In case you weren’t convinced that Nobel Prizes are just another fake Clown World propaganda prize, consider who was awarded the most recent not-Nobel for Economics:
Why Nations Fail was shortlisted for the Financial Times and Goldman Sachs business book of the year award 2012.
I read the book shortly after the publication since the authors spent quite some time analyzing China and contrasting with the US. I found they had very little original insights and merely recycled western stereotype caricature of China while their praise for the US somewhat unwarranted. I soon forgot the book.
If this is just another book that doesn’t age well, no one would have noticed, and I won’t be writing about it. After all, it’s par for the course for “social science” books to echo the ethos of the time when they were published. They are often dead wrong and people move on to the next shiny object.
However, 12 years after the publication of the book, the esteemed Nobel economics committee decided to award the authors the Nobel prize for this work.
So I re-read the book and did some research on what others thought about it when it first came out. I found my original impression of the book was validated and there were serious critiques, most presciently from Ron Unz of Unz Review. Let me dwell into this.
Robinson and Acemoglu analyzed the economic institutions and performance of numerous countries in the book. As the major economies of the world, China and the US were given special attention.
The authors used China and the US as the examples of what they characterized as “extractive” vs. “inclusive” systems.
They argued that China was destined to fail as it had an extractive economic system run by a venal, self serving elite. On the other hand, the US would win with its inclusive, democratic system run by rule of law, democratic check and balances, and broad citizen participation in decision making.
The Chinese system was described as closed from competition, incapable of innovation, and run by corrupt authoritarian leaders. Robinson and Acemoglu contended China’s economic performance to date (at the 2012 publication date), while impressive, was unsustainable and would falter.
They stated the US economic system thrived on creative destruction as the inclusive institutions encourage competition, reward innovation, and provide opportunities for new entrants into the market. The authors argued that the U.S.’s success was not due to geography, culture, or natural resources, but rather its inclusive institutions and an elite that work to advance the interests of the population.
13 years after the publication of the book, you have to wonder what planet Robinson and Acemoglu lived on when they wrote the book and what kind of ideological blindness has led the Nobel economics committee to award the prestigious prize to them.
Ironically, the only reason nations fail that is actually related to economics is if they are dumb enough to buy into free trade, and worse, open immigration. Women’s right and educating women are much more serious problems, as the collapsing birth rates everywhere from Japan and South Korea to Germany and Italy suffice to demonstrate.
But the thesis presented by Messrs. Daron Acemoglu, James Robinson, and Simon Johnson is so obviously irrelevant, especially in light of the fact that they couldn’t even correctly identify which nations are presently crippled by an “extractive system, run by a self-serving ruling elite”.
Then again, the fact that Paul Krugman, of all people, was awarded one of these prizes is sufficient to prove its worthlessness. That’s just embarrassing. If these awards were legitimate, Ian Fletcher, Steve Keen, and your favorite dark lord would have all won at least one.
