--- title: "16 Economic Institutions Quotes By Daron Acemoğlu" description: "16 Economic Institutions quotes by Daron Acemoğlu. Plus more from Daron Acemoğlu and more Economic Institutions sayings from other authors." image: "https://sms4smile.com/quotes/i/7e0/daron-acemo-lu-4415_quote_we-call-such-institutions-which-have-opp_1069746.jpg" --- > [“We call such institutions, which have opposite properties to those we call inclusive, extractive economic institutions—extractive because such institutions are designed to…](https://sms4smile.com/quotes/daron-acemo-lu/we-call-such-institutions-which-have-opposite-properties-to-those-we/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/7e0/daron-acemo-lu-4415_quote_we-call-such-institutions-which-have-opp_1069746.jpg) > [“Inclusive economic institutions, such as those in South Korea or in the United States, are those that allow and encourage participation by…](https://sms4smile.com/quotes/daron-acemo-lu/inclusive-economic-institutions-such-as-those-in-south-korea-or-in-2/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/297/daron-acemo-lu-4415_economics_inclusive-economic-institutions-such-as_863424.jpg) > [“Economic institutions that create incentives for economic progress may simultaneously redistribute income and power in such a way that a predatory dictator…](https://sms4smile.com/quotes/daron-acemo-lu/economic-institutions-that-create-incentives-for-economic-progress/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/1a4/daron-acemo-lu-4415_economics_economic-institutions-that-create-incent_1988539.jpg) > [Inclusive economic institutions require secure property rights and economic opportunities not just for the elite but for a broad cross-section of society.](https://sms4smile.com/quotes/daron-acemo-lu/inclusive-economic-institutions-require-secure-property-rights-and/) [Daron Acemoglu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/a72/daron-acemo-lu-4415_broads_inclusive-economic-institutions-require_317208.jpg) > [“Congo, vividly illustrates how political institutions determine economic institutions and, through these, the economic incentives and the scope for economic growth.”](https://sms4smile.com/quotes/daron-acemo-lu/congo-vividly-illustrates-how-political-institutions-determine/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/b8f/daron-acemo-lu-4415_economic-growth_congo-vividly-illustrates-how-political_2898856.jpg) > [“NATIONS FAIL TODAY because their extractive economic institutions do not create the incentives needed for people to save, invest, and innovate. Extractive…](https://sms4smile.com/quotes/daron-acemo-lu/nations-fail-today-because-their-extractive-economic-institutions-do-2/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/f0b/daron-acemo-lu-4415_failure_nations-fail-today-because-their-extract_311353.jpg) > [“THE CONTRAST OF South and North Korea, and of the United States and Latin America, illustrates a general principle. Inclusive economic institutions…](https://sms4smile.com/quotes/daron-acemo-lu/the-contrast-of-south-and-north-korea-and-of-the-united-states-and/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/ade/daron-acemo-lu-4415_economic-prosperity_the-contrast-of-south-and-north-korea-an_3008065.jpg) > [“Inclusive economic institutions, such as those in South Korea or in the United States, are those that allow and encourage participation by…](https://sms4smile.com/quotes/daron-acemo-lu/inclusive-economic-institutions-such-as-those-in-south-korea-or-in/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/e12/daron-acemo-lu-4415_economics_inclusive-economic-institutions-such-as_665136.jpg) > [“during the critical juncture created by the Industrial Revolution, many nations missed the boat and failed to take advantage of the spread…](https://sms4smile.com/quotes/daron-acemo-lu/during-the-critical-juncture-created-by-the-industrial-revolution/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/7b5/daron-acemo-lu-4415_industrial-revolutio_during-the-critical-juncture-created-by_1177325.jpg) > [“The ability of economic institutions to harness the potential of inclusive markets, encourage technological innovation, invest in people, and mobilize the talents…](https://sms4smile.com/quotes/daron-acemo-lu/the-ability-of-economic-institutions-to-harness-the-potential-of/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/bcf/daron-acemo-lu-4415_economic-growth_the-ability-of-economic-institutions-to_1867333.jpg) > [“Inclusive economic institutions also pave the way for two other engines of prosperity: technology and education. Sustained economic growth is almost always…](https://sms4smile.com/quotes/daron-acemo-lu/inclusive-economic-institutions-also-pave-the-way-for-two-other/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/01f/daron-acemo-lu-4415_change_inclusive-economic-institutions-also-pav_666351.jpg) > [“Economic