Ructions about the latest Nobel Economics prize

The latest Nobel prize for Economics (actually only a Swedish bank award) is causing ructions. It has been won by Daren Acemoglu, Simon Johnson and James Robinson for their trilogy Why Nations Fail – the origins of power, prosperity and poverty (2012); The Narrow Corridor – how nations struggle for liberty (2019) and Power and Progress – our thousand year struggle over technology and prosperity (2023) 

Michael Roberts asseses their value annually and offers what is certainly 

the most exhaustive treatment of the issue – 
 

The work for which they received the $1m prize is for research that purports to 

show that those countries that achieve prosperity and end poverty are those 

that adopt ‘democracy’ (and by that is meant Western-style liberal democracy 

where people can speak out (mostly), can vote for officials every so often and 

expect the law to protect their lives and property (hopefully). Societies that are 

controlled by elites without any democratic accountability are ‘extractive’ of 

resources, do not respect property and value and so over time do not prosper. 

In a series of papers applying some empirical analysis (ie correlating democracy 

(as defined) with levels of prosperity), the Nobel winners claim to show this. 

Indeed, the Nobel winners argue that colonisation of the Global South 

in the 18th and 19th centuries could be ‘inclusive’ and so turn the 

likes of North America into prosperous nations (forgetting the 

indigenous population) or ‘extractive’ and so keep countries in dire 

poverty (Africa). It all depends. Such is the theory.
Two problems, however, First, if growth and prosperity go hand in hand with 

‘democracy’ and the likes of the Soviet Union, China, Vietnam are considered 

to have elites that are ‘extractive’ or undemocratic, how do our Nobellists 

explain their undoubted economic performance? Apparently, it is explained 

by the fact they started out poor and had a lot of ‘catching up’ to do, but 

soon their extractive character will catch up with them and China’s hyper 

growth will run out of steam. Perhaps now? 
Second, is it correct to say that revolutions or political reforms are 

necessary to set things on the path to prosperity? Well, there may be 

some truth in that: would Russia in the early 20th century be where it is 

today without the 1917 revolution or China be where it is in 2024 without 

the revolution of 1949.  But our Nobellists do not present us with those 

examples: theirs are getting the vote in Britain in the 19th century or 

independence for the American colonies in the 1770s.

Richard Wolff’s video commentary on the Nobel prize-winners on X 

sounds a marvellously humorous and succinct note 

A decade or so ago Acemoglu and Johnson shared their insights in 

an interesting article
 

We pointed out that three broad clusters of long-run economic and 

political institutions are possible. In the first (Absent Leviathan), 

the state is weak, while societal collective action and various norms 

are strong and constrain political hierarchy. In the second 

(Despotic Leviathan), the state is strong; it crushes and further 

impairs an already weak society. In the third (Shackled Leviathan), 

there is a balance between the state’s and society’s capacities, 

which enables their coevolution toward greater strength and also 

undergirds a very different type of state—simultaneously powerful 

and still accountable and responsive to society. 

Economic modernization is almost impossible under the Absent 

Leviathan. It is possible under the Despotic Leviathan, and under 

some circumstances it can proceed rather rapidly. But it will not 

bring democracy or accountable behavior by rulers and bureaucrats. 

The positive feedback between political institutions and economic 

development is only a feature of the Shackled Leviathan. 

As a result, economic changes in, say, South Korea will have 

fundamentally different implications than when the same changes 

happen in China. These insights, though formulated in a different way 

and yielding different implications than in the previous literature, 

are nevertheless related to some classic arguments in political theory. 

Machiavelli [1961 (1532), p. 67] proposed similar ideas more than 

500 years ago, identifying a related trichotomy: 

“The people are everywhere anxious not to be dominated or oppressed 

by the nobles, and the nobles are out to dominate and to oppress the 

people. These opposed ambitions bring about one of three results: 

a principality, a free city, or anarchy.” 
We are, of course, not the first ones to think about the role of culture 

in politics. Although cultural factors are not part of many of the 

seminal frameworks of political science—for example, Tilly’s (1990) 

theory of the emergence of states; Moore’s (1966) theory of 

capitalism, fascism, and communism; or more orthodox Marxist 

frameworks for understanding political and economic change—

they have featured in important contributions. Huntington (1996) 

places a heavy emphasis on culture in his work on civilizations. 

Culture has also played a critical role in the modern literature on 

nationalism and identity (Anderson 1983, Laitin 1998, Horowitz 2000, 

Gellner 2009) and in the literature about the impact of religion on 

politics (Laitin 1986; Kalyvas 1996; GrzymałaBusse 2012, 2015). 

Putnam’s (1993) theory of good democratic governance, 

building on Banfield’s (1958) insights, also includes a central role 

for cultural factors. Finally, Almond & Verba’s (1963) seminal work 

merges culture and political behavior in understanding the support 

for democracy.  

