Customer Reviews

Why Nations Fail: The Origins of Power, Prosperity, and Poverty

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This study challenges the notion that nation-states and other polities fail mainly because of economic or militaristic blunders. Acemoglu, instead, believes that it is usually the incapacity of a nation-state to move from an extractive mode of governance to a more inclusive one that spells its early demise or eventual failure as a political and cultural expression. By extractive, he means the desire of the leaders to use the country's natural resources for their own gain; in other words a kleptocracy. By contrast, inclusive implies that the wealth resulting from natural resources is shared among the people for the greater good of all, resulting in greater political stability leading to greater economic development. Any nation that goes through an extended period of extraction usually employs limited technology and realizes only marginal economic growth. Consequently, critical political institutions like courts, schools and hospitals rarely exist except for the benefit of the few. From the evidence that the author presents, persistent corruption of due process and the monopolization of resources for the benefit of the few. To make his point, Acemoglu and his colleague present the historical profiles of certain cultures and civilizations that show what happens when pluralism is or is not encouraged. By not including more people in the running of a state like Haiti or Zimbabwe over the past century, its leaders have effectively shut-off any incentive to invest in both business and critical infrastructure. Off-setting these two negative case studies is the little-heard of story of Botswana's success as one of those African frontier states that got it right from the start. Since effective development is a lengthy process, fraught with all kinds of pitfalls, the authors suggest that the culture of political failure, in many countries, is so ingrained that it is almost impossible to reverse unless democratization is allowed to happen in a responsible and gradual way.

The book was written quite well as I found the argument was well supported with plenty of facts and evidence. This book is not filled with any nonsensical jargon
and can be understood by anyone and not just people with poli sci degrees. I recommend this book to be read by anyone that wonders why most African countries are quite poor with
the exception of Botswana. Overall this is a book worth buying.

Review courtesy of www.subtleillumination.com

Acemoglu and Robinson present in Why Nations Fail: The Origins of Power, Prosperity, and Poverty an important idea: that it is institutions that determine whether countries are rich or poor. When institutions concentrate power in the hands of only a few, nations fail. Unfortunately, their book can also be frustrating – their focus on institutions can feel like it blinds them to other possibilities, and as a result their examples, though fascinating, can feel repetitive.

A&R argue that political and economic institutions can be extractive (designed to extract resources and centralize power in an elite who will then oppose change or progress) or inclusive (decentralizing power and allowing individuals economic autonomy). Both types of institutions, they argue, must be inclusive for long run prosperity. It’s an important division, and one that has a lot of explanatory power: anyone who’s crossed the American border with Mexico can’t deny that it is the institutions, not the fifty feet of distance, which matters.

The bulk of the book provides examples. Their studies are both well written and compelling, but they also make me wonder whether institutions are really the distal cause: apart from the simple case of countries with a colonial past, there is little discussion of what leads to good institutions. When they do raise the issue, they seem to implicitly assume that institutions are chosen rationally by elites, based on the cost and benefits of each type, an assumption that seems unconvincing.

Economists and development experts often underrate the importance of institutions, and so Why Nations Fail makes a critical contribution. It also makes a strong argument against the centralization of political power, which can be tempting in the short run but corrupts institutions and social norms in the long run. It’s engagingly written and full of interesting facts, and so is well worth the read for anyone remotely interested in these issues (and everyone should be). It just doesn’t seem to entirely meet its (admittedly ambitious) mandate: to explain why some nations fail and some succeed.

I will encourage all developing world leaders to read this book. I will also encourage universities in the developing world to add this to the list of must read books by Political Science/Humanity students.

Eloquent description of the author's hypothesis of 'why nations fail.' So well written that by the end one is just left saying "obviously, I have always known this."

I see this book is being widely quoted these days and it should. There are good sound explanations for why nations fail and reading between the lines, grave concerns about the ability of our western nations to maintain "democracy" A "must read"

Un livre fascinant sur comment l'histoire des peuples façonne la démocratie. Un livre à lire si on veut mieux comprendre ce qui se passe actuellement dans le monde.

I found this to be an interesting read with a few basic defining concepts:
centralized governance, inclusive vs. extractive economy, pluralism, rule
of law for personal, property and patent rites and constructive destruction.
The examples given help flesh out the ideas, but after a while the book
becomes very repetative. I could be edited down in length be at least one
third and maintained its impact. Still, good counter point to the
writings of Jared Diamond.

“Why Nations Fail” is a history of nations based on the authors’ conceptual framework of inclusive and extractive political and economic systems. Extractive systems are defined by the extractive way in which the resources produced by a nation are distributed sot that an elite group is the beneficiary of that which is produced by the nation. For this reason, the elite will do almost anything to prevent want any changes to the system taking place. Economic growth through industrialization will be discouraged because with industrialization comes urbanization and the formation of wealthy factory owners and an organized work force that will resent the monopolization of power by an elite such as a monarchy or oligarchy. Ironically, dictators and oligarchs are suspicious of granting anyone the kind of power that would possibly threaten their existence and so, the armies in these countries tend to be weak and incapable of maintaining law and order in the nation. The authors argue that nations identified as extractive economic and political systems are doomed to failure because, eventually the citizenry will grow tired of the exploitation and revolt. In the best of circumstance, the exploitive system is replaced with a more inclusive on however, most often, they are replaced by other extractive institutions. The authors would call this the vicious circle. In Africa, dictators like Robert Mugabe, Siaka Steves and Charles Taylor helped overturn their colonial masters in popular revolutions only to use the very institutions that were used to exploit their people for their own purposes. The virtuous circle is a characteristic of inclusive institutions where groups within the nation correct efforts made by another to become more extractive. Franklin D Roosevelt attempted to take away the power of an adversarial supreme court by adding to the number of judges who sit on the bench members who would be agreeable to his policies. Congress wouldn’t let him, which is an example of an inclusive institution making sure it remains inclusive. Inclusive political systems are also characterized by inclusive economic systems where individuals can be assured of their rights to property and ideas. Inclusive political and economic institutions make possible the process of creative destruction that has been the engine of the capitalist economy. It is what has made possible the steam powered loom, the train, the automobile, the computer, and the robot. All these creations resulted in the destruction of a way of life. Those who control agriculture or factories or natural resources production are going to fight against any changes because change will threaten their privileged lifestyle. Unlike, individuals who are part of an inclusive political system, those at the top of an extractive one are not going to care about what is good for the majority of people. They only care about what is good for them even if it results in hardship for millions as we see today in North Korea and Zimbabwe and we’ve seen in the past with the Soviet Union and Communist China. “Why Nations Fail” provides a brilliant new way of looking at nations and why some have prospered while other have failed. Unfortunately, like Marx’s dialectic materialism and his explanation of history, their theories may also suffer from the same danger of circular reasoning. They provide a fantastic new lens to view the world however while open our eyes to some parts, they may also make other parts invisible. The do distance themselves from the social determinism of the great, over-arching theories of the past by stating that the creation of inclusive institutions by the nature is very difficult to achieve because they require the cooperation of many different and competing groups. That said, they do provide a guide that may be incorporated in future attempts to improve the lives of the millions who are presently living within the confines of the failing nation.