institutions shape economic incentives: the incentives to become educated, to save and invest, to innovate and adopt new technologies, and so…](https://sms4smile.com/quotes/daron-acemo-lu/economic-institutions-shape-economic-incentives-the-incentives-to/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/b35/daron-acemo-lu-4415_economics_economic-institutions-shape-economic-inc_1830476.jpg) > [“The Industrial Revolution started and made its biggest strides in England because of her uniquely inclusive economic institutions. These in turn were…](https://sms4smile.com/quotes/daron-acemo-lu/the-industrial-revolution-started-and-made-its-biggest-strides-in/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/c85/daron-acemo-lu-4415_industrial-revolutio_the-industrial-revolution-started-and-ma_1517850.jpg) > [“Extractive institutions are so common in history because they have a powerful logic: they can generate some limited prosperity while at the…](https://sms4smile.com/quotes/daron-acemo-lu/extractive-institutions-are-so-common-in-history-because-they-have-a/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/ae5/daron-acemo-lu-4415_economics_extractive-institutions-are-so-common-in_1976556.jpg) > [“Finally, when growth comes under extractive political institutions but where economic institutions have inclusive aspects, as they did in South Korea, there…](https://sms4smile.com/quotes/daron-acemo-lu/finally-when-growth-comes-under-extractive-political-institutions-but/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/281/daron-acemo-lu-4415_political-power_finally-when-growth-comes-under-extracti_2435069.jpg) > [“NATIONS FAIL TODAY because their extractive economic institutions do not create the incentives needed for people to save, invest, and innovate. Extractive…](https://sms4smile.com/quotes/daron-acemo-lu/nations-fail-today-because-their-extractive-economic-institutions-do/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/382/daron-acemo-lu-4415_civil-war_nations-fail-today-because-their-extract_231202.jpg) ## More by Daron Acemoğlu > [“AUSTRALIA, LIKE THE UNITED STATES, experienced a different path to inclusive institutions than the one taken by England. The same revolutions that shook England…](https://sms4smile.com/quotes/daron-acemo-lu/australia-like-the-united-states-experienced-a-different-path-to/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“As such, the usual pattern of interaction between a critical juncture and existing institutional differences leading to further institutional and economic divergence played out…](https://sms4smile.com/quotes/daron-acemo-lu/as-such-the-usual-pattern-of-interaction-between-a-critical-juncture/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“Lack of creative destruction and innovation is not the only reason why there are severe limits to growth under extractive institutions. The history of…](https://sms4smile.com/quotes/daron-acemo-lu/lack-of-creative-destruction-and-innovation-is-not-the-only-reason/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“As with France, an important consequence of the British Industrial Revolution for China and Japan was military vulnerability. China was humbled by British sea…](https://sms4smile.com/quotes/daron-acemo-lu/as-with-france-an-important-consequence-of-the-british-industrial/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“Though the extractive institutions that the Mayas created produced sufficient wealth for the cities to flourish and the elite to become wealthy and generate…](https://sms4smile.com/quotes/daron-acemo-lu/though-the-extractive-institutions-that-the-mayas-created-produced/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“THERE ARE HUGE DIFFERENCES in living standards around the world. Even the poorest citizens of the United States have incomes and access to health…](https://sms4smile.com/quotes/daron-acemo-lu/there-are-huge-differences-in-living-standards-around-the-world-even/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“The Maya’s economy was based on extensive occupational specialization, with skilled potters, weavers, woodworkers, and tool and ornament makers. They also traded obsidian, jaguar…](https://sms4smile.com/quotes/daron-acemo-lu/the-maya-s-economy-was-based-on-extensive-occupational-specialization/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“In the same way, current Chinese growth has nothing to do with Chinese values or changes in Chinese culture; it results from a process…](https://sms4smile.com/quotes/daron-acemo-lu/in-the-same-way-current-chinese-growth-has-nothing-to-do-with-chinese/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“NATIONS FAIL TODAY because their extractive economic institutions do not create the incentives needed for people to save, invest, and innovate. Extractive