The book can also be useful as a basis for critical examination of the quality of well-developed countries' institutions, effects of economic governance models and political development after the introduction of the welfare society.
[14] For example, in a 2002 article, they showed, through statistical analysis, that institutional factors dominate culture and geography in determining the GDP per capita of different countries.
These aspects of technology's accessibility to prosperity are detailed in Daron Acemoglu and Simon Johnson's recent book Power and progress.
In search of the reasons why, in some countries, we observe this phenomenon, while others seem to have frozen in time, the authors come to the conclusion that for scientific and technological progress, it is necessary to protect the property rights of a wide strata of society and the ability to receive income from their enterprises and innovations (including from patents for inventions).
With pluralistic political institutions, a decision is made that is beneficial to the majority, which means that the inventor of the previous one will not be able to prevent a patent for a new invention and, thus, there will be a continuous improvement of technologies.
[20][21] The interpretation of economic growth, as a constant change of goods and technologies, was first proposed by Joseph Schumpeter, who called this process creative destruction.
[24] Since only pluralistic political institutions can guarantee that the owners of existing monopolies, using their economic power, will not be able to block the introduction of new technologies, they, according to the authors, are a necessary condition for the country's transition to sustainable development.
The authors use historical examples, such as the Glorious Revolution in Great Britain, to illustrate the importance of democratic pluralism for economic development.
[39] Their paper examines the historical democratization of Western Europe and Latin America and highlights the role of revolution threats and elite desires for economic redistribution in the transition to democracy.
Similarly, this game also provides insights into how variables like exit payoff, cost of voicing, and value of loyalty change state's behavior as to whether or not to predate.
The study reveals that in countries where the disease environment made it difficult for colonizers to survive (high mortality rate), they established extractive regimes, resulting in poor economic growth today.
Therefore, the mortality rate among colonial settlers, hundreds of years ago, has determined the economic growth of present-day post-colonial nations, by setting them on divergent institutional paths.
In the case of the Glorious Revolution, the winning merchant class established property rights laws and limited the power of the monarch, which, essentially, promoted economic growth.
Indian economist Arvind Subramanian points out the potential problem of reverse causality in Acemoglu and Robinson's theory in his publication in The American Interest.
It is unsatisfying that the theory cannot explain the situation of such a large portion of the world's population, and it is unlikely that China or India will change, significantly, in the near future, according to the book's prediction.
In China, they note, political institutions have played a role in driving economic reform, since 1978, when Deng Xiaoping implemented the opening up policy.
David R. Henderson wrote a generally positive review in Regulation[29] but criticized the authors for inconsistency regarding the role of a central government in promoting development.
[29] In his article in The American Interest,[47] Francis Fukuyama criticized Acemoglu and Robinson's argument for being similar to a book by North, Wallis, and Weingast in 2009.
He suggests that differences in wealth are due to weather conditions, such as higher disease rates and lower agricultural productivity in tropical areas.
Diamond also criticizes Acemoglu and Robinson for their narrow focus on small historical events, like the Glorious Revolution, while ignoring prosperity in Western Europe.
In response to Diamond's criticism,[50] the authors reply that the arguments in the book do take geographical factors into account but that geography does not explain the different level of development.
They introduce the theory of Reversal of Fortune, which explains how previously poor countries, like the U.S., Australia, and Canada, have become wealthy, despite limited natural resources.
For instance, he pointed out that the prevalence of tropical diseases in Zambia leads to prolonged illness among male workers, greatly reducing their productivity.
[51] According to Jeffrey Sachs,[52] an American economist, the major problem of Why Nations Fail is that it focuses, too narrowly, on domestic political institutions and ignores other factors, such as technological progress and geopolitics.
For example, geography plays an important role in shaping institutions and weak governments in West Africa may be seen as a consequence of the unnavigable rivers in the region.
Several examples in Asia, including Singapore and South Korea, easily refute Acemoglu and Robinson's arguments that democratic political institutions are prerequisites for economic growth.
[54] Collier's review summarizes two essential elements for growth from the book: first, a centralized state and second, inclusive political and economic institutions.
Based on the case of China, a centralized state can draw a country out from poverty, but without inclusive institutions, such growth is not sustainable, as argued by Acemoglu and Robinson.
Warren Bass reviewed the book for the Washington Post, writing: "It's bracing, garrulous, wildly ambitious, and ultimately, hopeful.
Second, though Acemoglu and Robinson are ambitious in covering cases of all nations across history, this attempt is subjected to the scrutiny of regional experts and historians.