The Nobel memorial prize in economics has been awarded to three U.S.-based academics who studied why some countries are rich and others poor and have documented that freer, open societies are more likely to prosper.
The work by Daron Acemoglu, Simon Johnson and James A. Robinson “demonstrated the importance of societal institutions for a country’s prosperity,” the Nobel committee of the Royal Swedish Academy of Sciences said at the announcement in Stockholm.
Why are some countries richer than others?
In countries that were already rich, or were places where European settlers did not survive well because of illnesses or the climate, “colonial institutions were extractive”, Coyle says. “In contrast, in countries that were poorer to start with or had better climates, Europeans instead built more inclusive institutions similar to their own countries.”
“The laureates demonstrated that the places that were, relatively speaking, the richest at their time of colonization are now among the poorest,” the Royal Swedish Academy of Sciences said in a statement.
“When Europeans colonised large parts of the world, the existing institutions sometimes changed dramatically, but not in the same way everywhere. In some colonies, the purpose was to exploit the indigenous population and extract natural resources to benefit the colonizers. In other cases, the colonisers built inclusive political and economic systems.”
There is also a very good read on Dr. Acemoglu's approach to solve climate change: