--- title: "Meaning & Key Takeaway of: The solution to the economic and…" description: "\"“The solution to the economic and political failure of nations today is to transform their extractive institutions toward inclusive ones. The vicious c..." image: "https://sms4smile.com/quotes/i/8b1/daron-acemo-lu-4415_civil-war_the-solution-to-the-economic-and-politic_2498228.jpg" --- # The solution to the economic and political failure of… ![“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…” quote by Daron Acemoğlu](https://sms4smile.com/quotes/i/8b1/daron-acemo-lu-4415_civil-war_the-solution-to-the-economic-and-politic_2498228.jpg) [Download](https://sms4smile.com/quotes/i/8b1/daron-acemo-lu-4415_civil-war_the-solution-to-the-economic-and-politic_2498228.jpg) [Open image](https://sms4smile.com/quotes/i/8b1/daron-acemo-lu-4415_civil-war_the-solution-to-the-economic-and-politic_2498228.jpg) > ““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.”” [Daron Acemoğlu](https://sms4smile.com/quotes/author/daron-acemo-lu/) ## About This Quote This interpretation was drafted with AI assistance. It is one reading of the quote, not the author's own explanation. Transforming extractive institutions into inclusive ones can break cycles of oppression, though it requires broad coalitions, historical contingencies, and luck. **In simple terms:** Inclusive institutions can end oppressive cycles. Key Takeaway Build broad, inclusive coalitions. Themes politics institutional change history economics Mood analytical optimistic Type theoretical policy-oriented When to use this quote - policy design - nation building - social movements - historical analysis Key Concepts inclusive governance institutional reform Questions to Reflect On - What conditions enable institutional transformation? - How can societies sustain inclusive reforms? A Different Perspective Success depends on unpredictable factors and elite resistance. ★ ★ ★ ★ ★ No ratings yet [1688 Struggle](https://sms4smile.com/quotes/about/1688-struggle-1034797/) [Civil war](https://sms4smile.com/quotes/about/civil-war/) [Different points of view](https://sms4smile.com/quotes/about/different-points-of-view/) [Extractive Institutions](https://sms4smile.com/quotes/about/extractive-institutions-891273/) [Failure](https://sms4smile.com/quotes/about/failure/) [Law Oligarchy](https://sms4smile.com/quotes/about/law-oligarchy-1034799/) [Next chapter](https://sms4smile.com/quotes/about/next-chapter/) [Oliver Cromwell](https://sms4smile.com/quotes/about/oliver-cromwell/) [Politics](https://sms4smile.com/quotes/about/politics/) [Revolution](https://sms4smile.com/quotes/about/revolution/) [Revolution 1688](https://sms4smile.com/quotes/about/revolution-1688-976487/) [Sierra leone](https://sms4smile.com/quotes/about/sierra-leone/) [Transform Institutions](https://sms4smile.com/quotes/about/transform-institutions-1034798/) [War](https://sms4smile.com/quotes/about/war/) ## Related quotes > [“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/) > [Talking can transform minds, which can transform behaviors, which can transform institutions.](https://sms4smile.com/quotes/sheryl-sandberg/talking-can-transform-minds-which-can-transform-behaviors-which-can/) [Sheryl Sandberg](https://sms4smile.com/quotes/author/sheryl-sandberg/) > [“Lack of creative destruction and innovation is not the only reason why there are severe limits to growth under extractive institutions. 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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. 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