Reddit Reddit reviews Why Nations Fail: The Origins of Power, Prosperity, and Poverty

We found 70 Reddit comments about Why Nations Fail: The Origins of Power, Prosperity, and Poverty. Here are the top ones, ranked by their Reddit score.

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Why Nations Fail: The Origins of Power, Prosperity, and Poverty
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70 Reddit comments about Why Nations Fail: The Origins of Power, Prosperity, and Poverty:

u/[deleted] · 17 pointsr/neoliberal

Why Nations Fail seems to be the consensus book to read from this sub. I think it's a great book as well, pretty entertaining with lots of historical examples and history in why some nations fail.

u/disuberence · 16 pointsr/neoliberal

I think you will be surprised to learn that what you have come to understand about neoliberalism and the positions supported by this sub are not always in alignment.

Make sure to read Why Nations Fail. Your first book report is due in two weeks.

u/fresheneesz · 13 pointsr/Bitcoin

China's authoritarian directives have absolutely pushed it far ahead of the squalor its previous authoritarian regimes had perpetuated. Its really flabbergasting to me how people point to this as a positive for china-style authoritarian regimes. Even more stupid is the people that try to say China has a new form of government. They don't. Its basically a dictatorship.

Countries with authoritarian regimes can certainly have massive growth between huge valleys of economic stagnation or collapse. You should read Why Nations Fail by Acemoglu and Robinson. They have a very clear and well supported theory on the effects of government institutions that explains china, russia, the US, and all the rest:

And lastly, democracy vs non-democracy is not a binary thing. Russia, for example, has a "democracy" but very little real representation of its people. India has a similar problem to a far lesser degree. And so does the US for that matter. Democracy is new and something we still have to improve on. But the economic effects a democracy has, of causing sustained but slow growth, are far better than the massive economic swings and generally far lower economic prosperity of authoritarian countries.

u/weirds3xstuff · 12 pointsr/changemyview

There are two books that I have read that have done a great deal to help me understand the dynamics that allowed Europe to rise to dominance starting in the 17th century: Guns, Germs, and Steel, and Why Nations Fail. The former talks about the geographical and ecological considerations that stifled development outside of Europe. The latter talks about the role if extractive institutions, set up by colonial powers, that remained after decolonization and prevented previously-colonized nations from developing. I can't do their arguments justice here, but if you are sincerely interested in changing your view I strongly recommend reading those books. I'll try to address your specific points:

> it seems to me that those of European heritage have made the most long-lasting and significant contributions to mankind. To name a few: space travel, internet, modern technology and medicine.

All of these marvels are founded in the scientific method, which developed during the Enlightenment. The Enlightenment has been successfully exported to multiple non-European countries, most notably Japan. So, it's not just Europeans who are able to appreciate Enlightenment values. But the Enlightenment did start in Europe. So, to believe that the Enlightenment proves that Europeans are superior you must prove that the cause of the enlightenment was the innate character of Europeans, and not any contingent factors. That is...very difficult to do. And, yes, the burden of proof is on you, here, since the null hypothesis is that the biological distinctiveness of Europeans is unrelated to the start of the Enlightenment.

> I realize Arabs of ancient times also contributed a lot in the realms of mathematics and medicine.

Yes. Different civilizations have become world leaders at different points in history, which makes the idea of some kind of innate superiority of one civilization really hard to believe. It just so happens that the Islamic Golden Age occurred at a time when it was impossible to communicate over large distances, while the European Golden Age (which we are now in) occurred at a time when communication is instantaneous and we can project military power across the entire world. In other words, the global dominance of Europeans is historically contingent, not an immutable fact of biology.

>One argument I frequently hear to counter this position is that other nations have failed to develop due to colonization and exploitation.

This is an excellent argument, and is, essentially, correct.

> if they were on the same level as Europeans intellectually and strength wise, why couldn't they have found the means to fight back and turn the tables?

Although they were at the same level as Europeans "intellectually and strength wise", they were not at the same level technologically. Europe was in a golden age, Africa, India, and China were not. Again, the key here is that the European Golden Age occurred at a time when it was possible to travel the oceans and project military power worldwide. That was not the case in the Islamic Golden Age or the Indian Golden Age, which explains why those civilizations didn't conquer the world in the way the Europeans of the 19th century did.

>Instead of Europeans doing what they've done to others, why couldn't it have been the other way around?

Guns, Germs, and Steel does the best job of explaining this. In short: Europeans were blessed with livestock that could be domesticated and a consistent climate that allowed them to produce lots of food more efficiently that other regions of the world could, which allowed them to spend more time on other things, like technology. Again, the full argument is the length of a (very good) book, so I suggest you pick it up to get more details.

u/josiahstevenson · 12 pointsr/badeconomics

You thinking more Poor Economics or Why Nations Fail? There's also some good stuff on urbanization's role in development in Triumph of the City which has a lot of implications for developed-world city policy too.

u/lampenstuhl · 12 pointsr/MapPorn

That's not true. Rural Bohemia was more advanced than rural France in the beginning of the 20th century. Read it in this book, I'll just suppose they got their sources straight.

u/Reg_Monkey · 10 pointsr/badeconomics
u/LegitimateProfession · 8 pointsr/politics

You don't understand economics. If it's too expensive to use Chinese labor to make cheap goods, that means China is already too wealthy and developed to need to rely on low-value manufacturing in its own labor force.

In fact, moving such factories to India, SE Asia or West Africa would mean more money going to China, as Chinese companies invest in the developing economies the same way US companies and individual investors have gotten wealthy from Chinese development, production and consumption.

Other countries will change their laws to whatever China wants. They want to compete to attract all those factory and low-level service jobs that China is seeking to offshore.

