Daron Acemoglu

More than hundred posts later I am no where near to understanding economic matters or the great divergence. One economist who seems to make some sense to me is Daon Acemoglu. Here is a brief description of his work from
economicprincipals :

"Daron Acemoglu's good fortune was to graduate from the University of York at the very moment that the hourglass of development economics was at its narrowest, when all the complications of economic growth had been briefly reduced to an argument about the causes of "technical change."

Like Gerschenkron, Acemoglu had been raised in a developing society -- in Istanbul, a Turk of Armenian descent. His father was a professor of law, later an attorney for banks and corporations. Political economy and development strategy came naturally to the dinner table.

But his parents died when Acemoglu was in his teens. Political science at York disappointed him; he switched to economics instead. And when MIT admitted him to graduate school but failed to offer a scholarship, he did his doctorate at the London School of Economics instead, writing a dissertation on a variety of labor and macroeconomic topics. A year later, MIT hired him to teach -- an intriguing but unknown quantity at whom they wanted a closer look. Four years later they gave him tenure. He added dual citizenship as well.

The committee that gave the 38-year-old Acemoglu the Clark medal last week described him as "extremely broad and productive," noting that in the course of a dozen years he had made significant contributions to the study of labor markets before moving on to "especially innovative" ideas about the role of institutions in development and political economy.

In fact, it was a series of investigations in the history of the European colonization of much of the rest of the world, beginning in the 15th century, that made Acemoglu's reputation, demonstrating that institutions of various sorts were more important to development than economists previously had thought. The "rules of the game" -- the structure of property rights, the presence of markets, and their various frictions, the form that governments take -- are key determinants of what happens next, Acemoglu showed, in some unusually inventive and convincing ways.

Take the rise of Europe in the first place. The importance of the Atlantic trade had long been noted, and various reasons for it advanced. With Simon Johnson of MIT's Sloan School and James Robinson of the University of California at Berkeley, Acemoglu argued in "The Rise of Europe: Atlantic Trade, Institutional Change and Economic Growth" that England and the Netherlands leapt out front because a newly emergent merchant class benefited most from trade -- and was able to successfully demand institutions to protect their property and commerce. In contrast, although they had been the first to discover the richest lands, Spain and Portugal stagnated because their monarchies had managed to capture the early returns, they argued -- and thus were able to thwart their merchants' drive for power.

In "Economic Backwardness in Political Perspective," Acemoglu and Robinson argued that political elites can be expected to pursue "blocking" strategies when innovation threatens their monopolies and when there is little threat to their power from politics. External threats reduced the temptation to block, they found -- producing a model that suggested why Britain, German and the United States had industrialized during the 19th century, while the landed aristocracies in Russia and Austria-Hungary sought to hold back the tide.

In "Reversal of Fortune," Acemoglu, Johnson and Robinson argued that colonial powers pursued very different strategies in different lands, with fateful consequences. In rich and densely populated countries such as Mexico and Peru, they extracted wealth; in poor and sparsely settled countries such as British North America and Argentina, they encouraged investment.

And in "The Colonial Origins of Comparative Development" they inventively teased evidence from differing mortality rates faced by Europeans in different countries of how the choices made in those circumstanced gave rise to different institutions and so to different development paths.

The Clark committee noted that some of the methods and conclusions were still being debated -- but that a broad and substantial rethinking of the development process was underway no matter what. The appearance this summer of Acemoglu's book with Robinson, The Economic Origins of Dictatorship and Democracy will stimulate much further discussion. The MIT course that he teaches with fellow professor Abhijit Bannerjee on development issues is routinely oversubscribed. And a long list of projects underway testifies to his staying power."
Many of Acemoglu's publications can be found here.
Among science writer-reviewers H. Allen Orr seems excellent. Here is a brief introduction to Orr.
Some more articles by Orr at NY Review of Books .