--- title: "12 Extractive Institutions Quotes By Daron Acemoğlu" description: "12 Extractive Institutions quotes by Daron Acemoğlu. Plus more from Daron Acemoğlu and more Extractive 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) > [“Because elites dominating extractive institutions fear creative destruction, they will resist it, and any growth that germinates under extractive institutions will be…](https://sms4smile.com/quotes/daron-acemo-lu/because-elites-dominating-extractive-institutions-fear-creative/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/089/daron-acemo-lu-4415_quote_because-elites-dominating-extractive-ins_2179158.jpg) > [“The most important lesson is that extractive institutions cannot generate sustained technological change for two reasons: the lack of economic incentives and…](https://sms4smile.com/quotes/daron-acemo-lu/the-most-important-lesson-is-that-extractive-institutions-cannot/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/7af/daron-acemo-lu-4415_technology_the-most-important-lesson-is-that-extrac_2139132.jpg) > [“While part of the appeal of authoritarian growth comes as a reaction to the Washington consensus, perhaps its greater charm—certainly to the…](https://sms4smile.com/quotes/daron-acemo-lu/while-part-of-the-appeal-of-authoritarian-growth-comes-as-a-reaction/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/6f8/daron-acemo-lu-4415_power_while-part-of-the-appeal-of-authoritaria_1674178.jpg) > [“BOTSWANA, CHINA, and the U.S. South, just like the Glorious Revolution in England, the French Revolution, and the Meiji Restoration in Japan,…](https://sms4smile.com/quotes/daron-acemo-lu/botswana-china-and-the-u-s-south-just-like-the-glorious-revolution-in/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/eed/daron-acemo-lu-4415_french-revolution_botswana-china-and-the-u-s-south-just-li_2803658.jpg) > [“Though the extractive institutions that the Mayas created produced sufficient wealth for the cities to flourish and the elite to become wealthy…](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/) [Image](https://sms4smile.com/quotes/i/d4c/daron-acemo-lu-4415_art_though-the-extractive-institutions-that_88927.jpg) > [“The solution to the economic and political failure of nations today is to transform their extractive institutions toward inclusive ones. The vicious…](https://sms4smile.com/quotes/daron-acemo-lu/the-solution-to-the-economic-and-political-failure-of-nations-today/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/8b1/daron-acemo-lu-4415_civil-war_the-solution-to-the-economic-and-politic_2498228.jpg) > [“Lack of creative destruction and innovation is not the only reason why there are severe limits to growth under extractive institutions. The…](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/) [Image](https://sms4smile.com/quotes/i/feb/daron-acemo-lu-4415_law-and-order_lack-of-creative-destruction-and-innovat_69791.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) > [“The synergies between extractive economic and political institutions create a vicious circle, where extractive institutions, once in place, tend to persist. Similarly,…](https://sms4smile.com/quotes/daron-acemo-lu/the-synergies-between-extractive-economic-and-political-institutions/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/03e/daron-acemo-lu-4415_around-the-world_the-synergies-between-extractive-economi_1812039.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) > [“World inequality today exists because during the nineteenth and twentieth centuries some nations were able to take advantage of the Industrial Revolution…](https://sms4smile.com/quotes/daron-acemo-lu/world-inequality-today-exists-because-during-the-nineteenth-and/) [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) [Image](https://sms4smile.com/quotes/i/921/daron-acemo-lu-4415_around-the-world_world-inequality-today-exists-because-du_1075838.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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"url": "https://sms4smile.com/quotes/daron-acemo-lu/the-most-important-lesson-is-that-extractive-institutions-cannot/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/7af/daron-acemo-lu-4415_technology_the-most-important-lesson-is-that-extrac_2139132.jpg", "contentUrl": "https://sms4smile.com/quotes/i/7af/daron-acemo-lu-4415_technology_the-most-important-lesson-is-that-extrac_2139132.jpg", "url": "https://sms4smile.com/quotes/i/7af/daron-acemo-lu-4415_technology_the-most-important-lesson-is-that-extrac_2139132.jpg", "width": 1080, "height": 1080, "caption": "“The most important lesson is that extractive institutions cannot generate sustained technological change for…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 4, "item": { "@type": "Quotation", "text": "“While part of the appeal of authoritarian growth comes as a reaction to the Washington consensus, perhaps its greater charm—certainly to the rulers presiding over extractive institutions—is that it gives them free rein in maintaining and even strengthening their hold on power and legitimizes their extraction.”