Quotes from Daron AcemoÄŸlu

There could be some economic growth without innovation, relying on existing technology, but it was growth without creative destruction. And it did not last.

The only way of achieving durable liberty is to . . . forge the balance necessary for building a Shackled Leviathan. True liberty can flourish neither without a state nor under the yoke of a Despotic Leviathan. But there is no universal way of building a Shackled Leviathan . . . Every country's prospects are molded by its unique history, the types of coalitions and compromises that are possible, and the exact balance of power between state and society.

Economic institutions that create incentives for economic progress may simultaneously redistribute income and power in such a way that a predatory dictator and others with political power may become worse off.

For my friends, everything; for my enemies, the law.

Central planning was just not good at replacing what the great eighteenth-century economist Adam Smith called the "invisible hand" of the market. When the plan was formulated in tons of steel sheet, the sheet was made too heavy. When it was formulated in terms of area of steel sheet, the sheet was made too thin. When the plan for chandeliers was made in tons, they were so heavy, they could hardly hang from ceilings.

In the same way, current Chinese growth has nothing to do with Chinese values or changes in Chinese culture; it results from a process of economic transformation unleashed by the reforms implemented by Deng Xiaoping and his allies, who, after Mao Zedong's death, gradually abandoned socialist economic policies and institutions, first in agriculture and then in industry.

We call such institutions, which have opposite properties to those we call inclusive, extractive economic institutions—extractive because such institutions are designed to extract incomes and wealth from one subset of society to benefit a different subset. E

The creative destruction that would be wrought by the process of industrialization would erode the leaders' trading profits and take resources and labor away from their lands. The aristocracies would be economic losers from industrialization. More important, they would also be political losers, as the process of industrialization would undoubtedly create instability and political challenges to their monopoly of political power.

When the barons and local elites recognize that political power will be increasingly more centralized and that this process is hard to stop, they will make demands to have a say in how this centralized power is used.

Indeed, even though Santa Ana was president in Mexico, large parts of the country were not under his control, which enabled the annexation of Texas by the United States.

Though the policies of Stalin and subsequent Soviet leaders could produce rapid economic growth, they could not do so in a sustained way. By the 1970s, economic growth had all but stopped. The most important lesson is that extractive institutions cannot generate sustained technological change for two reasons: the lack of economic incentives and resistance by the elites.

Though Mexico had constitutions in the nineteenth century, they put few constraints on what Iturbide, Santa Ana, and Díaz could do. These men could be removed from power only the same way they had attained it: by the use of force. D

liberty requires not just the abstract notion that you are free to choose your actions, but also the ability to exercise that freedom.

If these rulers would only get the right advice from the right advisers, the thinking goes, prosperity would follow.

los líderes de los países pobres son ignorantes. La consecuencia es que las políticas no se adoptan ni se implantan, o se implantan solamente de nombre.

But dominance doesn't just originate from brute force or threats of violence. Any relation of unequal power, whether enforced by threats or by other social means, such as customs, will create a form of dominance, because it amounts to being

The apogee of Progressive reforms came with the election of Woodrow Wilson in 1912. Wilson noted in his 1913 book, The New Freedom, "If monopoly persists, monopoly will always sit at the helm of government. I do not expect to see monopoly restrain itself. If there are men in this country big enough to own the government of the United States, they are going to own it.

tienen el poder toman decisiones que crean pobreza. No lo hacen bien, no porque se equivoquen o por su ignorancia, sino a propósito.

Madison sostuvo que las Constituciones debían diseñarse de modo que «debe hacerse que la ambición contrarreste a la ambición».

Most important perhaps, in most of these cases there were enormous benefits from holding power. These benefits both attracted the most unscrupulous men, such as Stevens, who wished to monopolize this power, and brought the worst out of them once they were in power. There was nothing to break the vicious circle. N

The people who suffer from the extractive economic institutions cannot hope for absolutist rulers to voluntarily change political institutions and redistribute power in society. The only way to change these political institutions is to force the elite to create more pluralistic institutions.

the colonists in Jamestown perished. Of the five hundred who entered the winter, only sixty were alive by March. The situation was so desperate that they resorted to cannibalism.

when a critical juncture arrives, these small differences that have emerged as a result of institutional drift may be the small differences that matter in leading otherwise quite similar societies to diverge radically.

the secret ballot was introduced and moves were made to eliminate corrupt electoral practices such as "treating" (essentially buying votes in exchange for which the voter received a treat, usually money, food, or alcohol). The