Why Nations Fail

Yi Wen's illustrative essay on how China's economy developed so rapidly

u/Fauler_Lentz · 7 pointsr/MapPorn

There are very few examples for countries that managed to build a well working state from nothing within a very short period of time. Most of the nations that are wealthy and not corrupt today went through a development that took them decades, or even centuries: The UK, France, Benelux, German states and Scandinavians all started developing public education and efficient administration in the late 18th or early 19th century, which is one of the reasons they all pretty much exploded in strength during the 19th century, while Italy, Spain, Easter Europe and Turkey stagnated and stayed as corrupt as they've always been. Japan is a rare exception, they joined the club in the late 19th century and went from irrelevant to first rate power in just 30 years, as is Austria, which was the only part of the Austro-Hungarian empire that did fairly well after its demise.

It's not a coincidence that Germany, Austria and Japan fared so well after the second world war. They lost everything of material value, but they didn't lose the people that are most valuable to a modern nation: Diligent officials, teachers, professors and industrialists.

Meanwhile Italy was - and is - still corrupt and unstable as always. The destruction the war brought with it did not help them become something better, on the contrary: one of the major benefactors of the downfall of the fascist regime was organized crime.

If you're interested in reading about what helped the nations that are well of today become that way, and why nations that were historically poor have such a hard time achieving the same, I highly recommend the book "why nations fail"

u/smb89 · 7 pointsr/explainlikeimfive

This has been a big subject of academic debate. But the most popular theory among economists (but not necessarily other social sciences) is that it had a lot to do with the kinds of governments that colonists set up; which in turn had a lot to do with native geography and, in particular, disease environments. I did some of my postgrad on this.

In short - if your initial settlers survived, you set up a colony your people could go live in, and you set up government and institutions based on yours back home. They weren't democracies as we know them know, but they had property rights and rule of law.

If your initial settlers didn't, you extracted what you could from the people and the land and stayed as remote from them as you could. The government and institutions you set up were then effectively corrupt and exploitative to begin with.

The theory goes that institutions like that don't change quickly (revolutions can change them, but not always for the better), so countries that started at a disadvantage with the colonisation ended up at a disadvantage.

The most common example is the British Empire in ie Canada or NZ versus sub Saharan Africa.

If you're interested in further reading this was the original seminal research even if it does get a bit technical in parts ( There's also a related book by he same principal author which is more recent (

u/raoulbrancaccio · 6 pointsr/Gamingcirclejerk

>This has nothing to do with socialism or capitalism. Capitalist states often have the same social programs, but they have well made economic policy that can generate the wealth to sustain it without forcing everyone into poverty (see Denmark, Canada, Australia, etc)

No, it has to do with socialism and capitalism, it is not capitalism that generates that wealth, resources and labour generate wealth. If it was capitalism, then why are Somalia and Liberia so poor, their capitalist wealth generating magic should protect them, shouldn't it? They are being exploited out of their resources, so they cannot generate wealth, also, Cuba is just as poor as these countries, but it fares much better, I wonder why.

It is convenient to only talk about Europe, North America and Australia when you have to defend capitalism.

And Australia doesn't even have that big of a welfare state tbh.

>Venezuela was only doing "fine" because they were filthy rich from oil.

Yes, so?

>Compare them to singapore which didn't have said luxury of ridiculous wealth under their land.

Singapore? Have you ever heard reports of people actually working there? It's rich because their workers are controlled and alienated by the state, again, you are reinforcing my point (which is Keynes point, which is everyone with a brain's point), it is not capitalism that creates wealth, but it is labour and capital.

>Imperialism is entirely separate from capitalism (mercantilist nations relied on it the most)

I am not only referring to classical imperialism, but especially to economic imperialism, which includes the exploitation of resources and of cheap labour from other countries.

>are you really fucking implying USSR / PRC didn't kill innocents what the fuck.

When did I imply it? Just saying that capitalism kills mostly innocents, also, numbers are definitely inflated, the 60 million figure for Stalin is a meme by itself, and it is literally backed up by nothing.

>Read a book

>Exploitation tends to harm the imperialist nations, and nations become wealthiest by providing the means to success to all their citizens. It just so happens that private property and free enterprise does this the best.

I love it when people tell me to read a book, when they do it's probably the only book they've ever read, and they usually feel so triumphant when they have actual literature backing up their claims, no matter the context, also, it is always by some American economist.

Anyways, I do love me some Acemoglu (studied him pretty intensely in university, and I am rather fascinated by his theory of institutions being a fundamental driver in a nation's development, with the whole inclusive v. extractive discourse), but data is against the fact that exploitation harms imperialists, it might harm the nations that imperialist companies are located into (I would need data for this though), but it does not harm said imperialist companies, and how much cheap labour and resources are exploited in both Asia and Africa should tell you figures about it. You are confusing trading with exploiting, it's the former that gives theoretical gains to the poorest nation in some macroeconomic models.

Also, if you'd like, Read a Paper, even for a capitalist right wing economist such as Allen the centralised functions of the USSR are finely designed to bring about economic growth (and the USSR was the fastest growing nation for 50 years), so your "most efficient" meme which originates with the neoclassical school is just empirically wrong, and what I already said about Cuba (thanks to the embargo it's just as poor as some African countries, but it fares much better) further cements it, and I'm saying this without even supporting the Stalin-driven USSR (guilty of following aggregate results more than worker benefit, like capitalists do).

And, alas

>Marxism is a meme. That's why it will never be taken seriously by people outside of New School or UMass (besides internet memers and autocrats), sorry son.

I don't want to be racist, but this is the final showing that you are an American kid stuck in your own all-American Neoliberal bubble; Marxism is taken seriously (very seriously) everywhere except for the country that has a strong propaganda against communism, a right wing skewed government where the """"left"""" is composed of liberals and a government and education system which are quite literally controlled by big corporations, I wonder why.