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/while-part-of-the-appeal-of-authoritarian-growth-comes-as-a-reaction/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/6f8/daron-acemo-lu-4415_power_while-part-of-the-appeal-of-authoritaria_1674178.jpg", "contentUrl": "https://sms4smile.com/quotes/i/6f8/daron-acemo-lu-4415_power_while-part-of-the-appeal-of-authoritaria_1674178.jpg", "url": "https://sms4smile.com/quotes/i/6f8/daron-acemo-lu-4415_power_while-part-of-the-appeal-of-authoritaria_1674178.jpg", "width": 1080, "height": 1080, "caption": "“While part of the appeal of authoritarian growth comes as a reaction to the Washington consensus, perhaps…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 5, "item": { "@type": "Quotation", "text": "“BOTSWANA, CHINA, and the U.S. South, just like the Glorious Revolution in England, the French Revolution, and the Meiji Restoration in Japan, are vivid illustrations that history is not destiny. Despite the vicious circle, extractive institutions can be replaced by inclusive ones. But it is neither automatic nor easy. A confluence of factors, in particular a critical juncture coupled with a broad coalition of those pushing for reform or other propitious existing institutions, is often necessary for a nation to make strides toward more inclusive institutions. In addition some luck is key, because history always unfolds in a contingent way.”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/botswana-china-and-the-u-s-south-just-like-the-glorious-revolution-in/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/eed/daron-acemo-lu-4415_french-revolution_botswana-china-and-the-u-s-south-just-li_2803658.jpg", "contentUrl": "https://sms4smile.com/quotes/i/eed/daron-acemo-lu-4415_french-revolution_botswana-china-and-the-u-s-south-just-li_2803658.jpg", "url": "https://sms4smile.com/quotes/i/eed/daron-acemo-lu-4415_french-revolution_botswana-china-and-the-u-s-south-just-li_2803658.jpg", "width": 1080, "height": 1080, "caption": "“BOTSWANA, CHINA, and the U.S. South, just like the Glorious Revolution in England, the French Revolution…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 6, "item": { "@type": "Quotation", "text": "“Though the extractive institutions that the Mayas created produced sufficient wealth for the cities to flourish and the elite to become wealthy and generate great art and monumental buildings, the system was not stable. The extractive institutions upon which this narrow elite ruled created extensive inequality, and thus the potential for infighting between those who could benefit from the wealth extracted from the people. This conflict ultimately led to the undoing of the Maya civilization. W”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/though-the-extractive-institutions-that-the-mayas-created-produced/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/d4c/daron-acemo-lu-4415_art_though-the-extractive-institutions-that_88927.jpg", "contentUrl": "https://sms4smile.com/quotes/i/d4c/daron-acemo-lu-4415_art_though-the-extractive-institutions-that_88927.jpg", "url": "https://sms4smile.com/quotes/i/d4c/daron-acemo-lu-4415_art_though-the-extractive-institutions-that_88927.jpg", "width": 1080, "height": 1080, "caption": "“Though the extractive institutions that the Mayas created produced sufficient wealth for the cities to…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 7, "item": { "@type": "Quotation", "text": "“The solution to the economic and political failure of nations today is to transform their extractive institutions toward inclusive ones. The vicious circle means that this is not easy. But it is not impossible, and the iron law of oligarchy is not inevitable. Either some preexisting inclusive elements in institutions, or the presence of broad coalitions leading the fight against the existing regime, or just the contingent nature of history, can break vicious circles. Just like the civil war in Sierra Leone, the Glorious Revolution in 1688 was a struggle for power. But it was a struggle of a very different nature than the civil war in Sierra Leone. Conceivably some in Parliament fighting to remove James II in the wake of the Glorious Revolution imagined themselves playing the role of the new absolutist, as Oliver Cromwell did after the English Civil War. But the fact that Parliament was already powerful and made up of a broad coalition consisting of different economic interests and different points of view made the iron law of oligarchy less likely to apply in 1688. And it was helped by the fact that luck was on the side of Parliament against James II. In the next chapter, we will see other examples of countries that have managed to break the mold and transform their institutions for the better, even after a long history of extractive institutions.”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/the-solution-to-the-economic-and-political-failure-of-nations-today/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/8b1/daron-acemo-lu-4415_civil-war_the-solution-to-the-economic-and-politic_2498228.jpg", "contentUrl": "https://sms4smile.com/quotes/i/8b1/daron-acemo-lu-4415_civil-war_the-solution-to-the-economic-and-politic_2498228.jpg", "url": "https://sms4smile.com/quotes/i/8b1/daron-acemo-lu-4415_civil-war_the-solution-to-the-economic-and-politic_2498228.jpg", "width": 1080, "height": 1080, "caption": "“The solution to the economic and political failure of nations today is to transform their extractive…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 8, "item": { "@type": "Quotation", "text": "“Lack of creative destruction and innovation is not the only reason why there are severe limits to growth under extractive institutions. The history of the Maya city-states illustrates a more ominous and, alas, more common end, again implied by the internal logic of extractive institutions. As these institutions create significant gains for the elite, there will be strong incentives for others to fight to replace the current elite. Infighting and instability are thus inherent features of extractive institutions, and they not only create further inefficiencies but also often reverse any political centralization, sometimes even leading to the total breakdown of law and order and descent into chaos, as the Maya city-states experienced following their relative success during their Classical