Commenter “ThePolyCapitalist” at Marginal Revolution stated that Stephen Broadberry (who I had not heard of before) had given a critique of “Why Nations Fail” that James Robinson was not prepared for. I decided to contact Broadberry and see if his argument was available anywhere online. He sent me a powerpoint, but since there weren’t graphics or anything I think his notes will work fine as text in a blog post:
Comments on “Why Nations Fail: The Origins of Power, Prosperity and Poverty” by Daron Acemoglu and James A. Robinson

Stephen Broadberry
London School of Economics

IMPLICATIONS FOR ECONOMIC
HISTORIANS

• 1. Gap in the market
• 2. Methodology
• 3. Filling the gap

1. GAP IN THE MARKET

• AR fills a gap in the market left by economic historians, who tend to focus on highly
specialised topics
• Greg Clark: ‘No one has published a paper yet entitled “The Heights of Norwegians Inferred from a Sample of 23 File Clerks, 1906-1908: A Quantile Bend Estimate,” but given enough time they will.’
• Economic historians wary of straying outside own particular regions or periods, hence new research not being pulled together

Gap in the market

• Since LR development continues to be of much popular interest, vacuum left by dearth of general overview books by economic historians filled in recent years by economists
• As well as literature on institutions there is unified growth theory which emphasises human capital via linkages to demography and
technology
• But approach of economists is very different from approach of economic historians

Schumpeter (1954: 815)

• “There are such things as historical and theoretical temperaments. That is to say, there are types of minds that take delight in all the colors of historical processes and of individual cultural patterns. There are other types that prefer a neat theorem to everything else. We have use for both. But they were not made to appreciate one another.”

2. METHODOLOGY

• AR methodology deigned for those with a theoretical temperament: although world looks complex, useful theories are simple and
abstract from unnecessary detail
• There is a danger of losing track of the narrative when delving in the rich colours of historical processes, but need also to be alert to danger of imposing theoretical priors on history

Methodology

• In AR, institutions monocausally explain growth, but evolution of institutions is determined by “historical contingencies”
• So history is there but only in a way that is impossible to refute
• For each country that developed, AR find a historical contingency that made institutions more inclusive just before onset of growth,
which “explains” what happened

2. Methodology

• I would certainly acknowledge a role for random events, but can that really be everything?
• And isn’t it odd that these random events were so concentrated in Western Europe?

3. FILLING THE GAP

• Until recently, systematic data on long run development started in C19th, so that quantitative study of the topic of this book not really possible
• But that has been changing for the last 10-15 years, starting with Maddison’s “guesstimates” of GDP per capita for a few benchmark years, which has stimulated an industry of data processing
• For many countries, an abundance of data is available ,which can be processed to provide a detailed record of the economy

Filling the gap

• If you face observations for p.c. income or urbanisation rates in Britain in 1600 and 1700, it may be natural to look for events such as Glorious Revolution of 1688 to explain changes between those 2 dates
• But with annual data on most of the key variables now available for many countries that are crucial to argument of this book, more account can be taken of those rich colours of historical processes

Filling the gap

• My account of English development would stress the importance of the large pastoral component of agriculture already by the middle ages, which was high-value-added, capital-intensive, non-human- energy-intensive and provided employment for women, with implications for fertility
• As these techniques spread from agriculture to industry and services, and as European Marriage Pattern encouraged human capital formation as well as restricted fertility, Britain developed and went through a demographic transition

Filling the gap

• Glorious Revolution and institutions would be a part of the story, but I see no compelling reason to treat direction of causality from
institutions to growth rather than from growth to institutions
• Agricultural system in England similar to rest of NW Europe, which might help to explain why all those historical contingencies occurred there around the same time

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