And fun fact, in the rest of the world your economics literature (not all of it of course, some of it is good, mostly from the salt lake schools) is what is being made fun of.

And since we're talking about the US, lolefficiency, more than 5 times more vacant homes than homeless people, truly a fair and efficient allocation of resources, wouldn't you think?

u/lawrencekhoo · 6 pointsr/AskEconomics

In general, Peterson is not reliable. He tends to cherry pick, selectively omit, or outright distort, the 'facts' he cites. For the case of the Pareto Principle, which is often stated as "20% of the population will own 80% of the wealth", this is only true for certain parameters of the Pareto distribution. In reality, human societies are diverse; some societies have a high concentration of wealth and income, while other societies have much lower concentrations. As you correctly surmised, much has to do with the institutions that exist in the society. As Acemoglu and Robinson argue, when the elite control the government, they set up institutions that enriches the elite while dispossessing the majority of the people. A strong government that strives to restrain the exploitative tendencies of the elites will enable the majority of the people to reap the economic benefits of their work and will lead to faster economic growth and a more equal society.

u/espressoself · 6 pointsr/badeconomics

I mean, it is this sub's favorite meme

Quoted from his EconTalk segment: (link here)

>There's a very interesting thesis that Jared Diamond's Guns, Germs, and Steel sort of formulated, which is that really the geographic factors determined where early civilizations blossomed, and that, almost in a deterministic way, shaped which societies are more developed today. And we go in detail about why we sort of disagree with the thesis and why it's not really capable of explaining the patterns of what we see around us today; but they are interesting sort of variants of this. But the one that I think is more kind of popular among journalists and academics is a sort of cultural hypothesis. Max Weber was the person who developed the most famous example of this, or the Protestant ethic and constructive process; and Catholics. That's not as popular perhaps today. But if you sort of ask people why China is doing so well: Well, it is about Chinese culture. Why the Mexicans aren't doing so well or why sub-Saharan Africa is poor: It's all about national cultures or some cultural traits shared by a variety of individuals; or it would be Muslim versus non-Muslim. And again, we try to explain why such explanations are very limited. China has had the same Chinese culture but it did extremely badly under Mao... they did extremely badly 40 years ago when they had terrible incentives under Mao, and suddenly started doing well when the incentives changed. And all the while the same people in Hong Kong were doing very well. That should tell you something.

u/econlurk · 5 pointsr/badeconomics

>a book is the thing you do when you can't get a theory past the peer-review process.

u/the_popcorn_pisser · 5 pointsr/Drama

I'm not going to touch this one because it's already been there for a day but as a Central American let me clear something up:

The shit that happened in North America doesn't even compare to the level of attrocities that happened in the rest of America. It is even argued that the reason why the US and Canada are wealthy and Latin America is a shithole goes to how different both regions were conquered. Up north Europeans were eventually forced to actually trade, down here they literally raped and pillaged and those power structures remain today (

u/WhereCanILearnR · 5 pointsr/badeconomics
u/Cragsicles · 4 pointsr/AskSocialScience

I'm glad you've become interested in such a fascinating topic. However, it's pretty expansive, so here are some links to books and topics in terms of broad, global, and more specific studies related to the issue of income equality:

Broad Topic/Global:

u/Schutzwall · 4 pointsr/neoliberal

It's wholesome to spend Valentines Day with my crush

u/emi_online · 3 pointsr/neoliberal

>Do you think there's no middle ground between foreigners showing up with guns and ships and taking your shit, and being separated from world trade?

Yes, I believe trade and foreign investment is that middle ground.

>Despite being grotesquely unequal (as all countries were at the time), India was once enormously wealthy. I cannot help but think that if its wealth had remained in India or been traded for other forms of wealth, rather than just being taken, India might be doing a bit better today.

Read this book it's a great book about the topic at hand.

u/rebelrob0t · 3 pointsr/REDDITORSINRECOVERY

I went to one AA meeting when I first got clean and never went back. I understand people have found support and success in it but to me, personally, I felt it only increased the stigma of drug addicts as these broken hopeless people barely hanging on by a thread. It's an outdated system that relies on little science or attempting to progress the participants and relies more on holding people in place and focusing on the past. Instead I just worked towards becoming a normal person. Here are some of the resources I used:

r/Fitness - Getting Started: Exercise is probably the #1 thing that will aid you in recovering. It can help your brain learn to produce normal quantities of dopamine again as well as improve your heath, mood, well being and confidence.

Meetup: You can use this site to find people in your area with similar interests. I found a hiking group and a D&D group on here which I still regularly join.

Craigslist: Same as above - look for groups, activities, volunteer work, whatever.


This will be the other major player in your recovery. Understanding your diet will allow you to improve your health,mood, energy, and help recover whatever damage the drugs may have done to your body.

How Not To Die Cookbook

Life Changing Foods

The Plant Paradox

Power Foods For The Brain

Mental Health

Understand whats going on inside your head and how to deal with it is also an important step to not only recovery but enjoying life as a whole.

Feeling Good: The New Mood Therapy

The Emotional Life Of Your Brain

Furiously Happy

The Science of Enlightenment: How Meditation Works


If you are like me you probably felt like a dumbass when you first got clean. I think retraining your brain on learning, relearning things you may have forgot after long term drug use, and just learning new things in general will all help you in recovery. Knowledge is power and the more you learn the more confident in yourself and future learning tasks you become.

Illegal Drugs: A Complete Guide to their History, Chemistry, Use, and Abuse

Why Nations Fails

Ideas: A History of Thought and Invention, from Fire to Freud

The Modern Mind: An Intellectual History of the 20th Century

Thinking, Fast and Slow

The Financial Peace Planner: A Step-by-Step Guide to Restoring Your Family's Financial Health

Continued Education / Skills Development

EdX: Take tons of free college courses.

