WNF Chapter 1

Ladies and gentlemen, I have managed to get around to the first chapter of Why Nations Fail and want to pose a few questions for you to consider.

Their key point is that the difference in living standards between the residents of Nogales, Arizona and Nogales Sonora is due to differences in institutions and how they have evolved over time. The argument is built on a broader story of the differences between the colonisation of South and North America and a tale of two constitutions. The contrasts run through to the differences in the success of Bill Gates and Carlos Slim. In the last section they draw everything together in a theory of world inequality.

Whoever takes this chapter for their presentation should consider teasing out the characteristics of the two sets of institutions. And what were the forces that made them so path dependent?

For some critical thinking, you can consider the following: at the start of the chapter Acemoglu and Robinson make the case that the two Nogales cities are similar in geography, climate, disease environment and residents, but the rest of their story draws on much wider variation in these. There were significant differences in agriculture, mineral resources and population density between the two Americas at the start of colonisation. How important would these be in the cumulative process that followed? Or should one consider this along with the institutions of the colonisers?

Keep up the reading guys.


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