Political Losers as a Barrier to Economic Development

It is argued that the effect of economic change on political power is a key factor in determining whether technological advances and beneficial economic changes will be blocked. In other words, a political-loser hypothesis is proposed. It is argued that it is groups whose political power is eroded w...

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Bibliographic Details
Published in:The American economic review 2000-05, Vol.90 (2), p.126-130
Main Authors: Acemoglu, Daron, Robinson, James A.
Format: Article
Language:English
Subjects:
Appropriate technology
Aristocracy
British Industrial Revolution
Economic development
Economic fluctuations
Economic models
Economic rent
Economic theory
Effects
Emerging technology
Hypotheses
Industrial development
Industrialization
Interest groups
Political economy
Political Economy, Governance, and Development
Political power
Railways
Studies
Technological change
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Summary:It is argued that the effect of economic change on political power is a key factor in determining whether technological advances and beneficial economic changes will be blocked. In other words, a political-loser hypothesis is proposed. It is argued that it is groups whose political power is eroded who will block technological advances. If agents are economic losers that have no political power, they cannot impede technological progress. If they have and maintain political power, then they have no incentive to block progress. It is therefore agents who have political power and fear losing it who will have incentives to block. The analysis suggests that one should look more to the nature of political institutions and the determinants of the distribution of political power to understand technological backwardness.
ISSN:0002-8282
1944-7981
DOI:10.1257/aer.90.2.126