Udemy: Tons of onine courses ranging from writing to marketing to design, all kinds of stuff.

Cybrary: Teach yourself everything from IT to Network Security skills

Khan Academy: Refresh on pretty much anything from highschool/early college.

There are many more resources available these are just ones I myself have used over the past couple years of fixing my life. Remember you don't have to let your past be a monkey on your back throughout the future. There are plenty of resources available now-a-days to take matters into your own hands.

*Disclaimer: I am not here to argue about anyone's personal feelings on AA**

u/Soundofawesome · 3 pointsr/Documentaries

Uh... why so aggressive? All most all of these countries, were colonies of western countries for literally hundreds of years.

Most of them, after gaining their independence, under went decades of civil wars. Or were grounds for proxy wars of more developed nations fighting over their natural resources (diamonds, uranium, etc.) and differing political ideological (capitalism vs communism).

Since they were colonies, they typically had restrictions placed in their ability to form legal systems, or they formed some distorted version of a western legal system. These weren't British citizens, with established legal frameworks, rebelling from Britain (like the American Revolution).

The lack of a legal system made it more difficult to form stable governments, or even organize functional economic systems. Typically their citizen lacked basic legal protections, that more developed nations take for granted.

Literally, nothing like a drug addiction, but yea good on them for try.

Maybe read this book. :/

u/si_sports · 3 pointsr/politics

Should it be 'available' sure! Should the America tax dollars pay for it? No. The America tax dollars should be spend on Americans.

This global village bs doesn't work. We have been giving them money for the last 60 years and much of the world is still a shithole.

You should read "Why nations fail"

u/Semphy · 3 pointsr/neoliberal

Why Nations Fail by Acemoglu and Robinson.

u/NikoUY · 3 pointsr/uruguay

Gracias, pensaba leer la parte histórica primero que es lo que más me llamo la atención de la wiki y si me interesaba algo en particular de ahí entonces leer algo más concreto.

Capaz también algo que explique varios modelos sin ser muy denso, algo que este en el tono de la explicación que pusiste acá pero más profundizado, el de Adam Smith parece interesante pero es medio viejo (1776) y capaz es medio denso, hay alguna cosa más moderna?

Este sería el último que recomendaste, ese autor?

u/SwissMod · 3 pointsr/neoliberal

>Is social democracy neoliberal


>liberal government institutions

  • democracy
  • pluralism
  • rule of law


    this book goes into more detail what exactly thoes institutions are and why they're a good thing. If you read it you're probably gonna be more informed than 75% of this sub so I highly recommend you to read it.
u/SnapshillBot · 3 pointsr/badeconomics


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u/TriStag · 2 pointsr/news


Educate yourself

Educate yourself

Educate yourself

Educate yourself

lmao, this is literally how you argued.

u/Shekellarios · 2 pointsr/de

> An dieser Stelle will ich mal gesagt haben, dass ich nicht glaube das die Menschen der Fehler sind. Das System ist krankhaft.

Ich denke, das ist eine sehr oberflächliche Betrachtung. Denn System und Menschen sind zu eng verflochten, als dass man sie irgendwie trennen könnte; das beste System wird nicht funktionieren, wenn die Menschen, die es bedienen, nicht mitmachen. Es gibt genügend Systeme auf diesem Planeten, die zwar schick aussehen, aber in der Realität einfach nicht funktionieren - durch Korruption und Vetternwirtschaft zum Beispiel. Sieh dir zum Beispiel mal die Demokratie in Südkorea an: unter dem Deckmantel der Demokratie regiert dort eine Oligarchie mit Propagandapresse, die fröhlich den Vater der Präsidentin glorifiziert - auch bekannt als Diktator Park Chung-Hee.

Ein System allein kann die Gesellschaft nicht verbessern. Dazu kann ich wärmstens das Buch Why Nations Fail empfehlen, dass anhand vieler historischer Beispiele die Mechanismen des Erfolgs und Misserfolgs von Gesellschaften analysiert. Sehr lesenswert, allein schon wegen der vielen interessanten Phasen der Geschichte abseits der breitgetretenen Pfade, die durchgegangen werden.

u/someguytwo · 2 pointsr/Romania

Iar referendumuri inutile. Iar discutii despre orice altceva decat ce conteaza cu adevarat, Justitia.

Daca nu ma credeti ca legile care ne guverneaza si cum sunt ele aplicate sunt mai importante decat orice homosexual, ungur sau preot va recomand sa cititi: Why Nations Fail: The Origins of Power, Prosperity, and Poverty

u/News_Bot · 2 pointsr/CapitalismVSocialism

Pareto distribution is a descriptive law, not prescriptive. It does not say that things ought to be one particular way, only that -- all other things being equal -- it will tend to be that way. Pareto had merely observed the well-known phenomenon of income inequality, and later speculated that in a truly free-market society, the most biologically superior citizens—namely the most intelligent—would migrate to the top end of the distribution. Mussolini claimed that as a younger man, he attended Pareto’s lectures at the University of Lausanne. He was struck by Pareto’s ideas, which he later thought may offer a "respectable" academic basis for fascist economics.

As Pareto’s biographer Franz Borkenau stated, “In the first years of his rule Mussolini literally executed the policy prescribed by Pareto” in matters of economic reform, “largely replacing state management by private enterprise, diminishing taxes on property, [and] favoring industrial development.” Pareto’s estimation of early fascist accomplishments entered the historical record: as he wrote in a letter to a junior colleague, “The victory of Italian fascism confirms splendidly the predictions of my sociology and articles.” When Mussolini took power in October 1922, Pareto was less than a year from death, but accepted an appointment to the Geneva Disarmament Conference that Mussolini had offered him.