Era. Though”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/lack-of-creative-destruction-and-innovation-is-not-the-only-reason/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/feb/daron-acemo-lu-4415_law-and-order_lack-of-creative-destruction-and-innovat_69791.jpg", "contentUrl": "https://sms4smile.com/quotes/i/feb/daron-acemo-lu-4415_law-and-order_lack-of-creative-destruction-and-innovat_69791.jpg", "url": "https://sms4smile.com/quotes/i/feb/daron-acemo-lu-4415_law-and-order_lack-of-creative-destruction-and-innovat_69791.jpg", "width": 1080, "height": 1080, "caption": "“Lack of creative destruction and innovation is not the only reason why there are severe limits to growth…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 9, "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": "ListItem", "position": 10, "item": { "@type": "Quotation", "text": "“The synergies between extractive economic and political institutions create a vicious circle, where extractive institutions, once in place, tend to persist. Similarly, there is a virtuous circle associated with inclusive economic and political institutions. But neither the vicious nor the virtuous circle is absolute. In fact, some nations live under inclusive institutions today because, though extractive institutions have been the norm in history, some societies have been able to break the mold and transition toward inclusive institutions. Our explanation for these transitions is historical, but not historically predetermined. Major institutional change, the requisite for major economic change, takes place as a result of the interaction between existing institutions and critical junctures. Critical junctures are major events that disrupt the existing political and economic balance in one or many societies, such as the Black Death, which killed possibly as much as half the population of most areas in Europe during the fourteenth century; the opening of Atlantic trade routes, which created enormous profit opportunities for many in Western Europe; and the Industrial Revolution, which offered the potential for rapid but also disruptive changes in the structure of economies around the world. Existing”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/the-synergies-between-extractive-economic-and-political-institutions/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/03e/daron-acemo-lu-4415_around-the-world_the-synergies-between-extractive-economi_1812039.jpg", "contentUrl": "https://sms4smile.com/quotes/i/03e/daron-acemo-lu-4415_around-the-world_the-synergies-between-extractive-economi_1812039.jpg", "url": "https://sms4smile.com/quotes/i/03e/daron-acemo-lu-4415_around-the-world_the-synergies-between-extractive-economi_1812039.jpg", "width": 1080, "height": 1080, "caption": "“The synergies between extractive economic and political institutions create a vicious circle, where…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } }, { "@type": "ListItem", "position": 11, "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": 12, "item": { "@type": "Quotation", "text": "“World inequality today exists because during the nineteenth and twentieth centuries some nations were able to take advantage of the Industrial Revolution and the technologies and methods of organization that it brought while others were unable to do so. Technological change is only one of the engines of prosperity, but it is perhaps the most critical one. The countries that did not take advantage of new technologies did not benefit from the other engines of prosperity, either. As we have shown in this and the previous chapter, this failure was due to their extractive institutions, either a consequence of the persistence of their absolutist regimes or because they lacked centralized states. But this chapter has also shown that in several instances the extractive institutions that underpinned the poverty of these nations were imposed, or at the very least further strengthened, by the very same process that fueled European growth: European commercial and colonial expansion. In fact, the profitability of European colonial empires was often built on the destruction of independent polities and indigenous economies around the world, or on the creation of extractive institutions essentially from the ground up, as in the Caribbean islands, where, following the almost total collapse of the native populations, Europeans imported African slaves and set up plantation systems. We”", "creator": { "@type": "Person", "name": "Daron Acemoğlu" }, "url": "https://sms4smile.com/quotes/daron-acemo-lu/world-inequality-today-exists-because-during-the-nineteenth-and/", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/921/daron-acemo-lu-4415_around-the-world_world-inequality-today-exists-because-du_1075838.jpg", "contentUrl": "https://sms4smile.com/quotes/i/921/daron-acemo-lu-4415_around-the-world_world-inequality-today-exists-because-du_1075838.jpg", "url": "https://sms4smile.com/quotes/i/921/daron-acemo-lu-4415_around-the-world_world-inequality-today-exists-because-du_1075838.jpg", "width": 1080, "height": 1080, "caption": "“World inequality today exists because during the nineteenth and twentieth centuries some nations were able…” — Daron Acemoğlu", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } } } ] }, { "@type": "CollectionPage", "@id": "https://sms4smile.com/quotes/about/extractive-institutions/daron-acemo-lu/#webpage", "url": "https://sms4smile.com/quotes/about/extractive-institutions/daron-acemo-lu/", "name": "Extractive Institutions Quotes by Daron Acemoğlu", "isPartOf": { "@id": "https://sms4smile.com/quotes/#website" }, "mainEntity": { "@id": "https://sms4smile.com/quotes/about/extractive-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": "12 Extractive Institutions quotes by Daron Acemoğlu. 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