Acemoglu and team have authored a set of influential papers arguing that colonial experience has had a lasting influence on the growth rates of countries well after colonisation through the lasting impact they have had on institutions. Apart from very neat econometric estimations testing of their hypothesis and evaluating them against a variety of alternate thesis, they also draw attention to a host of historical literature on this subject. All this is very impressive. They make a spirited argument that countries with extractive institutions have done poorly in terms of growth. This is where their work starts getting under-defined and […]
Colonisation institutions & development
Economists have done numerous studies trying to relate the institutions of a country to economic growth there. This has been used to argue that institutional quality of a country matters for its growth. Is a country the relevant unit of analysis? Sociologist Immanuel Wallerstein argues that the world should be taken as one system. Interestingly a spate of recent works by mainstream economists begs us to take this approach seriously. Colonial impact on institutional set up A series of recent works in institutional economics have looked at the colonial impact on institutional formation. Based on a dataset of mortality of […]
World systems theory and institutional economics
Many sociologists have argued that caste system in India underwent a fundamental change with the advent of British rule. I did not understand what it meant till I saw colonisation at work in Iraq Concepts like social cohesion and trust have been central to the study of institutions in politics and in economics. It has been argued widely that a society that is more cohesive (or where people tend to trust each other) tends to perform better. This argument has been used in explaining economic growth, political stability, industrial productivity, functioning of markets, among other things. I subscribe to the […]