If a society had a historical % rate of malaria, we would not use this as an excuse not to cure or treat malaria. If a society had a historical % probability for women to experience rape, we would not use this an excuse not to criminalize rape. You can try to apply it, but that doesn't mean it actually applies. You still need evidence.

In other words, almost every effort of human civilization is there to remedy some "natural state of affairs" that would occur if we didn't do anything at all, but in no other case do we take that as a recommendation that this is what we ought to strive for. Yet this is how some naive "classical" liberals interpret it. They paint Pareto distribution as some sort of justification for unlimited wealth concentration by elites, when in fact it shows that wealth concentration, while normal in prosperous societies, beyond certain levels; is characteristic of highly corrupt societies and late stage imperialism.

Whether the Pareto distribution correctly describes a set of phenomena is unimportant. Climate observations predict that Phoenix, AZ is not a particularly pleasant place in the summer. Yet, there is air conditioning and swimming pools. Observation of the anatomy of humans proves without a shadow of a doubt that we are incapable of flight. Yet, there are airplanes. Evidence suggests that in the past, small disagreements often escalated to conflicts in which one of the disagreeing parties was left dead or seriously injured. Today there are laws that not only lay out what is and is not allowed, but the range of punishments when people fail to abide by the laws.

Some classical liberals, and lost boys who've adopted Jordan Peterson as their new daddy, will have us believe that because Pareto distribution has been observed to apply to a variety of phenomena, that means it's inevitable and we should stop trying to decrease inequality, which is just as ridiculous as me suggesting we should just stop fighting gravity and confine ourselves to ground transportation. Social inequality exists in most societies, but the degree to which it exists varies wildly from society to society, and it is not at all a foregone conclusion that massive inequality need be the default social condition. In reality, human societies are diverse; some societies have a high concentration of wealth and income, while other societies have much lower concentrations.

The Pareto principle, often stated as "20% of the population will own 80% of the wealth", is only true for certain parameters of the Pareto distribution. Much has to do with the institutions that exist in the society. As Acemoglu and Robinson argue, when the elite control the government, they set up institutions that enrich the elite while dispossessing the majority of people. Rutherford Hayes and Einstein observed this also.

Thomas Piketty's discussion of Pareto from his book Capital in the 21st Century is good. It's a very unsettling book, but it's unsettling because it uses a wealth of data to challenge optimistic assumptions about the trajectory of inequality:

>It is worth pausing a moment to discuss some methodological and historical issues concerning the statistical measurement of inequality. In Chapter 7, I discussed the Italian statistician Corrado Gini and his famous coefficient. Although the Gini coefficient was intended to sum up inequality in a single number, it actually gives a simplistic, overly optimistic, and difficult-to-interpret picture of what is really going on. A more interesting case is that of Gini’s compatriot Vilfredo Pareto, whose major works, including a discussion of the famous “Pareto law,” were published between 1890 and 1910. In the interwar years, the Italian Fascists adopted Pareto as one of their own and promoted his theory of elites. Although they were no doubt seeking to capitalize on his prestige, it is nevertheless true that Pareto, shortly before his death in 1923, hailed Mussolini’s accession to power. Of course the Fascists would naturally have been attracted to Pareto’s theory of stable inequality and the pointlessness of trying to change it.
>What is more striking when one reads Pareto’s work with the benefit of hindsight is that he clearly had no evidence to support his theory of stability. Pareto was writing in 1900 or thereabouts. He used available tax tables from 1880–1890, based on data from Prussia and Saxony as well as several Swiss and Italian cities. The information was scanty and covered a decade at most. What is more, it showed a slight trend toward higher inequality, which Pareto intentionally sought to hide. In any case, it is clear that such data provide no basis whatsoever for any conclusion about the long-term behavior of inequality around the world.
>Pareto’s judgment was clearly influenced by his political prejudices: he was above all wary of socialists and what he took to be their redistributive illusions. In this respect he was hardly different from any number of contemporary colleagues, such as the French economist Pierre Leroy-Beaulieu, whom he admired. Pareto’s case is interesting because it illustrates the powerful illusion of eternal stability, to which the uncritical use of mathematics in the social sciences sometimes leads. Seeking to find out how rapidly the number of taxpayers decreases as one climbs higher in the income hierarchy, Pareto discovered that the rate of decrease could be approximated by a mathematical law that subsequently became known as “Pareto’s law” or, alternatively, as an instance of a general class of functions known as “power laws." Indeed, this family of functions is still used today to study distributions of wealth and income. Note, however, that the power law applies only to the upper tail of these distributions and that the relation is only approximate and locally valid. It can nevertheless be used to model processes due to multiplicative shocks, like those described earlier.
>Note, moreover, that we are speaking not of a single function or curve but of a family of functions: everything depends on the coefficients and parameters that define each individual curve. The data collected in the WTID as well as the data on wealth presented here show that these Pareto coefficients have varied enormously over time. When we say that a distribution of wealth is a Pareto distribution, we have not really said anything at all. It may be a distribution in which the upper decile receives only slightly more than 20 percent of total income (as in Scandinavia in 1970–1980) or one in which the upper decile receives 50 percent (as in the United States in 2000–2010) or one in which the upper decile owns more than 90 percent of total wealth (as in France and Britain in 1900–1910). In each case we are dealing with a Pareto distribution, but the coefficients are quite different. The corresponding social, economic, and political realities are clearly poles apart. Even today, some people imagine, as Pareto did, that the distribution of wealth is rock stable, as if it were somehow a law of nature. In fact, nothing could be further from the truth. When we study inequality in historical perspective, the important thing to explain is not the stability of the distribution but the significant changes that occur from time to time. In the case of the wealth distribution, I have identified a way to explain the very large historical variations that occur (whether described in terms of Pareto coefficients or as shares of the top decile and centile) in terms of the difference r−g between the rate of return on capital and the growth rate of the economy.

u/ptwarhol · 2 pointsr/NoStupidQuestions

Here's your answer in one book. (I just finished the audiobook- it was brilliant.)

u/kwanijml · 2 pointsr/Anarcho_Capitalism

I mostly agree with you, of course. But I'm not always sure how to parse through the issue based on historical data.

