To revolt or not to revolt? That is the question that Acemoglu’s work doesn’t help us answer.
On the one hand, we have powerful elites that we must do our best to coddle, as I noted in my last post. This is in part so they don’t take away our tech toys (block innovation that unseats their political power), but in other cases – like a fairly glowing description of the coddling of Pinochet in Chile – coddling elites doesn’t seem to have any economic rationale.
Looking at the US South after the Civil War, AceRob conclude that de jure political changes will simply encourage elites to invest in de facto power. AceRob’s
book Why Nations Fail sneeringly references the Mexican, Bolivian, Cuban, Nicaraguan and other Latin American revolutions, when “expropriation or the threat of expropriation of assets continued apace…” (page 48) Indeed, in an earlier paper on Latin America, they conclude that progressive governments tax too much, so sow the seeds of their own defeat by coup. Lula’s government in Brazil is praised for not undertaking radical revolution, while Peron’s Argentina is faulted for populism. The only praise the authors can manage for Hugo Chavez was that he was so incompetent that he couldn’t institutionalize his rule.
On the other hand, revolutions can be great. Acemoglu and company look at the parts of modern day Germany that were conquered by Napoleon (and had relatively modern legal systems imposed on them), and find that they experienced more rapid economic growth (as proxied by urbanization) than those regions that did not. A quick scan through Why Nations Fail will shows around a hundred mentions of the word “revolution,” a few condemning Great Leaps Forward, but mostly celebrating (mere) great leaps forward like the Glorious Revolution (rocked it), Neolithic Revolution (planted it) and the Industrial Revolution (built it on a steam ship). Deng’s “political revolution” in China gets a favorable nod. Even the South Korean land redistribution gets a positive nod in earlier work – although the authors fail to note the land was redistributed by the North Korean government when it temporarily occupied the South in 1950 (so much for the capitalist origins of the South Korean miracle!)
These revolution-hellyes-waithellno tendencies are on display in Acemoglu’s paper on Botswana’s development experience.
The sub-Saharan country has had the highest consistent economic growth rate in the world – somehow managing to escape the “African curse” that has kept so many nations mired in poverty. How’d they do it?
On the one hand, it was because of major exogenous influences. As they detail in Chapter 14 of Why Nations Fail and in an earlier paper, the Khama dynasty of Botswana adopted Western religion, courted Western leaders, married Western women, retained a civil service full of Westerners, and partnered with and sold to Western economic interests – even after independence. They sidestepped the power of society in order to build a state – thereby avoiding the curse of weak or failed states endemic in the region. Not a revolution, but not a model of endogenous incremental development either. The authors distinguish Botswana from Somalia (which had too weak a state), Lesotho (which had too strong a state), Ghana (where the political elites didn’t play nice with the economic elites), and Cote d’Ivoire (where the economic elites didn’t play nice with enough of the political elites).
At the same time, slow and steady might have won the race. Acemoglu and company argue that a major reason is that the powerful never doubted they’d have a place in the power structure. They were chiefs, and chiefs had an institutionalized influence in the major political parties. They were cattle dudes, and they could be sure that direct government policy would help their bottomline. They were consulted through traditional deliberative institutions called kgotlas, so they were willing to give up more power so that a centralized government could be set up. Oh, and they benefited from diamond rents too. It’s important to note that the supposed reason for coddling the elites in the Acemoglu theoretical framework is so that they don’t block technological innovation. But Botswana’s pro-elite consensus has hardly led to much dynamism: it’s 2 million people have been governed by the same people since independence, and AceJohnRob report that manufacturing has stayed at around 5 percent of the economy. It has substantial growth, but not because of creative destruction in politics or economics.
So how to square the simultaneous celebration of weakness and strength? In a classic Acemogluism, the state was able to grow strong because it was constrained. By what, one asks, when the same family dominated the economy and government for decades? By the kgotla. Given the importance in Acemoglu’s account, you’d think we’d get a pretty detailed explanation of how this constraint worked. Instead, we basically get a paragraph of detail over a 53 page paper. Here are the highlights:
The kgotla was an assembly of adult males in which issues of public interest were discussed. Both wards and the whole society itself had kgotlas. Even though they were supposed to be advisory they seem to have been an effective way for commoners to criticize the king. They also were the venue where the king heard court cases and law was dispensed… important. Contrary to many other countries in Africa, colonial rule did not strengthen Botswana’s chiefs and did not destroy the kgotla and other related institutions, nor did it introduce indirect rule with substantial power delegated to the political elites representing the British Empire (see for example, Ashton, 1947, and Migdal, 1988).
While the authors note in a footnote that “There is controversy about the importance of the kgotla today with some scholars seeing it as a ‘rubber stamp’ on elite policies than an institution with significant power”, they nonetheless confidently assure that Botswana’s latter day success meant that “political elites faced effective constraints. For example, political institutions such as the kgotla, which ensured a certain degree of accountability of political elites…”
It’s difficult to extract anything like development policy or even political advice from this heap. Maybe “revolt when blessed with the correct institutional endowments, otherwise sit tight”?