, ervoor zorgde dat er Venetië sindsdien alleen maar minder groot is geworden: geen incentive meer om zichzelf te verbeteren, en een omslag weg van relatieve grote inclusiviteit. Gevolg:
De commenda in Venetië was een formule waarbij een “sedentaire” partner al (of het grootste deel van) het geld in een onderneming zoals maritieme handel stak, terwijl de andere “reizende” partner het lijfelijke risico liep. De opbrengst van de onderneming werd zo verdeeld dat de reizende partner een veel groter deel van de opbrengst kreeg dan wat hij er geldelijk in stak. Op die manier konden mensen met weinig naam en faam zeer snel opklimmen in de maatschappij. De auteurs stellen dat het einde van dit systeem en meer specifiek de Serrata in 1297, het moment dat Venetië besliste dat lidmaatschap van de Grote Raad enkel nog erfelijk zou zijn, ervoor zorgde dat er Venetië sindsdien alleen maar minder groot is geworden: geen incentive meer om zichzelf te verbeteren, en een omslag weg van relatieve grote inclusiviteit. Gevolg:
Today the only economy Venice has, apart from a bit of fishing, is tourism. Instead of pioneering trade routes and economic institutions, Venetians make pizza and ice cream and blow colored glass for hordes of foreigners. The tourists come to see the pre-Serrata wonders of Venice, such as the Doge’s Palace and the lions of St. Mark’s Cathedral, which were looted from Byzantium when Venice ruled the Mediterranean. Venice went from economic powerhouse to museum.
Van het tweede voorbeeld, in de andere zin, had ik nog nooit gehoord, en ik ben content dat ik er nu wat meer over weet. Omdat de regio van het huidige Botswana leeg van bevolking en weinig economisch waardevol leek, heeft het slavernij en kolonisatie grotendeels vermeden. Bij de onafhankelijkheid hadden ze 100 mensen die middelbare school hadden gedaan en zes die verder gestudeerd hadden in het hele land. Maar de mensen die aan de macht kwamen hebben zichzelf niet gewoon in de plaats van de kolonisator dictator gemaakt, maar hun best gedaan om te zorgen voor degelijke instellingen en infrastructuur. Wat er nu voor zorgt dat zij zowat de meest stabiele democratie van heel Afrika zijn, en dat de diamanten die er gevonden werden niet voor burgeroorlog zorgden maar decennialang voor één van de hoogste economische groeipercentages ter wereld.
⁂
Interessante dingen geleerd dus, zeker dat. Maar bij nader inzien is de thesis misschien net iets te banaal om er vele honderden pagina’s voorbeeld na voorbeeld na voorbeeld aan te hangen. Om de centrale gedachte voor te stellen en te ondersteunen, was een middelgroot essay ook voldoende geweest. Het boek springt bovendien zó vaak van de hak op de tak, waarbij de tak meestal de Engeland en dan vooral de Glorious Revolution is, dat het soms om van te duizelen is. Het voelt ook vaak aan alsof de auteurs gewoon weetjes willen geven, niet omdat zecentraal zijn aan de thesis of nodig om ze te onderbouwen, maar omdat ze ze nu eenmaal opgezocht hebben en het wel interessant is om te vermelden.
Engeland, Frankrijk, Egypte, Botswana, Japan, Brazilië, Mexico, Peru, Colombia, de Azteken en de Maya, Cortés en Pizarro, Jamestown en Roanoke, de dertien kolonies van de VS, Spanje en de Cortes en de Consitutie van Cádiz, patenten in de 17de eeuw in Engeland en in de 19de in de VS, Porfirio Diáz in 1880, Pinochet in de jaren 1970 en -80, het verschil tussen Bill Gates en Carlos Slim — en dan zit ik nog maar een paar tiental bladijden ver en heb ik een hele hoop discursussen overgeslagen.
Serieus: het boek springt van continent naar continent en van eeuw naar eeuw in zo ongeveer elke paragraaf. Niet dat ik er een groot probleem mee heb, maar het lijkt soms wat onnodig. En het maakt er niet echt een coherent verhaal verhaal van.
⁂
Er is weinig in te brengen tegen het centrale idee. Het vervelende, en de auteurs geven dat grid toe, is dat het weinig voorspellende waarde heeft: voor elk van de naties waar het slecht of goed gaat, had het ook goed of slecht kunnen gaan. Nadat ongeveer de helft van de bevolking stierf aan de pest in de middeleeuwen, had de adel in Oost-Europa net een tikkeltje meer macht dan in West-Europa, waardoor ze daar hun privileges niet alleen behielden maar zelfs verstevigden. Omdat de Koning in Engeland op dat moment net wat minder macht had dan in Frankrijk, kon hij geen monopolie op transatlantische handel afdwingen, waardoor handelaars rijk en machtig werden — terwijl dat in Frankrijk niet op die manier gebeurde, en in Spanje al helemaal niet. Maar voor hetzelfde geld was het anders gegaan.