The rest of the article is organized as follows. 

The next section introduces our conceptual framework and highlights 

the interplay between politics and culture. It is followed by three 

sections that apply this framework to illustrative cases of Despotic, 

Absent, and Shackled Leviathans, starting with the Chinese case. 

We then distill some of the lessons from these case studies and 

reevaluate modernization theory. The concluding section suggests 

directions for future work. 

FURTHER READING

Interview with James Robinson (2024)

Noah Smith’s view of the fracas (2024)
A 68 page article on the role of culture on institutions by Acemoglu and Robinson (2023)
Leviathans in CEEC countries 2019
A World Bank presentation about “The Shackled Leviathan: (probably 2018)

The Nobel Factor – the prize in economics, social democracy and the market factor 
A Offner and G Soederberg (2016)

 

Why is the English Establishment so Zionist?

The good news is that an Employment Tribunal has upheld Professor David 

Miller’s plea of unfair dismissal against Bristol University on the grounds that 

he was perfectly entitled to use arguments of anti-Zionism. 

The full judgement (of 120 pages) can be read here 

The unanimous judgment of the tribunal is:

1. The claimant’s anti-Zionist beliefs qualified as a philosophical belief and as a protected characteristic pursuant to section 10 Equality Act 2010 at the material times.

2. The claimant succeeds in claims of direct discrimination because of his philosophical belief contrary to section 13 Equality Act 2010 in relation to:

3. The claimant succeeds in his claim for unfair dismissal pursuant to section 98 Employment Rights Act 1996.

4. The claimant succeeds in his claim for wrongful dismissal (failure to pay notice).

5. The claim for indirect discrimination is dismissed on withdrawal.

Professor Miller’s dismissal stemmed from a lecture in 2019 about which 2 Jewish students complained in which he identified Zionism as one of the five pillars of Islamophobia, the panel heard. The Community Security Trust, which campaigns against antisemitism, said Miller’s remarks were a “disgraceful slur”. According to one of few newspapers which bothered to cover the case

A review commissioned by the university found Miller had no case 

to answer because he did not express hatred towards Jews. In an 

email to the university’s student newspaper sent in February 2021 

Miller said: “Zionism is and always has been a racist, violent, 

imperialist ideology premised on ethnic cleansing.” In the message 

he also claimed the university’s Jewish Society was an “Israel 

lobby group”.

A separate review found these statements had been offensive to 

many, and in a hearing they were found to be “wrong and inappropriate”. 

He was then sacked for gross misconduct, the panel heard.

One prominent Conservative ex-Minister (Sir Alan Duncan) found 

himself being accused by his own party of anti-semisitism this year and, 

after being cleared, went on to express his view that the party was in the grip of 

a strong Israeli lobby - 

At a press conference in central London, Duncan went on to 

repeat his accusation that his party remained unduly influenced 

by people lobbying on behalf of the Israeli government. 

“Money, improper influence, and the promotion of Israeli 

interests above our own have contributed to the destruction 

of the UK’s independent foreign policy,” he said, adding: 

“The flow of money and the influence behind the scenes that 

attaches to it need to be exposed.” (and here's his recent 

tweet about the scale of the Foreign Office capture by 

theIsraeli lobby

Many Labour party Mps – including Starmer, Reeves and Lammy – have 

received thousands of pounds from that lobby which has actually placed 

assistants within the party. The scale of the lobby’s power is revealed in 

this long Open Democracy report from 2009 
 

The presence of an Israel lobby as a factor in British public life is 

systematically ignored in British reporting. For example, a search of 

the newspaper database Lexis Nexis showed there have been only 154 

mentions of the Conservative Friends of Israel in the British press, 

the first of which was apparently on 22 September 1985. 

By contrast The Tobacco Manufacturers Association enjoyed 1,083 citations 

during the same period, and the Scotch Whisky Association no fewer 

than 2,895. The Conservative Party donor Michael Ashcroft has been the 

subject of 2,239 articles over the comparable time period, and the 

1922 Committee of Tory backbenchers got over 3,000. 

The purpose of this pamphlet is to enquire whether this paucity 

of public coverage is indeed a reflection of the real influence of the 

pro-Israel lobby in British government 

One national newspaper editor told us, “that’s one lobby I’ve never dared 

to take on.” From MPs, to senior BBC journalists and representatives of 

Britain’s largest charities, the pattern became depressingly familiar. 

Material would come flooding out on the phone or in a meeting, but then 

days later an email would arrive to say that they would not be able to 

take part. One MP taunted the authors that we would never “have the guts” 

to make a television programme about the pro-Israel lobby. It was, 

he told us, “the most powerful lobby by far in parliament. It’s a big story. 

If you have any balls you’ll make a programme about it.” 

