Three economists, Daron Acemoglu, Simon Johnson, and James Robinson, were awarded the Nobel Prize for their research on how institutions influence economic prosperity. Their work explains why some countries thrive while others struggle, emphasising the role of “inclusive institutions” that uphold the rule of law and property rights.

These institutions foster long-term growth, while “extractive institutions”, which benefit elites at the expense of the wider population, hinder progress. Their findings highlight how institutions shaped by colonisation laid the foundation for varying economic outcomes.

In their 2012 book Why Nations Fail, Acemoglu and Robinson argue that institutional strength, not factors like climate or geography, determines prosperity. Their more recent work, Power and Progress, critiques how technological advancements have largely benefited elites. The economists suggest that while democracy supports growth, it’s not a guaranteed solution for economic success. They also address China’s unexpected sustained growth despite lacking inclusive institutions.

Read More: https://edition.cnn.com/2024/10/14/business/nobel-prize-economics-acemoglu-johnson-robinson