Why Do Nations Fail? by Daron Acemoglu and James A. Robinson

1447 Words3 Pages

Introduction Why do nations fail? This is a topic of popular debate with many economists and a question many scholars have struggled to find an answer to. Global poverty is an issue that economists Daron Acemoglu and James A. Robinson investigate and provide an alternative insight for in their book: ‘Why Nations Fail’. Acemoglu and Robinson investigate inequalities that exist across countries and why nations are an epitome of success and others, failure. They come up with an alternative explanation for why standards of living differ across countries, and why a gap exists between the rich and poor. The book introduces an example of two cities that are separated by a border: Nogales, Arizona and Nogales, Sonora. On the American side of the border, the income of the average household is $30,000, the population is relatively healthy, and the citizens live prosperously (Acemoglu & Robinson, 2012). On the opposite side of the border in Mexico, majority of the population do not own a high school degree, poor health conditions exist, poor infrastructure and unfortunately, high infant mortality rates (Acemoglu & Robinson 2012). How can situations on opposite borders be so different? The basis for Acemoglu and Robison’ s thesis for this phenomenon is that of institutions. They propose that that there is a strong correlation between economic and political institutions. That is, inclusive political institutions support inclusive economic institutions, and extractive political institutions support extractive economic institutions (Acemoglu & Robinson, 2012). Democratic institutions generally allow opportunities for the majority, leading to positive economic growth. Political institutions that look after a narrow elite is reinforced with stag... ... middle of paper ... ...esult, 1000 civilians died, but majority of the fundamentalist group was taken out. In 2009, Goodluck Jonathan assumed presidency when Umaru Yar’Adu died (BBC News Africa, 2013). In 2011 elections, Goodluck Jonathan took majority of the vote against military opponent, Muhammadu Buhari. Observers have stated this election is the most fair it has ever been in history, but Buhari’s supporters opposed the results. Quickly after, the fundamentalist group, Boko Haram, made resurgence and there were daily attacks in the country. As a result, the Nigerian government declared a state of emergency and dispatched troops. In January 2012, Goodluck Jonathan removed the country’s fuel subsidy to repair the tattered economy, but only caused fuel and food prices to rise. In response to the rise of prices, Nigerians began to protest, which eventually led to reinstating the subsidy.

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