Why Nations Fail

Authors argue that some nations are wealthier and more prosperous than others because of their political and economic institutions (e.g. government, market system). Good (inclusive) institutions enable investment and a sense of security in the government and the economic system and so nations prosper, but bad (extractive) institutions do not. Virtuous circles of innovation, expansion and peace are formed from inclusive institutions which form a cycle of increasing prosperity. Prof. Acemoglu and Prof. Robinson argue that exclusionary policies designed to enrich the elites and exploit the poor majority have prevented technological innovation, as the existing elites fought tooth and nail against anything that might endanger their privileges.