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

by Daron Acemoğlu

EIGHTEENTH-CENTURY ENGLAND—or more appropriately, Great Britain after the 1707 union of England, Wales, and Scotland—had a simple solution for dealing with criminals: out of sight, out of mind, or at least out of trouble. They transported many to penal colonies in the empire. Before the War of Independence, the convicted criminals, convicts, were primarily sent to the American colonies. After 1783 the independent United States of America was no longer so welcoming to British convicts, and the authorities in Britain had to find another home for them. They first thought about West Africa. But the climate, with endemic diseases such as malaria and yellow fever, against which Europeans had no immunity, was so deadly that the authorities decided it was unacceptable to send even convicts to the “white man’s graveyard.” Their next option was Australia. Its eastern seaboard had been explored by the great seafarer Captain James Cook. On April 29, 1770, Cook landed in a wonderful inlet, which he called Botany Bay in honor of the rich species found there by the naturalists traveling with him. This seemed like an ideal location to British government officials. The climate was temperate, and the place was as far out of sight and mind as could be imagined.

This part is about Australian institutions being created by convicts. They wouldn't have many rights if they were in England since they were convicted of crimes but they were far away from home. They were "free" to create their own new polity. They created a entrepreneurial environment in which inclusive economical and politial instituions coulf flourish. It gives a story of convicts whose personal rights were found legitimate by the Australian jury making them proper citizens with rights.