>In the last 30 years freedom has increased in the developing world and gains are economic gains increasing in the last 30 years in the west freedom has decreased and gains are slowing.

That's likely more to do with what economists call "convergence" (diminishing returns to capital). Also, what we've seen increase in these developing countries over the last 30 years has not been just freedom (not in the voluntaryist/ancap sense of the word); it's been more a shift of better property rights and more inclusive institutions, which is dominated not by lack of government, but more democratic forms of governance and all the public goods via the state that comes with this; a la Acemoglu and Bueno de Mesquita.

So, in other words, what is the relative magnitude of "freedom" as a factor in producing growth and prosperity, as opposed to the natural march and progression of technology and our evolution from bacteria into 4-dimensional beings of light?

u/classicalecon · 2 pointsr/AskEconomics

If you want something different than recessions, you could look at growth theory and / or development economics. Acemoglu and Robinson have a good pop book on the institutional view.

u/jaredislove · 2 pointsr/AskEconomics

I would recommend Acemoglu and Robinson's book Why Nations Fail on this topic. Expands on the other answers already given.

u/darkaceAUS · 2 pointsr/EnoughTrumpSpam

Everyone? People stealing shit? Everyone? All legally allowable property? What sort of questions are these? Well-defined, regulated and all-encompassing property rights are the single most important feature for inclusive broad-based growth.

The left needs to stop seeing everything as a continuation of the class war. It doesn't exist. The rich aren't out to eat you. And the Republicans can (rightfully) hit you with the 'class envy' smear.

Socialism is a fucking joke. It has no practicality. It will never get the left elected. If you believe in it, take econ classes until you understand the myriad of criticisms anyone who understands scarcity will level at you.

Although I think I'm going to unsub from here. Idiots have overrun another sub. Sad that places I can actually stand to be are always shrinking because socialists are just failures that whine online and think that downvotes and moronic arguments get them anywhere in the real world.

u/morebeansplease · 1 pointr/DebateReligion

> It is allowing people to exercise their free will and liberty. How does denying a service harm another?

Its not just a service, its a public service.

> How does denying a service harm another?

One incident can be declared as the most minimal of harms, just go to the next shop down. Its the systemic denying of service which is the concern. It results in creating Social Classes which the US was designed to reduce or avoid. If you are seriously looking for understanding may I suggest a book; Why Nations Fail

u/kiwifuel · 1 pointr/JordanPeterson

Historically speaking, that is not true. All throughout the Middle Ages all material goods belonged to God and/or the king.

This is well-documented by historians and economists. The combination of formalizing and democratizing property rights is one of the things that economists have linked to the increase in wealth and ingenuity that began during the industrial revolution.

One source: Why Nations Fail by the well-respected economist Acemoglu

u/veringer · 1 pointr/politics

I get where you're coming from, but there are fine examples of the best the West hast to offer too: Germany, Denmark, Netherlands, et al. There are multiple high points in the cultural landscape. Japan may lay claim to one peak, but there are other (perhaps taller) ones out there.

Within America too, there are regions and groups that stack up more favorably on a hypothetical "culture-index". For instance, Minnesota seems to be working better than Mississippi for reasons beyond location and history. If I were to speculate as to why, it'd rely heavily on the theses found within Why Nations Fail. Namely, how inclusive the local economic/political/social strucures are. That's heavily dependent on culture. Thus, my earlier comment was suggesting that the fraction of America that vehemently supports Trump is more than likely identifying with an entirely different culture than the other 60%. And (in my opinion) there's no contest as to which of the two cultures tends to produce better results. Alas, that is a bias as to what factors we value and include in our "culture-index". Those differing priorities are at the heart of our nation's lamentable cultural divide.

I don't think we need to adopt a Japanese culture to improve overall. We're a young and ignorant country... baby steps. Just a nudge toward Minnesota and away from Mississippi would yield significant long term results.

u/Randy_Newman1502 · 1 pointr/AskEconomics

You've stumbled onto a whole subfield of economics: Development Economics.

Here is a list of all NBER papers tagged with development.

This is a good resource regarding the EITC (check the citations).

If you are looking for "lay person friendly" books, I'd recommend:

u/stuffirianz · 1 pointr/portugal

> os EUA?

> Não tinham recursos nem nativos suficientes para explorar?

Não, não tinham. Não existiam grandes civilizações com governos centralizados facilmente reaproveitados no norte. Nao existem minas de ouro na virginia.

Enquanto no sul, os espanhois basicamente reaproveitaram os sistemas existentes para explorar os nativos, no norte, os ingleses tentaram explorar os nativos e nao conseguiran; depois tentaram explorar os colonos e tambem nao conseguiram. No norte, so conseguiram ter sucesso na colonizacao com programas de colonizacao baseados em incentivos que deram aos colonos um nível de autonomia completamente diferente do que os mesmos ingleses deram a toda e qualquer colonia que tenham conseguido explorar.


> E a Austrália e NZ foram colonizadas centenas de anos depois do Brasil e américa do norte, o que também influenciou muito.

200 anos. Assim como tantas outras colónias fundadas depois de 1800. Mas curiosamente, so a NZ e a Australia são países 100% ocidentalizados. Porque será?

u/SpiceAndEvNice · 1 pointr/Drama

En serio te gustaría ver otra Venezuela en Latinoamérica? Vivo en Costa Rica. No es un "leftist paradise" pero tenemos políticas muy cercanas, especialmente con el exceso de gobierno y esa extraña fijación en reducir las emisiones (un país pequeño como este ni siquiera es un generador tan grande de emisiones).

