Based on the book Why
Nation Fail
by Daron Acemoglu and James Robinson
In the 14th Century the Plague wiped
out almost half of the world's population. This catastrophic event was the
catalyst for our modern inclusive institutions. The loss of so many citizens
left a void in Europe that caused two very different scenarios. In the east
extraction persisted both economically and politically. While in the west feudalism
was almost altogether abandoned due to the labor shortage, sending us down a
path of inclusion. Broadly, inclusion refers to active participation. Inclusive
economic institutions, "are those that allow and encourage participation
by the great mass of people in economic activities that make best use of their
talents and skills and that enable individuals to make the choices they
wish." (74) Some key tenets being property rights, a rule of law, and
basic public services. Inclusive political institutions follow the same basic
ideas and boast pluralism and centralization. On the opposite side of the
spectrum lies extractive institutions, "extractive because such
institutions are designed to extract incomes and wealth from one subset of
society to benefit a different subset." (76) Property rights are almost
non-existent under extractive institutions and if they did exist, rule of law
would be so that no one would enforce them. Political institutions that are
extractive narrowly distribute power and are often completely unrestrained in
every aspect.
Several things happened in Western
Europe, specifically England, to facilitate inclusion. The English Civil War
and the Glorious Revolution were both results of the institutional struggles
that were adverse to the average citizen. "The Glorious Revolution of
1688...limited the power of the King and the executive, and relocated to
Parliament the power to determine economic institutions." (102) Once a
footing for inclusion was found it gradually persisted, growing through the
increased liberty and the notion of a rule of law, speeding up the process of
political centralization and creating the, "world's first set of inclusive
political institutions." (102) A direct consequence was the spreading of
inclusion to the economic sector. This is what the authors referred to as the
virtuous circle. As inclusion is advanced it naturally fosters more inclusive
institutions, allowing them to persist and exist. Opposite, the vicious circle
allows for tyranny to ensue until it collapses under its own weight.
The
authors argue that the emergence of more inclusion in politics following the
Glorious Revolution had several contributing factors. Power was being diverted
to middle class and they had a direct incentive to maintain as much inclusion
as possible. Next was the broad coalitions that were formed by the newly
enfranchised people. Successful because of numbers and diversity. This was not
a revolution brought about by narrow interests, but by these newly formed
political groups. Finally, the political history at the time allowed for a
foundation for which more inclusive regimes could form. Specifically England
and France's history of parliaments facilitated this as well as both countries
had previously started shifting ideology away from absolutism to more
pluralistic ones.
The virtuous circle is able to
maintain momentum because once in place power transfers are mandated by law.
This makes it difficult to seize any more power than is delegated, with checks
and balances maintaining accountability. Second is that inclusive political
institutions are supported by inclusive economic institutions; they remove
extractive ones by mandating laws against things like slavery and not granting
government monopolies. Third, and maybe most important, it allows for free
media to exists. Media is important because it provides important information
to the masses and allows for resistance and assemblage in opposition to threats
against inclusive institutions.
No comments:
Post a Comment