political institutions…](https://sms4smile.com/quotes/daron-acemo-lu/nations-fail-today-because-their-extractive-economic-institutions-do/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“The geography hypothesis claims that the great divide between rich and poor countries is created by geographical differences. Many poor countries, such as those…](https://sms4smile.com/quotes/daron-acemo-lu/the-geography-hypothesis-claims-that-the-great-divide-between-rich/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“Politics is the process by which a society chooses the rules that will govern it.”](https://sms4smile.com/quotes/daron-acemo-lu/politics-is-the-process-by-which-a-society-chooses-the-rules-that/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“The pattern of vicious circle depicted by the transition between Haile Selassie and Mengistu, or between the British colonial governors of Sierra Leone and…](https://sms4smile.com/quotes/daron-acemo-lu/the-pattern-of-vicious-circle-depicted-by-the-transition-between/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“NATIONS FAIL TODAY because their extractive economic institutions do not create the incentives needed for people to save, invest, and innovate. Extractive political institutions…](https://sms4smile.com/quotes/daron-acemo-lu/nations-fail-today-because-their-extractive-economic-institutions-do-2/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [Inclusive economic institutions require secure property rights and economic opportunities not just for the elite but for a broad cross-section of society.](https://sms4smile.com/quotes/daron-acemo-lu/inclusive-economic-institutions-require-secure-property-rights-and/) [Daron Acemoglu](https://sms4smile.com/quotes/author/daron-acemo-lu/) > [“Inequality in the modern world largely results from the uneven dissemination and adoption of technologies,”](https://sms4smile.com/quotes/daron-acemo-lu/inequality-in-the-modern-world-largely-results-from-the-uneven/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) ```json { "@context": "https://schema.org", "@graph": [ { "@type": "ItemList", "@id": 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Extractive political institutions support these economic institutions by cementing the power of those who benefit from the extraction.”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/nations-fail-today-because-their-extractive-economic-institutions-do-2/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/f0b/daron-acemo-lu-4415_failure_nations-fail-today-because-their-extract_311353.jpg", "contentUrl": "https://sms4smile.com/quotes/i/f0b/daron-acemo-lu-4415_failure_nations-fail-today-because-their-extract_311353.jpg", "url": "https://sms4smile.com/quotes/i/f0b/daron-acemo-lu-4415_failure_nations-fail-today-because-their-extract_311353.jpg", "width": 1080, "height": 1080, "caption": "“NATIONS FAIL TODAY because their extractive economic institutions do not create the incentives needed for…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 7, "item": { "@type": "Quotation", "text": "“THE CONTRAST OF South and North Korea, and of the United States and Latin America, illustrates a general principle. Inclusive economic institutions foster economic activity, productivity growth, and economic prosperity. Secure private property rights are central, since only those with such rights will be willing to invest and increase productivity. A businessman who expects his output to be stolen, expropriated, or entirely taxed away will have little incentive to work, let alone any incentive to undertake investments and innovations. But such rights must exist for the majority of people in society. In”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/the-contrast-of-south-and-north-korea-and-of-the-united-states-and/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/ade/daron-acemo-lu-4415_economic-prosperity_the-contrast-of-south-and-north-korea-an_3008065.jpg", "contentUrl": "https://sms4smile.com/quotes/i/ade/daron-acemo-lu-4415_economic-prosperity_the-contrast-of-south-and-north-korea-an_3008065.jpg", "url": "https://sms4smile.com/quotes/i/ade/daron-acemo-lu-4415_economic-prosperity_the-contrast-of-south-and-north-korea-an_3008065.jpg", "width": 1080, "height": 1080, "caption": "“THE CONTRAST OF South and North Korea, and of the United States and Latin America, illustrates a general…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 8, "item": { "@type": "Quotation", "text": "“Inclusive economic institutions, such as those in South Korea or in the United States, are those that allow and encourage participation by the great mass of people in economic activities that make best use of their talents and skills and that enable individuals to make the choices they wish. To be inclusive, economic institutions must feature secure private property, an unbiased system of law, and a provision of public services that provides a level playing field in which people can exchange and contract; it also must permit the entry of new businesses and allow people to choose their careers.”