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

3.94 of 5 stars 3.94  ·  rating details  ·  7,399 ratings  ·  760 reviews
Brilliant and engagingly written, Why Nations Fail answers the question that has stumped the experts for centuries: Why are some nations rich and others poor, divided by wealth and poverty, health and sickness, food and famine?

Is it culture, the weather, geography? Perhaps ignorance of what the right policies are?

Simply, no. None of these factors is either definitive or
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Hardcover, 544 pages
Published March 20th 2012 by Crown Business (first published 2012)
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Community Reviews

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Randal Samstag
The book Why Nations Fail by Daron Acemoglu and James A. Robinson comes with book-jacket praise from the usual suspects: Steven Levitt of Freakonomics fame, Jared Diamond of Collapse fame, Nobel Prize “laureate” George Akerlof, and Niall Ferguson, champion of imperialism. Thomas Freidman dashed off a quick review in his New York Times column for April 1, 2012. Freidman, the giddy fan of globalization, was ecstatic, although he admitted that he was “reading” the book, but not that he had “read” i ...more
Yalman Onaran
This could be written in one chapter or a long magazine piece. Has an interesting theory, but it just goes on for too long and not worth spending the time.
Hadrian
Their main thesis is very interesting - that there is a strong link between political/social institutions and the economic success or failure of a nation.

Compare Botswana, which has achieved remarkable growth despite the AIDS epidemic, and Zimbabwe. Compare South Korea, which was poor, and is now a regional power, to North Korea, where the huddled skeletal masses pluck corn kernels from feces to survive while the Kim clan gorged on cognac.

The main reason states are successful, say Acemoglu and R
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Siew-Lee
Such an insightful and shocking book! The examples are very well-explained, and I truly enjoyed thinking and discussing the points raised in this book. Only if more people would read this book and understand that it is not for the lack of aid to poor countries, but the very political and economical structure of the country that makes it poor.

The whole inclusive and extractive political-economical standpoint is very interesting.

The only nitpick I would comment on: the book suffers from excessiv
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David
This is an excellent book about the reasons why some nations are prosperous, while others are steeped in poverty. The authors contend that some nations have "inclusive" economic and political policies. These policies give a political voice to a large segment of the population, rather than only to a small elite. As a result, a set of checks and balances tends toward a positive feedback, sometimes called a "virtuous cycle". This virtuous cycle helps to accelerate the tendencies toward inclusivenes ...more
Keith Swenson
Overall: very very interesting and very important topic. I would give it 5 stars except it is very long, detailed, and not an easy read. However well worth it.

Thesis in brief: some countries are properous, and others are not. What causes the difference? Some are right next to each other and the difference in prosperity can not be explained by geography, climate, or even culture. Instead it is the system, and what is it about the system that explains the difference. They elaborate a theory that t
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Daan
The hypothesis is clear very early on; what follows is an evidence-loaded journey that keeps hammering the intriguing and simple message home: that extractive, exclusive institutions wreck a country while profiting the elite who holds the power to change the institutions ; and inclusive institutions provide a country with economical growth, while on the long run providing mechanisms through which inclusive institutions are kept.

As many other reviewers have noted, they are however simplistic in p
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Breakingviews
By Pierre Briançon

The book begins in Nogales, a city divided by a fence along the border of Arizona and Mexico, and ends 450 pages later in China, with the story of a young entrepreneur arrested in 2004 for having started a large steel plant competing with the state-owned companies. In between “Why Nations Fail” is a highly readable narrative of a breathtaking trip: from the Neolithic Revolution to 16th century England, from Spain’s Philip II to Stalin, from the Mayan city-states to the Portugue
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Jeff Kelleher
A ragged and somewhat bloated masterpiece.

The core theme here is not new: sustained prosperity arises where there is pluralistic government under the rule of law. To the extent a society approaches this structure, which the authors call "inclusive," it develops inclusive--ie, open-- economic institutions, where no elite can obstruct progress. This is contrasted with "extractive" economies, stultified by political elites who repress the "creative destruction" that drives growth but threatens thei
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Miki
I found this book very interesting. I found the book very satisfying in ways that "Guns, Germs and Steel" was not; countries are not poor because of initial resource conditions or ignorance on how to become more prosperous. More often, those in power create political and economic structures to secure power while sacrificing the long-term welfare of the rest of the nation, crippling a country's ability to adapt to changing conditions or use labor and resources efficiently. The book stresses the i ...more
Max
I think the premise of this book is fantastic, and the first 50 pages were terrific. Beyond that, I was pretty disappointed by the execution.

