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today let's talk about barren awsome ogl
estimate was spent much of his career at m_i_t_
he's one of the leading contemporary development economists and more
generally he's brought the study of political economy back into economics
asa mobily was considered someone who specializes in big picture thinking the
broader historical sweep of economic development and how it ties into
property rights incentives and most of all institutions
at some level it was also had a big impact on labor economics with numerous
significant papers
but we're going to focus on his contributions to economic development
it's important to note that a lot of sa mobile whose work has been with simon
johnson and james a_ robinson both excellent economists who deserve a lot
of recognition to
if there's a core theme in awsome okaloosa work it's that the institutions
matter political economy matters that matters how effective structures of
governance are set up
that was good governance that will be economic growth and economic development
but with bad governance it will boil down to a zero or negative some games
and wealth will be destroyed instead of created
asa mobile it was the economist to today has done more than anyone else to drive
home the relevance of the steams anne does that by mixing history and peer
ical investigation and economic reasoning
a key point for us the mobile it was the distinction between extracted and
inclusive institutions
because extracted institutions as politics designed
simply to take well form one group of people very often the cooler
and to give it to another group of people very often the politically
connected
slavery is an extreme form of an extract of the institution
but you also could consider it very high rates of taxation or mercantilist
regulations and trade barriers designed to prop up say some businesses or
corporations at the expense of the pocketbooks of regular consumers
in contrast inclusive institutions take into account the interests of a large
number of people and their goal is to elevate the general standard of living
in society and they do that usually by producing wealth by making sure that the
rules of the game are fairly enforced and perhaps sometimes supporting forms
of redistribution but redistribution rooted in some idea of the general
welfare anti social safety net rather than just transferring resources the
people who are politically the best connected
one of the summer was best known papers is called reversal of fortune
and it was written with johnson and robinson
it starts with the key point that the wealthy regions in the year fifteen
hundred or very often not so wealthy today
for instance that might include removals and india and the aspects in the end is
in the americans
and fifteen hundred the civilizations and say north america new zealand and
australia or not so wealthy but of course those or extremely wealthy areas
today
so what happened
this paper argues that if they region that was relatively empty in the year
fifteen hundred and that's probably relatively poor
that region was settled by the europeans tended to have they predominance of
european institutions and i've had the kind of european institutions which over
time evolve into being more inclusive perhaps the early settlers of these
regions did say killer drive have a lot of the native inhabitants but the notion
that the native inhabitants were not so populist meant that you couldn't settle
the region by enslaving all of them you need to set up some institutions to
produce wealth
in contrast the more populous regions usually were conquered and then you had
more forms of slavery more forms of wealth extraction and in general
institutions which were more geared tour drooling over people rather than
producing ralph
so when the hypothesis of this paper the great reversal of fortune which starts
around year fifteen hundred is really about economic institutions and it's not
about economic geography
another very well-known paper buyouts um okaloosa bellwether settler mortality
mattered
and this is titled
the colonial origins of comparative development
the key hypothesis here is that in regions where the mortality of colonial
settlers was high they didn't want to set up stakes and build a very
productive economy rather they wanted to come and grab things and put into place
extracted institutions
rather than inclusive institutions
not everyone agrees with the dataset behind this paper but still that has
been a highly influential and well cited result
asa mobile in robinson have a very important and very successful book on
development
called the why nation spell
the origins of power prosperity and poverty
you can think of this book as a very large compendium
of examples and analyses
the importance of this difference between extracted and inclusive
institutions
has some of those work is generally quite excessive bull and there's a lot
of it available on the web in easy to consume forms
for instance the in robinson has been writing a blog
about their book called why nations fail
you can also find the montclair under the handle at why nations fail
again there's the book without some owen robinson
you can put out some okaloosa name into scholar dot google to get through his
best-known papers and also i have some owens work and it's generally influence
ceo earlier video by alex
geography in development institutions