Audio available in app
Extractive institutions discourage investment and entrepreneurship from "summary" of Why Nations Fail by Daron Acemoglu,James A. Robinson
Extractive institutions are those that are designed to extract resources from the economy for the benefit of a small elite, rather than to promote economic growth and development. In extractive societies, the political and economic institutions are set up in a way that discourages investment and entrepreneurship. This is because individuals and companies are unlikely to invest in an economy where property rights are not secure, contracts are not enforced, and there is rampant corruption. When property rights are not secure, individuals have little incentive to invest in improving their assets or starting new businesses. Without the confidence that they will be able to reap the benefits of their investments, people are hesitant to take risks. In extractive societies, property rights are often controlled by those in power, who can easily confiscate assets or change the ru...
Similar Posts
The pursuit of utopian ideals can result in tyranny
The idea that a utopian society can be achieved through central planning has been a persistent and alluring fantasy throughout ...
Innovation leads to entrepreneurship
The process of innovation can be seen as a catalyst for the emergence of entrepreneurship in the economic landscape. When indiv...
Economic systems adapt to changing circumstances
Economic systems are dynamic entities that respond to the ever-changing circumstances of the environment in which they operate....
Knowledge spillovers contribute to technological advancement
The process of technological advancement is not limited to individual firms or industries working in isolation. Instead, knowle...
Independence is nonnegotiable
Independence is nonnegotiable. It is the fundamental principle that guides our actions and decisions. It is the bedrock upon wh...
Economic collapse
The concept of economic collapse in 'Atlas Shrugged' is vividly portrayed as a result of the government's intervention and cont...
Education is a tool for empowerment and resistance
Education, in its essence, serves as a powerful instrument for individuals to empower themselves and resist oppression. Through...
Environmental factors shape human societies
Environmental factors play a crucial role in shaping the development of human societies. The availability of certain resources,...
Understand currency markets for currency trading
Currency markets are a fascinating world unto themselves. The movements of currencies can be influenced by a wide range of fact...
Barbarian invasions hastened the fall of Rome
The decline of Rome was not a sudden event but a slow process that took place over several centuries. One of the key factors th...