
Why some nations are rich and others poor (2016) - novaRom
https://panampost.com/jose-azel/2016/09/07/the-real-reason-why-some-nations-are-rich-and-others-poor
======
unoti
Political institutions are part of it, but probably not the most important
part. The excellent book _Guns, Germs, and Steel_ [1] lays out very well
researched reasons for the disparities we see today. Highly recommended
reading!

Spoiler: What kind of crops and livestock you have paired to your climate over
history is a big factor (number of calories you can raise per acre). What kind
of livestock you had or didn't have also relates to what kinds of diseases
might wipe you out (see Aztecs). And what kinds of raw materials you have
available impacts what kind of commerce you can engage in. These factors over
time have a huge impact on how civilizations advanced relative to each other.

There's a summary of the book on Wikipedia[2], along with some interesting
criticisms.

[1] [https://www.amazon.com/Guns-Germs-Steel-Fates-
Societies/dp/0...](https://www.amazon.com/Guns-Germs-Steel-Fates-
Societies/dp/0393354326) [2]
[https://en.wikipedia.org/wiki/Guns,_Germs,_and_Steel](https://en.wikipedia.org/wiki/Guns,_Germs,_and_Steel)

~~~
pedrosbmartins
I agree that _Guns, Germs, and Steel_ is an excellent book, but it does not
explain modern economical disparities. It basically explains why Europeans
were the ones to conquer the African and American continents in the 15th and
16th centuries, and not the other way around (and the arguments are solid).
But it clearly does not explain why modern countries have large economical
disparities today, or why some countries colonized by Europeans are highly
developed economically (e.g. the US, Australia) while others are not (e.g.
Brazil, South Africa).

As for the article, I believe there is more to economical success than
political institutions as well, it is such a complex process that it cannot be
reduced to any single factor.

~~~
onyva
The biggest power in the world at this time was the Ottoman Empire, and they
controlled all land access to their markets, and had no urgent need to explore
further than the outreach of their empire, unlike the Europeans, who were
struggling to get access to India and China. Even though the Ottomans did
poses a naval fleet, there was no real economical incentive. Ie. the Suez
canal was a very old idea that the Ottomans considered but did not carry
through etc.

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seesawtron
Is "inclusive political and economic institutions" always a good strategy? I
am not convinced and the article doesn't point to any solid evidence to
support this claim rather portrays a representative picture.

Does "rich nations" imply nations where the elite hold huge amount of capital
or does it refer to nations where an average citizen lives in prosperity? The
article doesn't reflect on the comarison of ecomomic divide in the nations.

The article's claim that "exclusive" institutions concentrate power in the
hands of the few elite and hence the nations end up being poor. THe US could
be considered a rich nation with "inclusive" institutions and yet there exists
the concentration of power and wealth to the few. These correlations argument
of very shaky.

The Adam Curtis documentaries [0,1] at their core point out the loss of
control by the democratic government (elected to serve its people) to the
private economic institutions (created to serve the elite).

[0] [https://youtu.be/fh2cDKyFdyU](https://youtu.be/fh2cDKyFdyU) [1]
[https://youtu.be/v-npoz1SgRQ](https://youtu.be/v-npoz1SgRQ)

------
CapitalistCartr
The United States inherited a great deal of political history from Britain
that gave us a huge boost. As Newton said, "If I see so far, it's because I
stand on the shoulders of giants." We Americans got that advantage. And
Britain didn't come by it easily: from the Norman invasion to the American
rebellion were 11 civil wars. Representative governance instead of
dictatorship was hard-fought. We like to think we alone fought for our system,
but that's drastically untrue.

~~~
ww520
France, too. Lots of the democratic ideas are from France. E.g. The Social
Contract by Rousseau.

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frodetb
> Plainly put, poor countries are poor because those that have power make
> choices that create poverty.

Simple enough, almost sounds tautological. If truly all the causes listed in
the beginning of the article don't amount to an explanation, then there's
little left to point at than the governing powers.

I'd like some more proof before I'm convinced that inclusivity in government
is _the_ smoking gun, but I don't think it is controversial to say "democracy
good."

------
dirtyid
In a globalized world influenced by a US hyperpower for 60+ years, countries,
especially small ones, are allowed to thrive with the beneficence or
indifference of powerful countries. Taiwan, S.Korea, Japan all become rich and
industrialized via protectionist authoritarians governments supported by US
interests and protection umbrella. Opposite for US sanction countries. A lot
of EU would not have recovered into wealthy countries postwar without similar
US support.

Much of the geographic constraints stopped mattering when a unipolar country
controls all trade routes and dictates winners and losers. Of course competent
local governance determines whether beneficence could translate into long term
wealth, and a host of cultural factors determine if interests with benefactors
can align long enough for such wealth production systems to emerge, but
whether that wealth equitably distributed is another question.

------
pmoriarty
The US, already well on its way up in the 20th Century, was spared during WW1
and WW2, while many other countries were devastated.

It also had massive resources, nearly endless open land compared to Europe,
oceans on two sides to guard it from any credible threats, and a lack of
invaders or civil wars in the 20th Century.

The US also used to be a lot more welcoming, and benefited from many talented
immigrants, Einstein being perhaps the most well known.

------
nine_zeros
At least in the case of India, colonization ensured that the local population
was decimated in terms of access to education and industrial revolution for
nearly 200 years.

After colonization ended, while they inherited British institutions, arbitrary
boundaries (which affect them even today) and a closed economy (coming from
protectionism and fear of western colonizers) ensured that they couldn't rise
from the ashes as fast as other Asian countries.

------
ars
"Poor countries are poor because they are ruled by narrow elites that organize
society for their own benefit at the expense of the citizenry."

Seems to me he got cause and effect backwards.

The same thing that causes countries to be poor also make them "easy picking"
for elites who want to exploit them.