Terwijl ik het boek las, en vooral naar het einde toe waar we iéts meer in het heden komen, begon het me wat tegen te steken. Er zitten gaten in het verhaal. Is neo-liberaal kapitalisme écht de enige weg naar een geslaagde natie? Wat is een natie, eigenlijk? Wat is de rigoereuze definitie van “extractive” en “inclusive”? Is er echt niet één tegenvoorbeeld te geven? Wat met nationalisme en met religie en ander niet-rationeel fanatisme? Letterlijk één pagina over media op het einde van het boek is al wat we te horen krijgen over de rol van informatie in dit alles — wat met de Verlichting en politieke en andere wetenschappers in het verleden, en televisie en internet en sociale media in het heden? En akkoord, Jared Diamond heeft zéker de wijsheid niet in pacht, maar is het écht zo dat geografie en klimaat en toegang tot pakweg de zee en natuurlijke rijkdom niéts te maken heeft met de dingen? Was er wel een industriële revolutie geweest zonder kolen en staal, om zo maar iets te zeggen?
I couldn't retain any of the Information anyway
informative
slow-paced
This book presents many fairly well-accepted and often banal ideas as a radical theory of global economic disparity. The overarching theory they lay out, illustrated by an exhausting series of historical examples, is meant to explain why some nations fail and others do not. The theory hinges on two things: 1) the concept of inclusive and extractive political and economic institutions, and 2) how historical events interact to make institutions either more inclusive or more extractive. This book is very much in the vein of Niall Ferguson - but with much less devotion to the superiority of the West - so if you like his work you will either enjoy this or get frustrated because you think they are ripping him off.
Often the authors simply attach new terms to old ideas. This is a fairly standard tactic in academia, so I don't really have an issue with that. Their terms are ripe with metaphors, conjuring up images of evolution (institutional drift) and crossroads (critical junctures, which are really just turning points). But the two terms that I had the most issues with were inclusive and extractive institutions.
I particularly take issue with their selection of the term "inclusive". They define these as "those that allow and encourage participation by the great mass of people in economic activities that make best use of their talents and skills and that enable individuals to make the choices they wish" (p. 74). They emphasise in particular the role of these institutions in allowing for innovation and creative destruction, and enforcing property rights. That's all well and good, but I think "inclusive" conjures up an image of something very different than what we see in the US and many other Western nations today. Pluralistic? Fine. Democratic? Yeah, pretty much. But to argue that there is 'a level playing field' (as they do) is to ignore the massive disparity within even successful, wealthy nations. Other than discussing prior disparity between north and south, they essentially ignore the many ways in which economic and political institutions are not inclusive in their own country. I realise that their theory is meant to explain global disparity, not national, but the book repeatedly raised questions for me about the degree to which institutions really have to be inclusive to succeed. They constantly talk about the 'contingent nature of history', but I would have really liked an exploration of the contingent nature of "inclusive" institutions.
This book has a lot of fascinating historical information, but I found it exhausting to read. They aren't especially good story tellers, and I often felt as though I was trying to read an entire history book in one go. I think this is a feature of trying to tackle so much and provide a very large body of evidence to support their theory. In many cases, most of the details are superfluous and they could have supported their ideas with much less text. I know that this is the culmination of several decades of research for the authors, and I commend their ability to translate so many small details into a very small number of parallels. But that's just it: this is a 450 page book that make a relatively small number of points. I would have enjoyed this book much more if they had managed to make those same points without cataloguing so much detail.
Often the authors simply attach new terms to old ideas. This is a fairly standard tactic in academia, so I don't really have an issue with that. Their terms are ripe with metaphors, conjuring up images of evolution (institutional drift) and crossroads (critical junctures, which are really just turning points). But the two terms that I had the most issues with were inclusive and extractive institutions.
I particularly take issue with their selection of the term "inclusive". They define these as "those that allow and encourage participation by the great mass of people in economic activities that make best use of their talents and skills and that enable individuals to make the choices they wish" (p. 74). They emphasise in particular the role of these institutions in allowing for innovation and creative destruction, and enforcing property rights. That's all well and good, but I think "inclusive" conjures up an image of something very different than what we see in the US and many other Western nations today. Pluralistic? Fine. Democratic? Yeah, pretty much. But to argue that there is 'a level playing field' (as they do) is to ignore the massive disparity within even successful, wealthy nations. Other than discussing prior disparity between north and south, they essentially ignore the many ways in which economic and political institutions are not inclusive in their own country. I realise that their theory is meant to explain global disparity, not national, but the book repeatedly raised questions for me about the degree to which institutions really have to be inclusive to succeed. They constantly talk about the 'contingent nature of history', but I would have really liked an exploration of the contingent nature of "inclusive" institutions.
This book has a lot of fascinating historical information, but I found it exhausting to read. They aren't especially good story tellers, and I often felt as though I was trying to read an entire history book in one go. I think this is a feature of trying to tackle so much and provide a very large body of evidence to support their theory. In many cases, most of the details are superfluous and they could have supported their ideas with much less text. I know that this is the culmination of several decades of research for the authors, and I commend their ability to translate so many small details into a very small number of parallels. But that's just it: this is a 450 page book that make a relatively small number of points. I would have enjoyed this book much more if they had managed to make those same points without cataloguing so much detail.
informative
reflective
slow-paced
medium-paced