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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

4.06  ·  Rating details ·  26,841 ratings  ·  2,615 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
...more
Hardcover, 544 pages
Published March 20th 2012 by Crown Business (first published March 2012)
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Ahmad A small bit at the end but not much.
Jorge It depends, there are middle income economies like Chile or Brazil that have inclusive institutions, maybe you can call them "in transition". But you…moreIt depends, there are middle income economies like Chile or Brazil that have inclusive institutions, maybe you can call them "in transition". But you also have middle income economies like Colombia, that lacks this kind of institutions, so it depends in each case.(less)

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Randal Samstag
Jul 06, 2012 rated it it was ok
Shelves: economics
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 it. ...more
Yalman Onaran
Apr 08, 2012 rated it it was ok
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.
William2
This economic history is, as far as it goes, excellent. The main thesis is ultra simple: nations must develop inclusive economic and political institutions if they are to achieve prosperity. Such political institutions include fair and free elections, an independent judiciary, uncorrupt legislative and executive branches etc etc. Inclusive economic institutions include financial controls such as (in the U.S.) the Fed, the SEC, trust breaking litigation, and so forth. The authors say all of these ...more
Siew
May 18, 2012 rated it it was amazing
Shelves: non-fiction
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
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Heidi
Feb 08, 2014 rated it it was ok
The central idea of the book is that states fail because of their political institutions, namely because of their extractive nature. This thesis is, in my opinion, 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
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David
Mar 31, 2012 rated it it was amazing
Shelves: politics, economics
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 ...more
Keith Swenson
Oct 30, 2013 rated it really liked it
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
...more
Max
Jun 23, 2012 rated it liked it
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
...more
billyskye
May 01, 2017 rated it it was ok
I worked for an international affairs journal when this book was first released. I remember the considerable energy the authors seemed to be putting into its marketing  the articles, the interviews, the debates, the blog, the proliferation of review copies. It seemed like there was a concerted effort to get Why Nations Fail added to that canon of suspect, generalist readings of geopolitics your Clash of Civilizations, your Tragedy of Great Power Politics, your End of History and the Last Man ...more
Ana
A fascinating (albeit difficult to grasp) study on why some nations succeed whilst others fail. The amount of information in this book is astounding, seeing as it is the result of 15 years of research on the topic. This is definitely a book I will re-read, because with a first read you just get the basic argument, but with the second one you get all the subtleties.

I recommend this to anyone with an interest in why our world is the way it is.
Marija
Sep 15, 2017 rated it did not like it
The lack of arguments and statements like: "Unlike in Mexico, in the United States the citizens could keep politicians in check and get rid of ones who would use their offices to enrich themselves or create monopolies for their cronies." (In the 19th century? Really?) or Just as the United States in the nineteenth century was more democratic politically than almost any other nation in the world at the time, it was also more democratic than others when it came to innovation. do not make any ...more
Bradley
Dec 05, 2019 rated it it was amazing
Despite the hutzpah of a title like WHY NATIONS FAIL, there's nothing in the text itself that I found disagreeable, and I've read a lot of different economic and political theories of wealth over the years.

Of course, there have been a lot of armchair historians and armchair economists and armchair politicians, so who knows if 20/20 vision is really accurate? They could all be riffing on one fundamental theory or another and making a messy conclusion. Right?

The beauty of this one is pretty
...more
Daan
Sep 05, 2012 rated it liked it
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
...more
Ray
Jan 02, 2017 rated it liked it  ·  review of another edition
Shelves: non-fiction
A fascinating study as to why some countries are rich and others are poor. It makes a compelling argument that differences in wealth can be explained by the quality of institutions in a country, with successful countries having inclusive pluralistic institutions and poor countries featuring oligopolistic elites and extractive institutions.

Some wonderful case studies across a wide historical spectrum. Spoiled somewhat for me by repetitive style and some bloody awful maps.

3.25/5
Shreya Joshi
Oct 06, 2016 rated it really liked it
Shelves: wise-reads
I had been meaning to read this book for a very long time. The major reason was that I wanted to understand why Nepal is poor and a nearly failing country and why other nations are rich and prospering.
I must tell you that I got the answer in the very first chapters. The whole thesis of this book revolves around "Extractive and Inclusive Political institutions'. The idea is that if a country has an inclusive political institution, the country will have better, sustainable economy and if it
...more
Leo Walsh
Jul 28, 2014 rated it liked it
Daron Acemoglu and James Robinson's Why Nations Fail examines the impact our human-created institutions have on our economies and creation of a "good life" for the many. They do this with a lot of detail. Many of their observations both apparent and useful. Despite this, the book has a number of flaws that seem, to this reviewer at least, critical.

Let's start with the good: the author's central thesis seems sound. Governments and the institutions they create do matter. For instance, consider
...more
Jeff Kelleher
Jan 20, 2013 rated it it was amazing
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
...more
Andrej Karpathy
Sep 16, 2015 rated it really liked it
I read this as part of the Mark Zuckerberg book club :) Why are some nations rich and some poor? Is it geographical? Cultural? This book argues that, to a first order approximation, it is the economic and political institutions that influence this property, based on whether they are inclusive and pluralistic, or extractive, where a small elite rules over the population. The book goes over many examples of countries/regions throughout history, e.g. Maya, Rome, Venice, France/Spain/Britain/New ...more
David Huff
Jun 10, 2018 rated it it was amazing
This book sets forth a thesis, concerning why nations fail, that is both easily understood and compelling. If the length of it looks foreboding, keep in mind that this volume is the culmination of 15 years of research, on a worldwide scale, by two ivy league professors of economics. Happily, though, it's not at all laden with academic jargon, but is clearly written with multitudes of examples.

Their central theme, which stretches back over centuries of history, is that nations evolve into one of
...more
Amir H
Aug 06, 2019 rated it liked it
Shelves: in-english
Why Nations Fail is a well-written book and proposes a hypothesis about the prosperity and poverty of different nations. The authors present the "inclusive" and "exclusive" political and economical systems in the first chapter and the rest of the book is only different examples of these systems.

The repetition of one statement many times in the book is a bit annoying and I think the book could be written in some short articles instead of 500 pages book.
Breakingviews
Nov 27, 2012 rated it liked it
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 Spains Philip II to Stalin, from the Mayan city-states to the Portuguese
...more
Alex
Feb 08, 2013 rated it liked it
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 ...more
Bou
Why is it that there are such huge differences is living standards around the world? Why is it, that certain nations have become rich and will become ever more richer, while other countries time and time again, fail to improve their living standards?

In this book, Daron Acemoğlu proposes a refreshingly simple theory that explains the main contours of economic and political development around the world sine the Neolithic Revolution.

The theory discards some existing (and widely accepted) theories
...more
Darren Hawkins
Jul 15, 2012 rated it really liked it
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, ...more
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 ...more
Camelia Rose
Jan 28, 2020 rated it it was amazing
Shelves: history, audio, sociology
The two authors present in this book a model of inclusive vs extractive economical and political institutions to explain why nations fail and why some nations are richer than others. Here is what I understand of the model:

1. Inclusive economical and political institutions allow larger proportion of population to voice in the economics and politics of the nation. The larger the proportion, the more inclusive the institution, and the more prosperous the country. Inclusive institutions tend to
...more
Bill Leach
Mar 14, 2013 rated it it was ok
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
...more
Fred R
Apr 28, 2012 rated it it was ok
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 ...more
Andy
Jun 09, 2019 rated it it was ok  ·  review of another edition
This is the type of book where they take a word (Extractive) and use it to mean something different from what it usually means and then repeat it 3,000 times and act like that explains things. The authors' overall argument is that nations work better after people revolt against oligarchs, except for all the times when that didn't work.

Better books covering similar ground:

Bad Samaritans The Myth of Free Trade and the Secret History of Capitalism by Ha-Joon Chang , 23 Things They Don't Tell You about Capitalism by Ha-Joon Chang , The Future of Freedom Illiberal Democracy at Home and Abroad by Fareed Zakaria
Syed Fathi
Feb 29, 2016 rated it it was amazing  ·  review of another edition
Shelves: bought, economics
The central thesis of this book is that nation fail economically because of their political institutions. The non-democratic (extractive is used in the book) political institution with power concentrated on one person or group of elite, will produce economic institutions that only beneficial to the ruler on the expense of the public. While the more pluralistic and democratic political model will maneuver the economy to the interest of the public.

This thesis although highly attractive and simple
...more
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Indie Revolution ...: Why nations fail.... or don't 1 4 May 18, 2019 12:17PM  
When is State centralization okay? 5 36 Sep 26, 2018 04:31AM  
Summer 2016 Book Discussion 1 10 Jun 05, 2016 07:20AM  
Bill Gates didn't like the book 9 300 Jun 12, 2015 06:32AM  
anyone else reading this book right now 18 101 Jan 21, 2015 11:29AM  

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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.

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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.” 28 likes
“As we will show, poor countries are poor because those who have power make choices that create poverty.” 26 likes
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