When we returned to the MP later on to ask if he would talk to us on the 

record, he felt unable to come forward and do so. One front bench 

Conservative MP was so paranoid he insisted we remove the battery from 

our mobile phones to ensure our privacy during the conversation. 

It was only senior MPs whose careers are winding down that felt able 

 to voice what many MPs told us in private. One of them, 

Michael Mates, a member of the Intelligence and Security Committee 

and former Northern Ireland minister, told us on the record that 

“the pro-Israel lobby is the most powerful political lobby. 

There’s nothing to touch them.” 

Mates added: “I think their lobbying is done very discreetly, in very high 

places, which may be why it is so effective.” 

Some journalists we spoke to had been accused of antisemitism, and felt 

inevitably it had done some damage to their careers. Others, like the 

BBC’s Orla Guerin, against whom this very serious and damaging charge 

has repeatedly been made by the Israeli government, wouldn’t even talk 

to us off the record. It is easy enough to see why. Guerin is a brave, 

honest and compassionate reporter. Yet the Israeli government has 

repeatedly complained to the BBC that Guerin is “antisemitic” and 

showed “total identification with the goals and methods of Palestinian 

terror groups.” 

Natan Sharansky, a cabinet minister at the time, wrote a formal letter 

to the BBC  accusing her of “such a gross double standards to the Jewish 

state, it is difficult to see Ms Guerin’s report as anything but antisemitic”. 

The following year, when Guerin was awarded with an MBE for her reporting

, Sharansky said: “It is very sad that something as important as antisemitism 

is not taken into consideration when issuing this award, especially in 

Britain where the incidents of antisemitism are on the rise.” Officially 

sanctioned smears like this show why so many people shy away from 

confronting the influence of the Israel lobby. 

The former Conservative Party chairman and shadow foreign secretary, 

Michael Ancram, who is standing down as an MP at the next general 

election, did have the courage to talk to us. He told us that he had 

been accused of antisemitism “because I’ve been talking to Hamas and 

Hezbollah. I just take that with a pinch of salt.” The accusation of 

antisemitism even touches the least likely of people. Antony Lerman, a 

man steeped in Jewish culture and history, who has worked for much of 

his career combating antisemitism, was labelled “a nasty anti-Semite” 

on a website designed to expose antisemitism on The Guardian’s website, 

for an article he wrote during the making of the film. He told us: “I think 

there are people who are deliberately manipulating the use of the term 

antisemitism because they do see that it’s useful in defending Israel.”

The Conservative Friends of Israel is beyond doubt the best connected, 

and probably the best funded, of all Westminster lobbying groups. 

Eighty percent of Conservative MPs are members. The leader of the 

Conservative Party is often expected to appear at their events, while 

the shadow foreign secretary and his team are subjected to persistent 

pressure by the CFI. 

Labour Friends of Israel has taken more MPs on trips than any other 

group. Only the CFI comes close. Since 2001, the LFI has arranged more than 

sixty free trips for MPs. LFI and CFI trips combined account for over 

13% of all funded trips for MPs and candidates. That’s more trips to Israel, 

a country with a population smaller than London’s, than to Europe, 

America or Africa. Even in America, where the pro-Israel lobby is 

extremely influential, trips to Israel account for only ten percent of all 

politicians’ foreign trips.

The group is similarly well connected within the party, and has regular 

meetings with David Miliband and his Foreign Office team to make Israel’s 

case. Labour MPs told us that young, ambitious MPs see a role at LFI as a 

good way to get ahead. Chairs of the LFI very often go on to become 

ministers. James Purnell and Jim Murphy, the Secretary of State for 

Scotland, are two recent chairmen. Ivan Lewis, the foreign office 

minister with responsibility for the Middle East, is a former vice-chair.

The genocide which the Israeli government is inflicting on Gaza and 

Lebanon is producing, in the UK and Europe, the largest public demonstrations. 

But the violence being shown to the demonstrators (particularly in 

Germany) reveals the strength and power of this lobby – as  

this Novara podcast reveals

UPDATES

An important article on the complicity of the MSM 

Ta-Nihisi Coates responds brilliantly here  to provocative questioning from US television about his treatment of Palestine in his new book "The Message" 

One of the two people left running for the Tory leadership, Robert Jenrick, 

has said the Star of David should be displayed at every point of entry to 

the UK to show “we stand with Israel”. He told a Conservative Friends of Israel 

event he wanted Britain to be “the most welcoming country in the world for 

Israelis and the Jewish community”. He said that, while immigration minister, 

he had pushed for Israelis travelling to Britain to be able to use e-gates. 

He said this would mean that at “every airport and point of entry to our 

great country”, there was a Star of David, as a “symbol that we support Israel”

GROUPTHINK

 The last decade has seen a new interest in a phenomenon which was last heard of some 50 years ago – with a short article by Irving Janis in 1971 paving the way for a full length book Victims of Groupthink (1972) which looked at such escapades as the Bay of Pigs to explore how leadership groups come to a consensus which labels any dissenter as a hostile voice.

