When discussing poverty, it is difficult to pinpoint one simple reason that explains why poor countries remain poor. However, patterns may be drawn when looking at states’ history during European colonization. The notion that the existence or absence of European settlers largely shaped political institutions within states is supported by the two different institution types: representative institutions and extractive institutions. European settlers promoted their own wants through strong, representative institutions in colonized states. These states, such as the United States or Australia, are considered wealthy countries today, whereas today’s poor countries, including the Democratic Republic of Congo and Somalia, were colonized by European settlers as extractive institutions. In this paper, I will argue that, poor countries remain poor because the weak political institutions inherited by extractive states under colonial regimes persist, making it difficult to develop an appropriate relationship between the state and the market and degree of state intervention in the economy.
Even though colonial regimes eventually ended, the extractive state’s weak political institutions persisted for three main possibilities, according to Daron Acemoglu. The first possibility he and coauthors (2001) point to is the fact that “setting up institutions that place restrictions on government power and enforce property rights is costly” (1376). When new elites inherit extractive institutions,
Finally, European colonization also had a major political impact on different African communities. Prior to European colonialism, most African localities were stateless societies, where there was no main governmental body. Bohannan and Curtin in their passage explain how African “stateless organization all use kinship as the idiom of their system of sanctions” (1995:92), and additionally explain how “since there are two centers of power, no bureaucracy can arise” (1995:92), in stateless societies. This illustrates the difference between political structures in Africa and political structures in other parts of the world, including in Europe, as many other political structures have an increased presence of bureaucracy and government. Stateless societies in Africa started to diminish once Europeans started colonizing different African societies, as through the colonization process, European settlers imposed their political systems on different African communities. Bohannan and Curtin describe how “colonial officers tried to create some sort of a state organization and bureaucracy” (1995:94) in various African communities. Through this process, many previous forms of political organization in African societies were eliminated and newer forms emerged, and in many ways this was negative as many of these political systems did not favor African populations and put them at a disadvantage to European colonizers.
Imperialism -which is defined as the extension of a country's power and influence through colonisation, use of military force, or other similar means- occurred in history during two different time periods. The first bout of imperialism which is often referred to as “old” imperialism occurred between 1492 and 1800 while the “new” imperialism transpired between 1870 and 1914 (Scammell, 2004). Although the two movements had some similarities, there were several differences starting with the motivation behind each wave of imperialism and extending to the economic, ideological, and political differences (Bush, 2006). Those differences are the reasons why the two waves of imperialism are often classified as ‘Old’ and ‘New’. This essay will be briefly
However, we have already helped the poor nation’s enough and now they are relying on our efforts to help them live a healthy life (citation). Hardin argues that although earth might be seen as a spaceship analogy by the poor; that’s wrong because Earth doesn’t have a captain. Thus, the rich nations are represented as lifeboats and the poor nations are the swimmers at sea (citation). Hardin argues that although countries such as America have excess food supplies, it should not be given to the poor for the following reasons: the poor nations will not be motivated to stimulate their own economies, their population is growing faster than of a developed country (America’s population is doubling every 87 years while the poor countries are doubling
There are three main arguments believed to be the explanations for the existence and persistence of poverty. The first account is the Dependency-Based Explanation that puts the blame of poverty to the individual or to their cultural background. The Exclusion-Based Explanation and Structural-Based Explanation are the next two which establishes the society that condemns people to poverty.
The central thesis of AR in their book “Why Nations Fail” is that inclusive economic and political institutions drives economic growth and prosperity. Extractive institutions, on the other hand, where the majority work for the benefit of the few impedes and sometimes block economic prosperity. The other part to the theory is that inclusive economic and political institutions are often the outcome of conflict between elites resisting economic growth and political change and those working to put limits and constrains on the economic and political power of existing ruling elites.