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/inclusive-economic-institutions-such-as-those-in-south-korea-or-in/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/e12/daron-acemo-lu-4415_economics_inclusive-economic-institutions-such-as_665136.jpg", "contentUrl": "https://sms4smile.com/quotes/i/e12/daron-acemo-lu-4415_economics_inclusive-economic-institutions-such-as_665136.jpg", "url": "https://sms4smile.com/quotes/i/e12/daron-acemo-lu-4415_economics_inclusive-economic-institutions-such-as_665136.jpg", "width": 1080, "height": 1080, "caption": "“Inclusive economic institutions, such as those in South Korea or in the United States, are those that allow…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 9, "item": { "@type": "Quotation", "text": "“during the critical juncture created by the Industrial Revolution, many nations missed the boat and failed to take advantage of the spread of industry. Either they had absolutist political and extractive economic institutions, as in the Ottoman Empire, or they lacked political centralization, as in Somalia. A”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/during-the-critical-juncture-created-by-the-industrial-revolution/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/7b5/daron-acemo-lu-4415_industrial-revolutio_during-the-critical-juncture-created-by_1177325.jpg", "contentUrl": "https://sms4smile.com/quotes/i/7b5/daron-acemo-lu-4415_industrial-revolutio_during-the-critical-juncture-created-by_1177325.jpg", "url": "https://sms4smile.com/quotes/i/7b5/daron-acemo-lu-4415_industrial-revolutio_during-the-critical-juncture-created-by_1177325.jpg", "width": 1080, "height": 1080, "caption": "“during the critical juncture created by the Industrial Revolution, many nations missed the boat and failed…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 10, "item": { "@type": "Quotation", "text": "“The ability of economic institutions to harness the potential of inclusive markets, encourage technological innovation, invest in people, and mobilize the talents and skills of a large number of individuals is critical for economic growth. Explaining why so many economic institutions fail to meet these simple objectives is the central theme of this book. E”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/the-ability-of-economic-institutions-to-harness-the-potential-of/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/bcf/daron-acemo-lu-4415_economic-growth_the-ability-of-economic-institutions-to_1867333.jpg", "contentUrl": "https://sms4smile.com/quotes/i/bcf/daron-acemo-lu-4415_economic-growth_the-ability-of-economic-institutions-to_1867333.jpg", "url": "https://sms4smile.com/quotes/i/bcf/daron-acemo-lu-4415_economic-growth_the-ability-of-economic-institutions-to_1867333.jpg", "width": 1080, "height": 1080, "caption": "“The ability of economic institutions to harness the potential of inclusive markets, encourage technological…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 11, "item": { "@type": "Quotation", "text": "“Inclusive economic institutions also pave the way for two other engines of prosperity: technology and education. Sustained economic growth is almost always accompanied by technological improvements that enable people (labor), land, and existing capital (buildings, existing machines, and so on) to become more productive.”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/inclusive-economic-institutions-also-pave-the-way-for-two-other/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/01f/daron-acemo-lu-4415_change_inclusive-economic-institutions-also-pav_666351.jpg", "contentUrl": "https://sms4smile.com/quotes/i/01f/daron-acemo-lu-4415_change_inclusive-economic-institutions-also-pav_666351.jpg", "url": "https://sms4smile.com/quotes/i/01f/daron-acemo-lu-4415_change_inclusive-economic-institutions-also-pav_666351.jpg", "width": 1080, "height": 1080, "caption": "“Inclusive economic institutions also pave the way for two other engines of prosperity: technology and…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 12, "item": { "@type": "Quotation", "text": "“Economic institutions shape economic incentives: the incentives to become educated, to save and invest, to innovate and adopt new technologies, and so on. It is the political process that determines what economic institutions people live under, and it is the political institutions that determine how this process works.”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/economic-institutions-shape-economic-incentives-the-incentives-to/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/b35/daron-acemo-lu-4415_economics_economic-institutions-shape-economic-inc_1830476.jpg", "contentUrl": "https://sms4smile.com/quotes/i/b35/daron-acemo-lu-4415_economics_economic-institutions-shape-economic-inc_1830476.jpg", "url": "https://sms4smile.com/quotes/i/b35/daron-acemo-lu-4415_economics_economic-institutions-shape-economic-inc_1830476.jpg", "width": 1080, "height": 1080, "caption": "“Economic institutions shape economic incentives: the incentives to become educated, to save and invest, to…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 13, "item": { "@type": "Quotation", "text": "“The Industrial Revolution started and made its biggest strides in England because of her uniquely inclusive economic institutions. These in turn were built on foundations laid by the inclusive political institutions brought about by the Glorious Revolution. It was the Glorious Revolution that strengthened and rationalized property rights, improved financial markets, undermined state-sanctioned monopolies in foreign trade, and removed the barriers to the expansion of industry. It was the Glorious Revolution that made the political system open and responsive to the economic needs and aspirations of society. These inclusive economic institutions gave men of talent and vision such as James Watt the opportunity and incentive to develop their skills and ideas and influence the system in ways that benefited them and the nation. Naturally these men, once they had become successful, had the same urges as any other person. They wanted to block others from entering their businesses and competing against them and feared the process of creative destruction that might put them out of business, as they had previously bankrupted others.”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/the-industrial-revolution-started-and-made-its-biggest-strides-in/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/c85/daron-acemo-lu-4415_industrial-revolutio_the-industrial-revolution-started-and-ma_1517850.jpg", "contentUrl": "https://sms4smile.com/quotes/i/c85/daron-acemo-lu-4415_industrial-revolutio_the-industrial-revolution-started-and-ma_1517850.jpg", "url": "https://sms4smile.com/quotes/i/c85/daron-acemo-lu-4415_industrial-revolutio_the-industrial-revolution-started-and-ma_1517850.jpg", "width": 1080, "height": 1080, "caption": "“The Industrial Revolution started and made its biggest strides in England because of her uniquely inclusive…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 14, "item": { "@type": "Quotation", "text": "“Extractive institutions are so common in history because they have a powerful logic: they can generate some limited prosperity while at the same time distributing it into the hands of a small elite. For this growth to happen, there must be political centralization. Once this is in place, the state—or the elite controlling the state—typically has incentives to invest and generate wealth, encourage others to invest so that the state can extract resources from them, and even mimic some of the processes that would normally be set in motion by inclusive economic institutions and markets. In the Caribbean plantation economies, extractive institutions took the form of the elite using coercion to force slaves to produce sugar. In the Soviet Union, they took the form of the Communist Party reallocating resources from agriculture to industry and structuring some sort of incentives for managers and workers. As we have seen,”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/extractive-institutions-are-so-common-in-history-because-they-have-a/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/ae5/daron-acemo-lu-4415_economics_extractive-institutions-are-so-common-in_1976556.jpg", "contentUrl": "https://sms4smile.com/quotes/i/ae5/daron-acemo-lu-4415_economics_extractive-institutions-are-so-common-in_1976556.jpg", "url": "https://sms4smile.com/quotes/i/ae5/daron-acemo-lu-4415_economics_extractive-institutions-are-so-common-in_1976556.jpg", "width": 1080, "height": 1080, "caption": "“Extractive institutions are so common in history because they have a powerful logic: they can generate some…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 15, "item": { "@type": "Quotation", "text": "“Finally, when growth comes under extractive political institutions but where economic institutions have inclusive aspects, as they did in South Korea, there is always the danger that economic institutions become more extractive and growth stops. Those controlling political power will eventually find it more beneficial to use their power to limit competition, to increase their share of the pie, or even to steal and loot from others rather than support economic progress. The distribution and ability to exercise power will ultimately undermine the very foundations of economic prosperity, unless political institutions are transformed from extractive to inclusive.”