But one thing I'll say about the econ prize is that the way it's talked about in the press is usually somewhat different from why economists laud the winners.
Usually, the winners have made a major methodological contribution which triggered an explosion of follow-on work. Sometimes, this follow-on work will contradict the implications of the original work. So, economists care more about the methodology than the social implications.
However, in the press it's usually about the social implications of the original work, because methodology is boring or too hard to communicate. (This explains why last year's prize winner Chris Sims was reluctant to speak about policy specifics when pressed by an audience member--because he views his contribution as primarily methodological.)
Just wanted to point out that nuance, so that people can understand more the prize, and not put too much weight on the so-called "policy implications" of the prize winners' work.
I wonder if the book mentions the IMF, the world bank and the economic neo-colonialism policies of the West to make sure developing countries stay poor and give away their natural resources. Probably better to read John Perkins or Alex Gladstein to understand how the world works
Sure. The book has more of a focus on domestic institutions, indeed I dont think it mentions the IMF or World Bank more than a couple of times.
It could be a critique of the book that it doesn’t focus on the imposition of economic policies from these organisations enough (it does reference them in a section about engineering prosperity and how these policies have largely failed but it is brief). Certainly the role of these organisations (World Bank et al) and their role in extracting wealth would be valid.
John Perkins (Confession of an Economic Hitman) certainly offers more insight into the neo-colonial practices of these organisations and from the interviews I have heard by Alex Gladstone I would suggest he is well informed on the topic and offers some solutions as well… (I haven’t read ‘Hidden Repression: How the IMF and World Bank Sell Exploitation as Development’.)
I know I read Why Nations Fail, back when I was taking courses in development economics. I don't remember in enough detail to do it justice, but the focus is on social institutions being more important than demography, climate, or geography. Of course, this is what most economists expect: outcomes follow incentives, after all.
The work is useful when refuting political propaganda seeking to pass blame for economic troubles off onto extraneous factors.
The academics have helped show why societies with “poor rule of law and institutions that exploit the population do not generate growth or change for the better,” the Nobel committee said, demonstrating the “importance of societal institutions for a country’s prosperity.”
Yes, totalitarianism, socialism and communism, all backed by force do not do as well as a rules and laws based societies that are backed by individual choices. How many times have we seen that force does not make a very good background for improving conditions? Are we seeing this theory being tested in the real world of the USA right now?
Prize announcement
Interview about the awarded work