Acemoglu and Robinson - Book Report/Review Example

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Question 1: In chapters 8 and 9, A&R argue that extractive institutions are not the only reasons (causes) for countries to become poor and economically underdeveloped. They argue that poverty and underdevelopment are sometimes “imposed” and forced on countries. What do they…
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Question In chapters 8 and 9, A&R argue that extractive s are not the only reasons (causes) for countries to become poor and economically underdeveloped. They argue that poverty and underdevelopment are sometimes “imposed” and forced on countries. What do they mean by this? What are some examples?
Foreign aid is one of the strategies used to impose poverty into poor countries. Acemoglu and Robinson (2012) argue that foreign aid cannot assist poor economies overcome their challenges. They argue that primacy of institutions and politics has important implications for policy. Growth can be achieved in poor economies through trade liberalization1. However, trade liberalization has not been granted by developed economies. Poor countries have no trade policies that can assist in exporting their goods to other markets. Foreign aid alone cannot assist poor economies because corrupt institutions misuse foreign aid for their selfish gains. In war torn countries such as Syria and Iraq, bad institutions exist because they are imposed on the citizens by the elite who do not want a change in the status quo. In Africa, it is difficult to explain how Botswana is richer than Sierra Leone. In particular, the elite are concerned about the welfare of the population while in Zimbabwe; the elite do not want the situation to change for the benefit of the citizens. Poverty in Zimbabwe, DR Congo, and Sierra Leone are, therefore, imposed by the elite2.
Neo-colonialism still affects Africa even through colonial masters left Africa several decades ago. Acemoglu and Robinson (2012) argue that neo-colonization determines how governments in poor countries are managed. Poor economies in Africa are still colonized. Acemoglu and Robinson argue that colonial masters determine economic growth for the poor countries. The colonial powers want the political actors in an economy to remain without change. Colonial powers, as well as developed economies in the world, do not want a change in the management of institutions3. In particular, countries like the United States should send policy makers to poor countries on how they should improve the management of institutions. However, developed economies want the status quo to continue because they have political interests in the management of these poor economies. For example, Democratic Republic of Congo is one of the poorest countries in the world despite the numerous mineral resources.
In poor countries such as Democratic Republic of Congo, poverty is imposed by colonial powers because they have vested interest in the exploitation of mineral resources. Colonial powers do not want peace to prevail. Several civil wars in Africa are financed by institutions financed by colonial powers. Maintenance of the status quo is part of the attempts of imposing poverty and poor economic growth in some countries in the world.
Acemoglu and Robinson (2012) argue that ineffective institutions are the product of political systems designed to achieve private gains for the elites in developing countries4. The elites in developing countries impose poverty on their countries, even if their actions impoverish the broader society. For example, in Nigeria, there are multimillionaires who constitute 10% of the population while 90% of the population lives in poverty. It is evident that the elite in Nigeria do not want any change in the management of institutions. The elite impose poverty on their country because any change would mean their demise in the management of resources and institutions. Violence has become a strategy used by the elite, to impose poverty. In poor economies, civil wars and violence are funded by the elite so that their interests become supreme in the society. Any political resistance is thwarted by the elite. For example, elections in poor economies do not reflect democratic principles. In most cases, elections in poor economies are used to impose leaders on the poor.

Works Cited
Acemoglu Daron and Robinson James. Why Nations Fail: The origins of Power, prosperity and poverty. New York. Profile Books, 2012. Accessed on 11/15/13, from: Read More
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