Institutions as a Fundamental Cause of Long-Run

“The malady of many underdeveloped economies can be diagnosed as a stable equilibrium level of per capita income at or close to subsistence requirements. Only a small percentage, if any, of the economy’s income is directed towards net investment. If the capital stock is accumulating, population is rising at a rate equally fast i.e. thus the amount of capital equipment per worker is not increasing. If economic growth is defined as rising per capita income, these economies are not growing. They are caught in a low-level equilibrium trap.”

the complete framework for governing in this type of society. It begins by stating that history is a

Economic Development: Growth is associated with structural, social change and change in the important institutions of the economy.

As we read and discuss the definition of politics, let’s also consider the consequences of political decisions upon our daily routines.

Throughout time, many countries suffered from unjust governments and unfair treatment. Some of them had a huge impact on the rest of the world, and on the course of history. Many of them succeeded, while a few of them failed to do so. Each one had a different approach on how to achieve their goals. Some of them decided to approach it violently, and others took it peacefully. Here are just three prime examples of different approaches towards government or political reforms.

Economic growth, put simply, is “an increase in the amount of goods and services produced per head of the population over a period of time”; development is inextricably linked with this economic growth. By utilising theories of economic growth and development we can see how the Chinese and Sub-Saharan African economies have emerged, but, more notably, we can use these to look at patterns from past and present to show their experience and the implications of this growth for the future.

Political – democracy – industrialists and power – communism – unions – empires (seeking new land and new resources)

The following section I discuss the following: form government, living standards, labor market conditions, the orderliness of leadership and succession, culture and demographic characteristics of the population, integration with international economic systems and security risk.

4. What is the current political system in the country? Have some major political changes taken place in the recently which has made a dramatic impact on the nation’s economy? Does the current political system help or hinder the economic development in that country? Do you foresee any political system changes in the future?

In this paper , 4 parts will be given. First of all, Income and assets inequality affects the economic growth. When the development level of the country is low, there is a negative relationship between income inequality and economic growth and bring a economic cost. On the contrary, the income inequality may facilitate the economic growth. Secondly, the benefit of income inequality is that people pay more attention to the welfare policy, epically education. Thirdly, the geographic context in the

The questions are raised as what and how the wealth is distributed or allocated among societies. Countries with similar average incomes can differ substantially when it comes to people’s quality of life such as social justice, access to education and health care, job opportunities, availability of clean air and safe drinking water, the threat of crime, freedom of speech, life expectancy, birth-death control, identity, culture, conservation, equal opportunities, environmental change. Development is important as it covers a wide range process involving cultural, economic, environmental, political, social and technological change of a country. Regarding goals and means of development, recent United Nations documents emphasize on human development measured by life expectancy, adult literacy, access to all three levels of education as well as people‘s average income which is a necessary condition of their freedom of choice. In other words, human development incorporates all aspects of individuals’ well -being from their health status to their economic and political freedom. The Human Development Report 1996 of UNDP focuses on development as the end and economic growth a

Eyeballing any cross sectional data on growth across countries shows that countries grow at different rates. Many theories try to explain this phenomenon with emphasis with capital accumulation being one of them. I will start by developing the standard neoclassical growth model as developed by Solow(1956)[1]. I will then proceed to discuss the extensions that have been made to this basic model in an attempt to better understand actual growth figures, for e.g. the standard neoclassical model cannot explain the magnitude of international differences in growth rates. Mankiw[2] points out that “the model can explain

In the Acemeglu, Johnson and Robinson article, “Institutions as a Fundamental Cause of Long Term Growth”, the authors emphasize how institutions are the main determinant of economic development because stronger institutions allow for more growth in education, security, and health. To observe whether strong institutions determine economic growth it is important to mention the characteristics of a strong institution that allows for fast growth. Strong institutions are able to enforce property rights, a fair judiciary, efficient bureaucracies, intellectual property rights, corporation government bankruptcy laws, and democracy (e.g. “(Lecture 13)”). Going in depth

According to the report of the Commission on Growth and Development, persistent, determined focus on inclusive long-term growth by governments is one of the ingredients of a successful growth strategy. Yet, there is limited analytic work integrating the literature on growth and productive employment. 5 The term ‘shared growth’ can be misunderstood as implying a focus on income distribution schemes, which is why inclusive growth is preferred. 6 Source: Growing Unequal? Income Distribution and Poverty in OECD Countries, OECD (2008).

He pointed out that different economic levels have their own requirements and they may not follow the same process of industrialization. Moreover, he raised the most influential theory related to late industrialization that the economically backward states may have rapider growth rate as they are late comers, and the national development process relied on the degree of economic backwardness. That is to say the more backward a country, the faster it will advance (ibid).