D. Acemoglu and J. A. Robinson: Why nations fail. The origins of power, prosperity and poverty: Crown Business, New York, 2012, pp. 529

Int Rev Econ (2013) 60:409413

DOI 10.1007/s12232-013-0191-3

BOOK REVIEW

D. Acemoglu and J. A. Robinson: Why nations fail. The origins of power, prosperity and poverty

Crown Business, New York, 2012, pp. 529

Stefano Zamagni

Received: 10 October 2013 / Accepted: 31 October 2013 / Published online: 15 November 2013 Springer-Verlag Berlin Heidelberg 2013

Why nations fail is a beautifully written book, extremely useful both to professional economists and historians, but also to political scientists. It is easy to read that makes this book accessible even to a larger readership. The character of the book is that of an interdisciplinary essay where economic theory is in constant dialog with history, political philosophy and social science at large. The method of argumentation the authors have chosen to defend their thesis is original and very fruitful: history is not just an introduction to the theory or a mere way to test it. (There is no econometrics in the book). It is intertwined with it and an essential component of the narrative. The approach taken to explain why poor countries are poor is to delve into the past and study the historical dynamics of the societies of those countries.

The authors argue that at the heart of world inequality is the circumstance that the countries which have become poor (or have never been capable to progress) are those that have been ruled by narrow elites that organize society for their own benet at the expense of the population at large. After discarding as irrelevant or only partially relevant, the usual explanations based on geography (location, natural resources endowments, and climate); on culture (religious habits, moral values, and social norms of behavior); and on knowledge (human capital, quality of information channels, etc.). Acemoglu and Robinson propose their own theoretical explanation.

It is the institutional economic set-up that is decisive in determining whether a country is poor or prosperous. Economic institutions, i.e., the rules of the economic game, can be either inclusivethose rules that foster economic activity and economic progressor extractivethose rules that are designed to extract income

S. Zamagni (&)

University of Bologna, Bologna, Italy e-mail: [email protected]

S. Zamagni

Johns Hopkins University, Bologna Center, Bologna, Italy

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410 S. Zamagni

and wealth from a large subset of society to...