In essence, AJR argue that European settler mortality rates only affect economic development through their effect on institutions. They argue that settlers put better institutions in place in environments with lower risk of mortality, and more extractive ones when there was a high mortality risk. They also argue that those historic mortality rates should not affect income per capita today.
how do you build/have “good institutions” and how useful is that for developing countries to see the importance of democracy when you have China as an example of little to no democracy but with considerable economic growth over the last 20yrs or so?
Nice. How exactly does the IV play out in AJR (2001)? TIA!
In essence, AJR argue that European settler mortality rates only affect economic development through their effect on institutions. They argue that settlers put better institutions in place in environments with lower risk of mortality, and more extractive ones when there was a high mortality risk. They also argue that those historic mortality rates should not affect income per capita today.
Thanks! Quite interesting, given that so many disagreements exist with that paper today. Seminal nonetheless!
how do you build/have “good institutions” and how useful is that for developing countries to see the importance of democracy when you have China as an example of little to no democracy but with considerable economic growth over the last 20yrs or so?