The book is built upon the theory that it is not economic policies, but rather "institutions" (such as good governance, social norms and a strong legal system) that play the fundamental role in economic growth and development. I find this to be a compelling theory and I think it is an extremely useful framework from which to view economic and political dev
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Alex
I could have given this book 4-stars, but I felt 3 were more appropriate in the end. I really think this book's title is a misnomer: it should be "How Nations Fail." I agree the extractive/inclusive dichotomy of political institutions is a useful and explanatory model of a country's economic success and failure. I think it explains much of how a nation/political organization fails. I also like how they point out that failure can take time, and things may look good for a time before they start go ...more
Steven Peterson
This book explores why some nations fail and others do not. The authors lay out their thesis early on (Pages 3-4): "Countries such as Great Britain and the United States became rich because their citizens overthrew the elites who controlled power and created a society where political rights were much more broadly distributed, where the government was accountable and responsive to citizens, and where the great mass of people could take advantage of economic opportunities."

In the process of addres
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Joni
"Why Nations Fail" is an engaging political, historical and economic analysis of civilization's development. Although the book becomes a tiny bit repetitive in stating and restating it's thesis at times, it breaks the trend by including great short bits of developmental process throughout history.

I especially liked chapter 14 "Breaking the Mold" which illustrated how countries through the entropic and contingent nature of development (here called institutional drift) break the mold and switch fr
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Fred R
To Acemoglu and Robinson, the economic prosperity of a nation is a direct function of its political institutions, which in turn are dependent only on historical contingencies. "Extractive" political structures create an economy only to benefit the small ruling class (and therefore are extremely hostile to the wealth-creation of creative destruction, which can only harm the interests of this ruling class. "Inclusive" political institutions, on the other hand, create incentives for large-scale pro ...more
Darren Hawkins
The book is written for a general audience, and if you're feeling smart and ambitious, it is well worth reading. It aims to be the "Guns, Germs, and Steel" of the social sciences. The thesis in "Guns, Germs, and Steel" is that Geography/Climate is Destiny. Civilization arose and thrived where geography and climate endowed people with the most nutritious and easily cultivatable food. Those locations created dynamic human societies that gave rise to complex socio-political institutions, sophistica ...more
Yazeed
This was a great and entertaining read.

The basic argument that the authors present is that the success, or failure, of a nation depends solely on the nature of its political and economic institutions, or lack of any. The argument is very compelling, and the authors spend much of the book explaining how the this theory explains the rise and fall of many nations, from the Roman empire, to the industrial revolution, and the rise of England as a global military and economic power before WWI. They a
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Bill Leach
Actually, I didn't really like WNF. I believe there is real value in the concept of extractive institutions, but the book did a poor job of presenting it. In general, they spent too much time on historical illustrations (probably 80% of the book). It is very hard to extract their conclusions which are hidden away among the historical examples. Also, I felt they spent too much time branding this as extractive and that as inclusive without detailing why it is so.

Any good theory should be predictiv
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Emily
Look, I'm just going to give this a full-frontal, five star review, even though in my heart of hearts I'm a tiny bit worried that there might be a bit of confirmation bias going on here. Yes, there were some omissions (I don't think Scandinavia was mentioned much) but overall, I dug the fact the authors had three or four drums that they BEAT INTO THE GROUND without ever getting tedious. International developmental agencies--hi there! Take a look at this! Understand that you can't engineer a succ ...more
Juan Hidalgo
Me ha llevado casi todo el mes de abril acabar este interesante ensayo económico y divulgativo, pero sin duda ha merecido la pena.

A partir de numerosos datos históricos y jugosas anécdotas los autores nos explican la diferencia entre "Instituciones extractivas" (élites dirigentes que exprimen los recursos de países enteros en su propio beneficio, manipulando para ello leyes y organismos a su antojo), frente a "Instituciones inclusivas" (que favorecen la participación amplia de la sociedad y de i
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Heidi
The central idea of the book is that states fail because of their political institutions, namely because of their extractive nature. This thesis is extremely simplistic.
Economic processes are never this one-dimensional. The authors argue that the three theories of poverty (nations are poor because of their unfortunate geographic location, their culture does not facilitate growth and the West simply does not know how to transform poor countries into rich ones) are completely irrelevant which I di
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Richard
Apr 02, 2012 Richard marked it as to-read
Recommended to Richard by: The Interwubs
Shelves: economics, nonfiction
Your cutting-edge jargon lesson for the day is "extractive institutions" versus "inclusive institutions" .

