Attention Economy


Friday, September 11, 2015

Economic Development – History, Geography, Institutions and Path Dependence

First, a reality check on the role of institutions in economic development -
Cambridge University economist Ha-Joon Chang’s elegant piece (THE REAL LESSON FOR DEVELOPING COUNTRIES FROM THE HISTORY OF THE DEVELOPED WORLD: 'FREEDOM TO CHOOSE') should be a must read for anyone interested in history or economic development
Chang notes –
“Contrary to what is assumed by today's orthodoxy, most of the institutions that are regarded as pre-requisites for economic development emerged after, and not before, a significant degree of economic development in the now-developed countries. 
… in 1913, the US was at a level of economic development similar to that of Mexico today, but its level of institutional sophistication was well behind that which we see in Mexico now. Women were still formally disenfranchised and blacks and other ethnic minorities were de facto disenfranchised in many parts of the country. It had been just over a decade since a federal bankruptcy law was legislated (1898) and it had been barely two decades since the country recognised foreigners' copyrights (1891). A (highly incomplete) central banking system and income tax had literally only just come into being (1913), and the establishment of a meaningful competition law (the Clayton Act) had to wait another year (1914). Also, there was no federal regulation on securities trading or on child labour, with what little state-level legislation that existed in these areas being of low quality and very poorly enforced.”

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A Reading List
Paths of Institutional Development: A View from Economic History by Karla Hoff
Institutions, Factor Endowments, and Paths of Development in the New World by Kenneth L. Sokoloff and Stanley L. Engerman
Why is Africa Poor? by Acemoglu and Robinson
Institutions Matter, but Not for Everything by Jeffrey Sachs
Government, Geography, and Growth: The True Drivers of Economic Development by Jeffrey Sachs
Which Came First–Democracy or Growth? by Rubén Hernández-Murillo and Christopher J. Martinek
https://www.stlouisfed.org/publications/regional-economist/april-2008/which-came-firstdemocracy-or-growth
Institutions Matter? By Adam Przeworski
The Last Instance: Are Institutions the Primary Cause of Economic Development? By Adam Przeworski
Geography vs. Institutions Revisisted: Were Fortunes Reversed? By Adam Przeworski
http://politics.as.nyu.edu/docs/IO/2800/reversal.pdf
Evaluating Recipes for Development Success by Avinash Dixit
Do Institutions Cause Growth? By Glaeser, Edward L, Rafael LaPorta, Florencio López-de-Silanes, and Andrei Shleifer. 2004.
Institutions and Economic Development: Theory, Policy and History by Ha-Joon Chang
http://journals.cambridge.org/abstract_S1744137410000378
Institutions versus Policies: A Tale of Two Islands by Peter Blair Henry and Conrad Miller
Why Has the Grass Been Greener on One Side of Hispaniola? A Comparative Growth Analysis of the Dominican Republic and Haiti by LAURA JARAMILLO and CEMILE SANCAK
http://www.palgrave-journals.com/imfsp/journal/v56/n2/pdf/imfsp200840a.pdf