Nobel Prize for research on prosperity
Daron Acemoğlu, Simon Johnson and James A. Robinson have been awarded the Nobel Prize in economics for their work on the prosperity gap between countries. At the centre of their research is the connection between the functioning of state institutions and the prosperity of different societies. Europe's press comments.
Turkey failed to heed their advice
In Karar, columnist Taha Akyol laments that the Turkish leadership didn't listen to Nobel Prize winner Daron Acemoğlu:
“In all his statements, Acemoğlu praised Turkey's growth between 2001 and 2008 because it was based on productivity. He criticised and even expressed concern about the period that followed because during that time productivity did not increase and growth was fuelled by consumption and yield on capital instead. He repeatedly criticised the political pressure on the Central Bank and the cronyism within the bureaucracy. ... I wish the government had listened to Acemoğlu and other proper economists back in 2012-2013. If it had, we could have reached a per capita income of 25,000 dollars [around 23,000 euros] by now. It's a shame about the lost years.”
No inclusive institutions in Russia
Exiled politician Maxim Katz explains in Echo how the prizewinners assess Russia's institutions in their most recent publications:
“According to the researchers, Russia was never a country with inclusive institutions at any stage of its development. Neither as a Russian empire with its serfdom and autocracy, nor during the Soviet era, when forced labour and disenfranchised peasants who could not leave the collective farms were the norm, nor in Putin's current Russian Federation, where the leadership has focused on skimming off the oil profits and depriving citizens of their political rights. The authors see Russia - like China, incidentally - as countries whose economic growth is limited by their own institutions.”
Others are further along
Other economists are more deserving, taz argues:
“Daron Acemoğlu, Simon Johnson and James Robinson have all been looking at why countries stay poor although they have the potential for development. Their answer: these states are being plundered by a tiny elite, as is the case in Latin America. But this 'institutional' approach has its weaknesses: ... The role of high wages, trade unions and fair tax policies is not discussed in depth. This gap has been filled by other economists – in particular by two Frenchmen, Emmanuel Saez and Gabriel Zucman. Their model genuinely deserves the Nobel Prize.”
Autocracy fans should take note
The Frankfurter Allgemeine Zeitung notes:
“One of the economists' empirically tested central theses is that democracies are economically superior to autocracies in the long term because a state under the rule of law creates better conditions for entrepreneurs and consumers than an autocracy which places people at the mercy of the whims of the powers that be. These findings will be helpful for many people, especially those who in the current climate are railing against democracy and hoping for strong men (or women) to show them the way into the future. The economic rise of the People's Republic of China does not refute the Nobel laureates' argument. Autocratic regimes can catch up with and copy industrialisation, but innovation has always been more likely to happen in democracies.”
Will China stagnate?
Expressen is interested in their predictions for China:
“The laureates distinguish between inclusive and extractive institutions in former colonies. In places dominated by inclusive institutions, people are encourage to be creative and enjoy their work. Where extractive institutions dominate, local elites have taken over the role of colonial rulers and have little interest in change. Acemoğlu and Robinson presented their findings in the 2012 book 'Why Nations Fail'. There they boldly predict China's coming stagnation – a lack of participation will gradually stifle the spirit of invention, they say. It is possible that Xi Jinping is in the process of proving them right.”