The Royal Swedish Academy of Sciences has decided to award the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2024 to Daron Acemoglu, Simon Johnson and James A. Robinson, all from the USA.
Key points
- This year’s laureates in the economic sciences have demonstrated the importance of societal institutions for a country’s prosperity.
- Societies with a poor rule of law and institutions that exploit the population do not generate growth or change for the better. The laureates’ research helps us understand why.
- When Europeans colonised large parts of the globe, the institutions in those societies changed. This was sometimes dramatic, but did not occur in the same way everywhere.
- In some places the aim was to exploit the indigenous population and extract resources for the colonisers’ benefit. In others, the colonisers formed inclusive political and economic systems for the long-term benefit of European migrants.
- The laureates have shown that one explanation for differences in countries’ prosperity is the societal institutions that were introduced during colonisation.
- Inclusive institutions were often introduced in countries that were poor when they were colonised, over time resulting in a generally prosperous population.
- This is an important reason for why former colonies that were once rich are now poor, and vice versa. Some countries become trapped in a situation with extractive institutions and low economic growth.