What can be done can be done to bring countries in Africa out of poverty and get them to a status that allows them to compete with other global countries economically? A family is considered to be impoverished when they are making less than $1.90 U.S. dollars a day. Today seventy-five percent of the world’s poorest countries are located on the continent of Africa. Within Africa Sub Saharan Africa holds ten countries where majority of the population is living in poverty. Also in Sub Saharan Africa, 589 million people live without electricity. Around 80% of the continent’s population relies on biomass as their source of heat for cooking and cold climate. Out of a total one hundred, 37% of the people living without clean water live in Africa
Also, it is a controversial question whether the problems in the developing countries are caused by the developed world. Thomas Pogge (2008) has put forth a convincing argument. He has argued that the global economic order established by the developed countries significantly contributes to the poverty of many countries, by focusing on two aspects of it, namely “international resource privilege” and “international borrowing privilege”. These two rules stunt the growth of developing countries in many ways, the most notable of which is that they incentivize coup d’état. When authoritarian leaders obtain power through coup d’état, they do not see the need to improve the lives of ordinary people. I will examine Pogge’s argument in detail in the later part of this
The book by Daron Acemoglu and James A. Robinson Why Nations Fail: The Origins of Power, Prosperity, and Poverty discusses theories that explain the differences in standards of living and incomes among rich countries, such as the United States and the United Kingdom, and poorer countries in regions of South Asia and Central America. The basic theme of the book is that nations fail because of political institutions, rather than geography, culture, or economic policies. Acemoglu and Robinson theorize that political institutions can be divided into two types: extractive institutions where small groups of people take advantage of the population, and inclusive institutions when large groups of people are included in decisions made by the
Many influential thinkers view foreign aid as one of the best tools for eradicating poverty. However, my aim is to prove this belief wrong by demonstrating that if the capital is given to the wrong types of government then it works to further perpetuate inequalities. Nations thrive only when they establish inclusive governments—ones that promote free markets that permit citizens to not only spend freely but also to invest to promote the flow of capital. On the other hand, governments that use authority to consolidate power in the hand of only a few, such as one in Mexico, may show some economic growth but at the cost of the well-being of the majority.
In recent times we have seen the income distribution in many developed nations expand, meaning that the gap between rich and poor has grown. Coupled with this is the resultant degradation of economic and social mobility. This serves to show that they there is a tendency for those that are poor, to remain poor. There are a number of causal factors that seemingly predicate this fate of a poverty cycle. The issues that contribute to this range from the education and wellbeing of the individual, societal influences and values, their spending habits, their living conditions as well as their ability to access funding as a means of fuelling entrepreneurial endeavours.
Are poor countries somehow "different" than wealthy countries? Poor countries are different than wealthy countries in several aspects. Coming to terms with this realization may be somewhat troublesome for some of us that leave in wealthy countries like the U.S., where per capita Gross domestic product in 2009 was about $48,000, to get a handle on the way that around 2.5 billion individuals, or about a large portion of the total populace, live on $2 or less a day. About 1.4 billion live on under $1.25 a day. Craving, dinginess, and ailment are the standard in numerous countries of the world (Mankiw, 2012). Human capital and capital are restricted and conveyed unevenly all through the world and among individuals. Every individual and country has points of interest and impediments, resources and liabilities. What constitutes riches comprise of various merchandise and administrations for every person. When contrasting other poorer nations with wealthier nations there is greater imbalance and constrained assets. In any case, despite the fact that a nation might be poorer than another nation it might deliver products and enterprises at the most minimal relative cost.
The book ‘Why nations fail’ was written by Daron Acemoglu and James A. Robinson. The first author, an economics lecturer and was promoted to full professor in 2000. He is a member of the economic growth program of the Canadian Institute of Advanced Research. His interests and particularly to his audience are political economy where most of his works concentrate on political economy development with regards to the roles of institutions. The co-author also a professor at Harvard University, has studied economics at the London schools of economics, the university of Warwick and Yale University. He mostly concentrates on comparing economic and political development with particular interest in Latin America and Sub-Saharan counties. The two authors base the book on economics. The book is intended for a general, much wider audience although it specifically tends to appease to the economics student. The book attempts to offer crucial insight into political economic failure especially with regards to extractive states. It is important for the economic student and the general reader to understand their history so as to forge the future.
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According to the dictionary, colonialism may be defined as the policy or practice of acquiring full or partial political control over another country, occupy it settlers, and exploit it economically. Colonialism between the 1870s and 1900s had a massive impact on African communities. Therefore, I am studying effect of colonialism because I want to find out its impacts in order to understand the transformation it brought to the African continent based on our readings, films and class discussions. As present, the African continent continue to face serious economic, social and military challenges, even after attaining their political independence from European colonists. In this essay, I will demonstrate that colonialism broadly and adversely affected the socio-economic and military status on the African continent.
Lack of development in countries in the so-called `Third World' has many political and economical reasons. Historians explain the inadequacy of developing countries with the early imperialism and the resulting colonization of the South. Exploitation of mineral resources, deforestation, slavery, and the adaptation of foreign policies shaped the picture of today's suffering and struggling civilizations and natural rich continents. The omission of concessions and equal negotiations between dependency and supremacy give rise to the contrast of enormous resources and immense poverty in developing countries is. In the last years the outcry of justice and the emancipation of the Third World became louder throughout developing and industrialized