May 01, 12
Read from April 23 to May 01, 2012
4.5 stars. The central thesis of the book that the differences in economic performance are due to the different nature of country's institutions is believable and illustrated by numerous historical examples. I found inspiring the explanation of temporary growth spurts under "extracting" institutions and why it can't be sustainable. Also, it made me rethink somewhat my view on economic/political reform from inside in some countries (I became less optimistic). I also found interesting the variety historical examples. Still, the narrative was sometimes, as if there were only inclusive or extracting institutions and little in between. Even more importantly, the authors ommitted almost completely the cross-border economic influences of some countries on others. For example, in Europe, the authors look deeply just at English and French revolutions and leave largely unnoticed later institutional convergence first in Western Europe and later in Eastern Europe. As I see it, growing prosperity gap (among others) increased pressures from inside and brought previously extractive regimes down with a delay or caused them to reform to become more inclusive. Also, foreign developments were an inspiration for serial revolutions in 1989 Eastern Europe or more recently, Arab Spring. The authors largely ignore these positive impacts of prosperity and institutions to one's neighbours. Nevertheless, overall, I found the book interesting and inspiring.