~~~
jsperson
This is why I am skeptical about the long term threat/success of China. With
Xi now effectively chairman for life he will put more energy into maintaining
his position than governing.

~~~
mc32
Unfortunately for the governed there is a lot left to drain out of their
reservoir. Take Venezuela for example. It’s been going on 20 years too long
but it keeps going.

~~~
jsperson
On the flip side - it also means that if we have a bad president or two in the
United States, we’ll still probably be ok. With multiple branches of
government there’s only so much damage that can be done in 4/8 years.

~~~
karmakaze
I used to think that. Then this term happened. Or I still do but severely
underestimated "only so much damage".

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asdfman123
> The tools of extractive economic institutions include abolition or severe
> limits on private property, state-run enterprises, excessive regulation and
> taxation, and more.

> Acemoglu and Robinson acknowledge that, under some conditions, growth can
> occur under extractive political institutions as in the case of China.

So I suppose that's not a very good definition of "extractive political
institutions," then, is it? Perhaps wealth extraction can even occur in
countries that claim to be for free market capitalism.

~~~
AnimalMuppet
First, "extractive" isn't a binary, it's a continuum. All economies are
extractive to some degree - everybody's got taxes. But some are considerably
more extractive than others.

Second, China. China's economy was very extractive under Mao. (If you don't
like the term "extractive", call it "state dominated" instead.) Under Deng,
they became less so, and the economy prospered. If there's enough latent
potential in the economy, you don't have to go all the way to "100% non-
extractive" to tap it. Just _less_ extractive will get you some of the gains.

Now, I grant you that the _results_ are not a good definition of "extractive".
But "abolition or severe limits on private property, state-run enterprises,
excessive regulation and taxation" are in fact a reasonably good definition.

~~~
asdfman123
I'm just anticipating the ideological implications there: once again
conflating reasonable goventment solutions with radical socialism.

Obviously authoritarianism is bad, especially when it does not care for
economic realities, but does that really mean anything for western
democracies?

~~~
AnimalMuppet
It means: Don't become authoritarian. Don't ignore economic realities. That
applies to both the government, and (since it's a democracy) to the people.

------
amriksohata
Some nations will always be poor, if nations are rich it means their imports
are lower than their exports, which means other countries have be the
opposite. The whole system is rigged in that way to give the illusion all
countries can get richer but in reality even though they can get richer e.g
American then China etc, it is like a game of whackamole where another country
will suffer somewhere else.

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bjt2n3904
This... article seems to use the phrase "inclusive political and economic
institutions" a lot.

To the point where it doesn't mean anything.

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ardit33
"Te running of the country by few elites that eventually become
corrupt/extractive". Is one of the reasons... but not THE reason. Otherwise
Singapore should be poor, but they are not.

often, it can be explained with the inability of a government to govern, and
individuals are left to their own devices....

Favelas are a demonstration of it (lack of proper housing policy and urban
organization by the government). Also a lot of the chaos of post Communist
Europe....

You can have the greatest laws in the book, but if you can't effectively
enforce them, or govern, then it doesn't matter. Corrupt elites just
accelerate poverty, but they are not the only cause of it.

~~~
dwheeler
I'd love to believe the premise of this article, but this seems easily
falsified by the real world. China has become rich, and is becoming more so,
and it is controlled by a small elite.

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aabeshou
how about the history of imperialism where some countries came in, exploited
the local population and their natural resources, and reaped the benefits of
historical, compounding wealth?

how about the history of how those wealthy countries then turned around and
squashed democratic uprisings in order to install oppressive, right-wing
regimes that were more friendly to their interests?

how about the history of trade sanctions which further cripple countries which
are already disempowered and exploited?

these social darwinist explanations always seem to miss the simple facts of
history

~~~
asdf21
Have you tested this hypothesis? It seems that South Africa is wealthier than
neighbors, for instance.

~~~
aabeshou
South Africa has the single worst inequality in the world [0], and up until
very recently there was apartheid ruled by the descendents of dutch
colonizers. This still fits the pattern of imperialists coming in, and
enriching themselves at the expense of local populations. It's just that in
this case the occupying population hung around permanently. But they're still
hoarding the wealth.

[0] [https://www.cnn.com/2019/05/07/africa/south-africa-
elections...](https://www.cnn.com/2019/05/07/africa/south-africa-elections-
inequality-intl/index.html)

~~~
asdf21
By hording the wealth you mean drastically increasing GDP?

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djaouen
Luck?

~~~
ghaff
While sort of a throwaway comment, you don't really deserve all the downvotes.
Once you get beyond broad historical trends, some of which were geographically
pre-ordained, there's a lot which looks a lot like random confluence of
events.

------
flerchin
At this point it appears to be birth control, and cultural acceptance of birth
control.

~~~
troughway
Are you going to elaborate or just leave it at that?