Janis refined his analysis in 1991 with an analysis of the Challenger disaster 

And this was taken up in 1997 by Beyond Groupthink – political group dynamics 

and foreign policy-making (t’Hart et al)

Janis studied a number of historical fiascoes in American foreign policy, notably the lack of preparedness for the Japanese attack on Pearl Harbor (1941), the escalation of the war in Korea (1950), the failed U.S.-sponsored landing of anti-Castro rebels in the Bay of Pigs (1961), and the escalation of U.S. involvement in the war in Vietnam under President Johnson (1964–68). Each of these episodes went badly: the policymakers did not achieve their major goals, massive violence and many casualties resulted, and the government suffered a serious loss of domestic and international prestige.

Based on his detailed investigation of these episodes, Janis suggested that in each of them, the major decisions that shaped the course of events were reached after insufficient and unsystematic thinking and discussion. To bring this out more clearly, he contrasted them with two cases of policy success where policies had been developed in a more rigorous process (the making of the 1947 Marshall plan and the 1962 Cuban missile crisis). Specifically, Janis argued that in each of the failure cases, the decision-making process had been distorted by what he called groupthink: a tendency toward premature and extreme concurrence-seeking within a cohesive policy-making group under stress.

But it’s the last decade which has seen a development of the concept – with 

some 4 key publications, starting with The Silo Effect Gillian Tett (2015) 

who can be seen in this presentation, initially about the global financial crisis. 

Mastering silos is a constant battle, because the world around us is

constantly changing, pulling us in two directions. We need specialist, expert

teams to function in a complex world. But we also need to have a joined-up,

flexible vision of life. Mastering silos requires us to walk a narrow line

between these two contradictory goals. It is hard.

So how do we deal with this challenge? One place to start is to recognize

that silos exist and to think clearly about their effects. And I believe that a discipline that can help us to frame the analysis and debate is anthropology. This is not a field that normally springs to mind when people think about silos. On the contrary, when people have written about silos, they have usually done so by drawing on two bodies of research: management consultants, who offer advice on how institutions can organize themselves better; or psychologists, who study how our minds work. However, silos are fundamentally a cultural phenomenon. ey arise because social groups and organizations have particular conventions about how to classify the world.

Sometimes these classification systems are explicitly defined. New York’s

City Hall has official, formal structures that stipulate how each department

and team is organized and sits in relation to each other, in a hierarchy.

However, the conventions that we use to classify the world are often not

officially defined or spelled out. Instead, they arise out of a dense set of rules, traditions, and conventions that we have absorbed from our surroundings, often in an unthinking way. Many of the really important patterns we use to classify the world, in other words, are inherited from our culture. ey exist at the borders of conscious thought and instinct. ey seem natural to us, in the same way our culture appears “normal.” So much so, that we rarely even notice them at all, or even think about the fact that we have formal and informal classification systems that shape how we respond to the world.

But it was the US/UK Iraq War which brought home to most people the dangers 

of Groupthink – with an Independent Commission asked by Gordon Brown in 2009 

to explore the lessons of the disaster, Lord Chilcot  produced no less than 12 volumes

 of some 3,200 pages, reporting in 2016. This is its Executive Summary – at 

150 pages.  Learning from the Chilcot Report Piers Robinson (2017) is a good 

detailed analysis of the report.

Hardly surprisingly, the UK Ministry of Defence – one of the perpetrators of 

the disaster, was keen to learn lessons and duly produced in 2017 

The Good Operation 

Rebel Ideas – the power of diverse thinking Matthew Syd (2019) makes an important point

We need to think of human performance not from the standpoint of the individual but from the standpoint of the group. From this more rounded perspective, we’ll see that diversity is the critical ingredient driving what we might term collective intelligence.

There are, of course, many types of diversity. Differences in gender, race, age and religion are sometimes classified under the heading ‘demographic diversity’ (or ‘identity diversity’). We will be focusing not upon demographic diversity, but cognitive diversity. That’s to say, differences in perspective, insights, experiences and thinking styles.

There is often (but not always) an overlap between these two concepts. People from different backgrounds, with different experiences, often think about problems in different ways. We will analyse the precise relationship later in the book.

Cognitive diversity was not so important a few hundred years ago, because the problems we faced tended to be linear, or simple, or separable, or all three. A physicist who can accurately predict the position of the moon doesn’t need a different opinion to help her do her job. She is already bang on the money. Any other opinion is false. This goes back to our common-sense intuition. Thinking differently is a distraction. With complex problems, however, this logic flips. Groups that contain diverse views have a huge, often decisive, advantage.

The final book worth mentioning is Groupthink – a study in self-delusion by 

Chris Booker (2020) which is a  bit of a right-wing knockabout.