Todas las noticias que reddit pone saying "COSTA RICA HAS BEEN RUNNING ON RENEWABLE FOR X MONTHS" misses the point that we have one of the most expensive energy expenses of the region. It misses the point the our national monopolies are incompetent and end up pushing down on the lower classes because of how expensive it is.

Aquí no hay voluntad política para arreglar problemas fundamentales como la corrupción del CONAVI o la inoperancia de RECOPE. Y todos los gobiernos de esta región son un cancer de corrupción con la misma historia. La diferencia es que en gringolandia el pobre vive considerablemente mejor que el pobre de acá.

Leftist policies have failed time and time again here. If you want to blame American intervention go ahead, but you very well now that isn't the reason why shit fails here. It's a systemic problem that goes back to the Conquest. I suggest you take a look at

No leftism here is going to save anyone until those structural and cultural issues are fixed. Until then, it will cause more chaos and poverty.

Sorry for the rant.

u/Yasea · 1 pointr/Automate

I base my opinion on Capital in the 21th century, Why nations fail and this IMF note and few others that I didn't save the links for.

u/NicCageKillerBees · 1 pointr/neoliberal
u/Saltysacksagain · 1 pointr/southafrica

The Zuma Government is showing exactly the same hallmarks every other African Liberation movement that came into power showed. Unless there is a substantial change in the extractive government institutions and a return to plural democracy, its unlikely the outcome can be averted. One of the only African exceptions is Botswana, an example of good governance and an inclusive economy.

To understand the modus operandi of Zuma type governments, you should read . A real eye opener and explains more or less why the current SA government has little interest in uplifting the South African people...they are not there for the people, they are there for themselves. Its a simple case of ignoring what the say and paying attention to what they do.

u/psychart · 1 pointr/brasil

Eu tou lendo esse livro: e gostando bastante. Ele dá uma visão do porque alguns países prosperaram mais que outros.

u/quantifical · 1 pointr/changemyview

> Haha, we're gonna get in the semantic mire here. My use of the word charity (I thought) kinda implies that 'is giving people direct charitable help the best form of charity'? Is the form of charity that 'charities' enforce the best use for £100 million? And who's to say the charities I pick would be the best. I can't really squeeze that all into a pithy headline. So no! Not yet haha.

Sorry, this just sounds so dishonest. Again, how does this prove that the government are the best? Again, if you don't know what's best, why are you saying they are?

I already gave you a solution if you don't know best that doesn't require the government. Quoting myself, "If you don't know which charities to donate to, why not an index fund of charities of sorts which excludes inefficient charities? For example, charities where, for every $1 donated, less than 80 cents actually goes towards helping people. We can let people vote for causes with their money and back those causes accordingly." Vote with your money or back the market of other people's votes.

> My evidence is that nothing else has done it better to raise living standards.

What evidence do you have that governments raise living standards?

Governments don't raise living standards. Businesses raise living standards. Governments getting out of the way of business helps businesses raise living standards.

Ensuring fair rule of law (no corporatism, no cronyism, etc.) and property rights (the promise that what you earn or have is yours to keep) for all is the only thing government can do to get out of the way of businesses.

Please read this book when you've got time.

> Do many third world countries have efficient democracies and government? To be fair, this is the best critique, because I think the utility of my point is directly relative to the amount of corruption, and rent seeking in the society. So yeah, it does depend.

No, you misunderstand how governments work and form. They (edit: third world country governments) fail to ensure fair rule of law and property rights.

> Except these fish have tried plenty of other gold fish bowls and they're rubbish.

What does this even mean?

u/Nobusuma · 1 pointr/explainlikeimfive

As stated Guns, Germs, and Steel by Jared Diamond. The region played a factor. Focusing on Europe, Europe had easy access of travel due to the Mediterranean sea. In broader view they had the silk road. There is a book called Why Nations Fail. A very interesting read. Out of dozens of examples the book shares, I will point out two that help shape Europe; the first being the story of Hercules and second the Black Death. The story of Hercule enabled a change in thought over the centuries as greek men went to the Olympics trying two win fame and glory for themseleves. The individual. The Black death on the other hand destroyed the working class and enabled a change in the current western system.

u/LoseMoneyAllWeek · 1 pointr/neoliberal

>make them SEZ

Zero federal taxes and zero federal regulations? Cause I’d be okay with this. Mmmhmmm that capital inflow would be so hot.

>redistribute those votes to new immigrants

Lol wow here you need this

>limit the civil rights

Like what exactly?

u/nomnombacon · 1 pointr/worldnews

You are actually very spot on when it comes to the ultra-wealthy staying on top. My whole point is that there have been multiple recessions and financial crises in the US - and many more outside of it. History keeps repeating itself and the only thing "they" learn is how to hide the fraud better.

I would recommend learning about the S&L crisis in the 1980s-1990s ("Savings & Loans"). About a third of the S&L associations in the US failed, partially caused by bad mortgages. Pretty similar to 2008 - and there are other examples of greed taking over common sense.

Waste Management. Worldcom. Enron. Tyco. Freddie Mac. AIG. Lehman. Wells Fargo (most recent - and after 2008). It just keeps happening... almost as if being exposed to that kind of money has a tendency to corrupt some people. Or does the money attract the already corrupted?

"They" will always change and be replaced with fresh blood craving a higher ROI (Return on Investment). That's why the status quo will never change, especially not with continued deregulation.

If you would like to learn more, I will give you my top 3:

  1. The Big Short (book not movie. If you like his style, follow up with Liar's Poker).

  2. [Financial Shenanigans](Financial Shenanigans: How to Detect Accounting Gimmicks & Fraud in Financial Reports, Second Edition is a huge favorite of mine. It gives real life examples of various creative accounting practices - while teaching you about financial statement analysis in the process.