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/finally-when-growth-comes-under-extractive-political-institutions-but/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/281/daron-acemo-lu-4415_political-power_finally-when-growth-comes-under-extracti_2435069.jpg", "contentUrl": "https://sms4smile.com/quotes/i/281/daron-acemo-lu-4415_political-power_finally-when-growth-comes-under-extracti_2435069.jpg", "url": "https://sms4smile.com/quotes/i/281/daron-acemo-lu-4415_political-power_finally-when-growth-comes-under-extracti_2435069.jpg", "width": 1080, "height": 1080, "caption": "“Finally, when growth comes under extractive political institutions but where economic institutions have…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 16, "item": { "@type": "Quotation", "text": "“NATIONS FAIL TODAY because their extractive economic institutions do not create the incentives needed for people to save, invest, and innovate. Extractive political institutions support these economic institutions by cementing the power of those who benefit from the extraction. Extractive economic and political institutions, though their details vary under different circumstances, are always at the root of this failure. In many cases, for example, as we will see in Argentina, Colombia, and Egypt, this failure takes the form of lack of sufficient economic activity, because the politicians are just too happy to extract resources or quash any type of independent economic activity that threatens themselves and the economic elites. In some extreme cases, as in Zimbabwe and Sierra Leone, which we discuss next, extractive institutions pave the way for complete state failure, destroying not only law and order but also even the most basic economic incentives. The result is economic stagnation and—as the recent history of Angola, Cameroon, Chad, the Democratic Republic of Congo, Haiti, Liberia, Nepal, Sierra Leone, Sudan, and Zimbabwe illustrates—civil wars, mass displacements, famines, and epidemics, making many of these countries poorer today than they were in the 1960s. A”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/nations-fail-today-because-their-extractive-economic-institutions-do/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/382/daron-acemo-lu-4415_civil-war_nations-fail-today-because-their-extract_231202.jpg", "contentUrl": "https://sms4smile.com/quotes/i/382/daron-acemo-lu-4415_civil-war_nations-fail-today-because-their-extract_231202.jpg", "url": "https://sms4smile.com/quotes/i/382/daron-acemo-lu-4415_civil-war_nations-fail-today-because-their-extract_231202.jpg", "width": 1080, "height": 1080, "caption": "“NATIONS FAIL TODAY because their extractive economic institutions do not create the incentives needed for…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } } ] }, { "@type": "CollectionPage", "@id": "https://sms4smile.com/quotes/about/economic-institutions/daron-acemo-lu/#webpage", "url": "https://sms4smile.com/quotes/about/economic-institutions/daron-acemo-lu/", "name": "Economic Institutions Quotes by Daron Acemoğlu", "isPartOf": { "@id": "https://sms4smile.com/quotes/#website" }, "mainEntity": { "@id": "https://sms4smile.com/quotes/about/economic-institutions/daron-acemo-lu/#itemlist" }, "primaryImageOfPage": { "@id": "https://sms4smile.com/quotes/i/7e0/daron-acemo-lu-4415_quote_we-call-such-institutions-which-have-opp_1069746.jpg" }, "description": "16 Economic Institutions quotes by Daron Acemoğlu. Plus more from Daron Acemoğlu and more Economic Institutions sayings from other authors.", "breadcrumb": { "@id": "https://sms4smile.com/quotes/about/economic-institutions/daron-acemo-lu/#breadcrumb" } }, { "@type": "BreadcrumbList", "@id": "https://sms4smile.com/quotes/about/economic-institutions/daron-acemo-lu/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://sms4smile.com/" }, { "@type": "ListItem", "position": 2, "name": "Quotes", "item": "https://sms4smile.com/quotes/" }, { "@type": "ListItem", "position": 3, "name": "Topics", "item": "https://sms4smile.com/quotes/categories/" }, { "@type": "ListItem", "position": 4, "name": "Economic Institutions", "item": "https://sms4smile.com/quotes/about/economic-institutions/" }, { "@type": "ListItem", "position": 5, "name": "Daron Acemoğlu", "item": "https://sms4smile.com/quotes/about/economic-institutions/daron-acemo-lu/" } ] }, { "@type": "WebSite", "@id": "https://sms4smile.com/quotes/#website", "name": "SMS4Smile Quotes", "url": "https://sms4smile.com/quotes/", "publisher": { "@id": "https://sms4smile.com/quotes/#organization" } }, { "@type": "Organization", "@id": "https://sms4smile.com/quotes/#organization", "name": "SMS4Smile Quotes", "url": "https://sms4smile.com/quotes/", "logo": { "@type": "ImageObject", "url": "https://sms4smile.com/quotes/wp-content/themes/sq/assets/icons/icon-512.png", "width": 512, "height": 512 } } ] } ```