28 April 2015

Book Review: Why Nations Fail by Daron Acemoglu and James Robinson

Been busy but not doing much that is bloggable. I could write posts about going to the gym but it does not make for very exciting reading. Same with work stuff. Borrrrrrrrrrring.

Read some books though. Let's talk about it!

Why Nations Fail is about inclusive vs. exclusive social and economic policies. It explains (tries to explain?) why nations (such as the USA and Mexico) have had such divergent economic and social histories. 

tl;dr: Exclusive and extractive economic and social policies are self-perpetuating and inefficient. They discourage/disable "creative disruption" (read: innovation), which results in stagnant economic and social development. Inclusive economic and social policies encourage economic and social development.

There is abundant evidence to support their theory, and the authors outline what seems like all of them in book that becomes painfully redundant after the first couple chapters. Unless you are writing your own academic paper you can skip it and just read a summary.

Once you wrap your head around the causes of poverty then it makes sense to consider what your current government is doing about it. Are they encouraging equality, or perpetuating inequality? Are their arguments for doing so legitimate? (No. Not they are not.) One good thing about the innumerable examples in Why Nations Fail is that you can see the pattern throughout history and around the world: Rich, powerful people want to stay rich and powerful. Who wouldn't? It is up to you to decide if that is in your best interest. Unless you are rich and powerful then it probably isn't.

Highly recommended. 

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