  3. [Why Nations Fail](Why Nations Fail: The Origins of Power, Prosperity, and Poverty is another great illustration of continued failure to learn from mistakes.

    Bonus: if you want to really understand what happened in 2008, read this undergrad thesis of this one Harvard student. It's been praised to be one of the most succinct and comprehensive explanations for the 2008 crisis. And if you read it, keep in mind that the same instruments are being created again (CDOs - Collateralized Debt Obligations).
u/Pilopheces · 1 pointr/AskALiberal
u/thedaveoflife · 1 pointr/Economics

Xi is everything Trump wishes he could be: an autocrat who answers to no one. This is why the US cannot win a trade war with China... Xi pays no political price for tariffs or anything else, where as a 2020 loss looms large for Trump and handcuffs him at the negotiating table. Soy Bean tariffs from China would be a critical political blow to the american heartland that holds (somewhat undemocratic) outsized political power. Xi will effectively be the leader of China for as long as he wants regardless of what happens.

Ironically this short term disadvantage is really a long term advantage for the US. There is a reason that China has to steal American IP and not the other way around. Ultimately our politicians are answerable to us.... the economic prospects of the Average American and the Country as a whole are intricately linked due to our institutions (hat tip Daron Acemoglu)

u/standard_deviation · 1 pointr/worldnews

Not OP but the 6 million victims number is correct. You can check it here or here.

Also most of the Soviet killing took place in times of peace while Hitler killed in wars. So comparing WWII stats is misleading.

Also not well known is the fact that Stalin killed another 1,5 million people in Ukraine right after WWII in 1945/46 through another forced starvation.

u/t3nk3n · 1 pointr/Libertarian

>Property is the coercive exclusion of others from entering certain areas or touching certain objects. That's what it is.

Aside from alll those times when it isn't.

Not enough words to make all the citations: more and more and more and more and more

u/tschuff_tschuff · 1 pointr/explainlikeimfive

If you are interested in such topics, you ought to read Why Nations Fail: The Origins of Power, Prosperity, and Poverty

u/chotchss · 1 pointr/history

Yes, definitely! But at least at the beginning, it seems like the release of these disease was unintentional (versus the plague blankets that came later). From what I read, the initial plague vectors were fishermen off the coast of New England (possibly Brits or Portuguese) and from early Spanish explorers. Further, the original British plan for colonization was similar to that of the Spanish in the south- conquer, put the natives to work, extract resources back to the UK. But that fell apart due to the plunge in native populations and their decentralized governments (compared to South America).

Anyway, I'm not an expert on this subject, this is just what I remember reading in Why Nations Fail (

This guy sums it up:

u/ethyn_bunt · 1 pointr/PoliticalDiscussion

Sorry for the late response, I've been pretty busy all day.


> The problem, I think, is trying to make an issue that's not so black-and-white look black-and-white. In the poll you linked, read the write-in responses below. Most of the comments for the 'agrees' say things like "gains and losses are not spread evenly" or "economists understate short-term employment costs"

True. Trade is not black-and-white, there are winners and losers. There is consensus on that as well -- the losers are those who lose their jobs, and the winners are literally everyone else (not just the uber-rich). If you're interested in reading about trade and how it does and does not affect the economy, I'd suggest this Paul Krugman essay.

However, the consensus is still there. Although some particular trade deals might not be considered favorable to the US (Krugman described himself as a "lukewarm opponent" to the TPP) trade overall is seen as a massively positive benefit to the economy due to comparative advantage. The extremely quick drop in world poverty and rise in living standards can mostly be attributed to trade.

Also, I see you've noticed Acemoglu's comment. You left out

> probably less than benefits

Which makes a huge difference. I highly recommend his book, Why Nations Fail though if you are more interested in his thought process.

> It's worth noting that Sanders is only 'anti-free-trade' in the black and white world, and in reality his stance is that these agreements can be good if there are stipulations like retraining programs, comparative working condition requirements, etc.

Sander's view is about as black-and-white as you can get. He has opposed literally every single trade deal he could, whether or not they had any of those stipulations.

And, I know I've linked Krugman a lot -- I don't think he's infallible but he's one of the very best resources on trade -- here he explains in plain English why "comparative working conditions" may not lead to quite as good an outcome as you'd expect. I agree with you and Bernie that retraining programs are necessary, as would many economists (there's not quite a consensus because that is more a matter of opinion on what is "right") but the fact is that there is and has been a solid consensus in economics on the benefits of free trade, comparable almost to that of global warming for climate scientists.

u/RochelleH · 0 pointsr/TrueReddit

Why Nations Fail is a great, apolitical book that encompasses some of these theories. I'd say Samuel Huntington's 'Clash of Civilisations' is as well, but Reddit doesn't like him and usually end up likening him to Ayn Rand.

u/JeffersonClippership · 0 pointsr/Whatcouldgowrong

If you're asking that kind of question you're too stupid to understand the answer but if you wanna try to understand, read these books

u/sub_surfer · 0 pointsr/worldnews

Economic growth is possible under authoritarian governments, but not sustained growth. That is why the PRC is destined to stagnate. Unfortunately, I don't have time to write a massive comment teaching you about the relationship between inclusive political institutions and economic growth, you'll have to go educate yourself. This book will explain everything if you care to read it. South Korea, Taiwan and PRC are all used as illustrative examples.

u/MKEndress · -25 pointsr/AskSocialScience

Yes. Your answer can be found in the pop book "Why Nations Fail" ( or the academic work of its authors. Short answer is that incentives matter, and markets provide great incentives.

NB: Neoliberal has no meaning in economics and is essentially a pejorative for anyone who does not align perfectly with the far left. We would refer to these policies as market liberalization, where liberal is used in the classical sense.