Why Nations Fail

C
HAPTER
 2 : T
HEORIES
 T
HAT
 D
ON’T
 W
ORK
Jared Diamond’s views on world inequality are laid out in
his book 
Guns, Germs and Steel
(1997). Sachs (2006)
sets out his own version of geographical determinism.
Views about culture are widely spread throughout the
academic literature but have never been brought together
in one work. Weber (2002) argued that it was the
Protestant Reformation that explained why it was Europe
that had the Industrial Revolution. Landes (1999) proposed
that Northern Europeans developed a unique set of cultural
attitudes that led them to work hard, save, and be
innovative. Harrison and Huntington, eds. (2000), is a
forceful statement of the importance of culture for
comparative economic development. The notion that there
is some sort of superior British culture or superior set of
British institutions is widespread and used to explain U.S.
exceptionalism (Fisher, 1989) and also patterns of
comparative development more generally (La Porta,
Lopez-de-Silanes, and Shleifer, 2008). The works of
Banfield (1958) and Putnam, Leonardi, and Nanetti (1994)
are very influential cultural interpretations of how one aspect
of culture, or “social capital,” as they call it, makes the south
of Italy poor. For a survey of how economists use notions of
culture, see Guiso, Sapienza, and Zingales (2006).
Tabellini (2010) examines the correlation between the
extent to which people trust each other in Western Europe
and levels of annual income per capita. Nunn and
Wantchekon (2010) show how the lack of trust and social
capital in Africa is correlated with the historical intensity of
the slave trade.
The relevant history of the Kongo is presented in Hilton
(1985) 
and 
Thornton 
(1983). 
On 
the 
historical
backwardness of African technology, see the works of
Goody (1971), Law (1980), and Austen and Headrick
(1983).
The definition of economics proposed by Robbins is
from Robbins (1935), p. 16.
The quote from Abba Lerner is in Lerner (1972), p. 259.
The idea that ignorance explains comparative development

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is implicit in most economic analyses of economic
development and policy reform: for example, Williamson
(1990); Perkins, Radelet, and Lindauer (2006); and Aghion
and Howitt (2009). A recent, forceful version of this view is
developed in Banerjee and Duflo (2011).
Acemoglu, Johnson, and Robinson (2001, 2002) provide
a statistical analysis of the relative role of institutions,
geography, and culture, showing that institutions dominate
the other two types of explanations in accounting for
differences in per capita income today.

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