This, from another book that looks like a must-read. Are they coming out more frequently these days?

Tidbits about it from around the web...

The authors have an extensive website at whynationsfail.com, including a bibliographic essay. You may not think so, but to me that's incredibly cool. I love trolling through annotated bibliographies, and the few and far between ones that actually discu
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Jason
A monumental economic history that touches on everything from the transformation from neolithic times, the divergence of world economies in the last five centuries, and the recent economic history. At times polemical, it effectively and convincingly presents the theory that institutions (specifically inclusive political and economic institutions) are necessary and sufficient for growth. And it effectively rebuts what it sets out as the three alternative hypotheses about the determinants of growt ...more
Ryan
Acemoglu and Robinson’s central thesis isn’t hard to understand: countries with inclusive, equitable political and economic institutions tend to prosper, while those with extractive, exclusive institutions geared towards the interests of a small elite tend to languish. The authors minimize geography and culture as significant factors in the equation, pointing to nations where those realities are similar but political systems vary.

The dynamic exists, the authors maintain, because the interests of
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Susan Larson
Nov 03, 2012 Susan Larson rated it 4 of 5 stars
Recommends it for: history buffs, republicans
Recommended to Susan by: NPR
This book states an important thesis: that nations prosper when economic and political power are shared (Australia, Britain, France), and when government is centralized. They call these nations "inclusive." Nations fail when the political and economic power rests with a few alites (Congo, Russia, Latin America), or where there is no central authority at all (Somalia, Afghanistan). They call these nations "extractive."

Unfortunately, they state things over and over again. These very smart people (
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port22
Critical Junctures

The British Industrial Revolution is the most dramatic event, to which we trace back factors determining prosperity of contemporary nations. The way nations responded to new wave of technologies determined whether they would languish in poverty or set on the path of sustained economic growth. In that, the determining element is the state and development of pluralistic political institutions.

By 1688 English political institutions had a significant component of pluralism. But if
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John Gurney
A thought-provoking look at Why Nations Fail. The authors debunk some theories, such as the geography meme that tropical environments are not compatible with economic development. They point to modern hot weather examples like Singapore and the historic experience, e.g., of the Incas and Aztecs in the Americas vis-a-vis their Stone Age technology neighbors to the north and south.

After working through the options, the authors turn to inclusive institutions as being the difference, the reason a No
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Muhammad Arrabi
A must read book for all people in 3rd world countries.
This book is one of the few that really changed the way I think about History and Democracy.

I listened to the epilogue around 6 times!

I wish it's translated to Arabic. I also wish they release an abridged version for audiobook :-)
Margaret Sankey
Are people in developing countries stupid, or lazy, or do the tropics just instill lassitude? In my experience, drinking palm liquor with Nigerian pirates with English lit degrees, when you live with extractive industries that carry money away and are unable to gain any kind of traction (property rights, jobs in the infrastructure, small scale banking), being a bandit or pirate or political rebel to conserve something for your immediate family is actually the smart move, and one most of us would ...more
Aaron Arnold
Maybe I'm weird, but to me it's a compliment to describe a book as reading like a well-written college textbook. Of course, this isn't a normal book - being yet another burden on the already-groaning shelves in the Why the First World Is Awesome sub-sub-genre of Big History, it's an attempt to deal with issues of development and democracy familiar to political science undergrads, and hence would fit in well on a syllabus - yet it is quite readable, if somewhat repetitious. The basic idea is stra ...more
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Daron Acemoglu is the Elizabeth and James Killian Professor of Economics at the Massachusetts Institute of Technology. In 2005 he won the prestigious John Bates Clark medal, awarded to the best economist under 40.
More about Daron Acemoğlu...
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“Economic institutions shape economic incentives: the incentives to become educated, to save and invest, to innovate and adopt new technologies, and so on. It is the political process that determines what economic institutions people live under, and it is the political institutions that determine how this process works.” 7 likes
“Inclusive economic and political institutions do not emerge by themselves. They are often the outcome of significant conflict between elites resisting economic growth and political change and those wishing to limit the economic and political power of existing elites.” 3 likes
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