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Good question, and that's it
le 27 janvier 2015
The authors' endeavor is really an interesting one: between the forces of nature, geography and the like shaping human history (a la Jared Diamond) and the effects of individual people (e.g. a guy like Napoleon), there are the effects of institutions. What could be those effects? Very interesting question indeed, and the beginning where the authors give a couple of examples to justify the relevance of the questioning (by showing how the current development level of different regions in South America matches with some institutions of the Conquistadors era) is enticing. And then, the authors try to answer their own questions, and it goes south very very fast.
How do they answer that? They come up with the concept of inclusive and extractive institutions and economic system. Inclusive is good, extractive is bad. How do they define the difference? Hindsight, cherry-picking history (actually, not even that, just plain wrong history) and repeating ad nauseam the tenets of free-marketers.
So monopoly granted by patent law to Thomas Edison? Good, because this fits the current economic mantra of free-market, so this monopoly is thus viewed as "stable institutions", "guarantee of possible return of investment", etc. And oh surprise, Edison was successful!!
Monopoly granted by decree of king James Umpteenth to the East Bay Stuff Company? Bad, because this is just cozying up to your cronies, against free market. etc. And oh surprised, Jamestown was a catastrophy!! See I told you! So then, according to the authors, inclusive institutions were then put in place there, and tada! it worked. Of course, you have to forget that early America expanded because the colonists extracted land from the natives, but eh! as long as it is not like Spain did, it is not the same. Basically the authors acknowledge that every institution is at once both inclusive and exclusive, but the problem is that they choose to shine a light on a side BECAUSE of the current success or problems of the relevant countries. This is at best ignorant cherry-picking, but it is more in my opinion complete dishonesty and rationalization post facto.
But this is not the worst. The worst is the plainly wrong history. Those guys are actually arguing without laughing that the Black Plague of 1348 is actually the reason why serfdom disappeared in Western Europe. You know, they dug out a couple of charters from the English king that mentions the labor shortage, they then extrapolate a conclusion that fits their premise, and they extend it to the whole Western Europe, because you know, you have to justify the difference with Eastern Europe. Anyone with a modicus of knowledge of Ancient and Medieval European History will cringe reading this book. Forget for example, that serfdom had long declined long before that in France! Nope, it doesn't fit the narrative so let's overlook it. Oh, and a map of the situation of serfdom in Europe in 1800 with MODERN border states? Yep. They do that too!
So we are told history lessons such as: "The political institutions forming the core of the Roman Republic were overthrown by Julius Caesar in 49 BC when he moved his legion across the Rubicon". Really?? "It was this transition from republic to principate and later naked empire that laid the seeds of the decline of Rome". And because the causality is far from being demonstrated, the authors rely on commas. Literally. As in "I farted in the lift, the polar ice cap melted." to demonstrated that me farting actually melted the icecap.
The end of this chapter is typical of the authors: having cherry picked an institutional fact, they must reconcile the fact that the consequences of their cherry picked item don't happen before centuries, so we have stuff like (I quote in extenso without cuts) "The changes unleashed by Augustus as with the Venetian serrata, were at first political but then would have significant economic consequences. As a result of these changes, by the fifth century AD the Western Roman Empire, as the West was called after it split from the East, had declined economically and militarily, and was on the brink of collapse" Damn you Augustus!!! You are the cause of the fall of Rome!
Speaking of Venice, they conclude: "[In 1324] This was the beginning of the end of Venetian prosperity. With the main lines of business monopolized by the increasingly narrow elite, the decline was under way. Venice appeared to have been on the brink of becoming the world's first inclusive society, but it fell to a coup. Political and economic institutions became more extractive and Venice began to experience economic decline. By 1500 the population had shrunk to one hundred thousand. Between 1650 and 1800, when the population of Europe rapidly expanded [note: this is not true for France] that of Venice contracted."
Yeah you read that right, we jump from an institutional change in 1324 to population consequence 175 years later, then 325 years and 475 years later. Oh! Did the fact that the Eastern Mediterranean had fallen under the rule of the Ottoman in the meantime have anything to do with the decline of Venice? No of course not. Did the fact that trade routes switch to the Atlantic trade post-1500 have anything to do with the decline of Venice? Of course not! It is the tightening of the elite in 1324 that is responsible!!
The whole historical argumentation is filled with such rubbish. When on top of that, you get what many other reviewers have said, which is repetition of the argument ad nauseam, circular reasoning, etc. you end up with a book that has only one star because it actually asks a good question and then proceed to demonstrate only the crass ignorance of its authors, and their lack of proper reasoning. Since I have a Kindle edition, I can not even use it as a door-stop. A book to avoid.