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Daron Acemoglu

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64
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2019-12-04
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2019-12-04
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  1. “So if you take Bill But if he works with other programs, we'll come back to that. So that's why I said let's come back to human capital externalities, but to understand where the Mankeuroma and Weil either go wrong or right about depending on your views on human capital externalities is that their implied returns that three or four years would be associated by three or fourfold increases in income per capita. And the later literature that followed, some of it very good, some of it not so good because there are other methodological issues, but they all uniformly find much more limited returns to human capital. And that's not my work. Here I'm actually building on other people's work, such as Pete Kleenow, Andres Rodriguez-Claire, or others, who have really made this point very effectively. The sort of nuance here is exactly what you've pointed out, some sort of human capital externalities. Could it be that the return for a society from education is much, much larger than what we measure minster regressions when we look at an individual's own earnings?”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “Back to that, then that's going to increase your GDP per capita by 25 30%. That's a very small number relative to the gaps that we actually observe. So if you look at what...”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “Well, I think Manku Romer and Weil is a very important paper for its time, but it also has a lot of problems. So the most major problem of Manky Ramaran Wild is that it's a regression framework of cross-country differences or changes that really has no way of dealing with omitted variable bias. And one way of seeing that in the context of Merkel, Roman Wild, if we go a little bit into the details, is that if you compute the implied rate of returns to human capital, they are about four or five times as large as what you would get from Minsk regression. So the Minsk regression says if you get one more year of schooling, you're going to increase your earnings by about 6% in the US, perhaps as high as 8 or 9% in some developing countries. Let's say 10%. Let's be generous. So that means that if you are going to increase your rate of schooling by 3 or 4%, and if there are no major human capital externalities, and we can come”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “Human capital. That matters, of course. That matters for the values. But really, Russian educational institutions have persisted. Take away those. They collapse and nothing remains. And you've seen that happen in some of the Russian republics, for example. So they had pretty good educational institutions at the time, but then in the context of the civil wars that ensued, for example, some of those educational institutions have collapsed and rebuilding them has been much harder.”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “No, no, absolutely. There's no doubt that Russians are bringing more human capital. If you look at the Russian educational system, especially during the Soviet time, there was a lot of emphasis on math and physics and some foundational areas. And there's a lot of selection among the Russians who come here. There are a lot of criminal Russian elements who come to Europe, and they do very well, but for different reasons than the mathematical or the physical sciences, human capital, that they're bringing. But I would say what the Russian scientists are bringing, and that's very well sort of documented, for example, in the case of after the collapse of the Soviet Union, Russian mathematicians came here and they took jobs from American mathematicians because they were actually better. Well, that's both human capital and institutions, meaning that the reason why that's actually persisting is not simply that the current generation of Russians have parents who are very high.”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “That's an interesting question. You know, I think the Russian story is complicated. And I think part of Russian income per capita today is because of natural resources. So it's always a problem for us to know exactly how natural resources should be handled. Because you can do a lot of things wrong and still get quite a lot of income per capita via natural resources.”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “Declaration evolved and other things evolved in the U.S. was actually in reaction to British power. I mean, the important story, which of course everybody knows is that Declaration of Independence was in order for the Americans to reject the European imposition to some degree. But actually, the story goes much further back if you take the first...”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “No, that's why I'm saying that the whole European colonization episode has to be taken in its entirety. But it isn't also sort of a straight line to say that Europeans brought ideas, and that's what really sort of changed the trajectory in a good way. You know, Europeans settled in some numbers in Barbados. In 1680, about 10,000 people in Barbados had European ancestry and probably about 2,000, 3,000 were British. But these people who benefited mightily from the plantation complex and from about 40,000 people being chattel slaves did not have any idea of introducing a declaration of independence. They actually established a very draconian regime. Executions were commonplace. All the power was concentrated in the hands of about 150 families that were the big plantation owners. And the way that in the”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “Fortune is a prima facie evidence against a purely geographic explanation. Now, what else could explain it? Well, essentially there are two broad categories, the details, of course, within those categories matter, but there are two broad categories. One is that it's the institutions, as I've sort of tried to explain, and second is sort of culture, perhaps Europeans brought their culture into some places or messed up the culture in some other places. And the human capital is sort of somewhere in between, because human capital is an institutional feature, meaning that it really depends on the educational investments, but it also, of course, has a cultural element. So a lot of the qualitative and the quantitative research that we have done puts much more emphasis and finds more support for the institutional interpretation. For example, if you take human capital, it wasn't that Europeans brought human capital to the places that, such as the US or Argentina or Chile, actually the Europeans who were more educated were the ones who went to places such as”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “Well, I think it's a complex picture, actually. So one of the papers that I wrote with James Robinson and Simon Johnson, which we entitled Reversal of Fortune, is exactly on that point. So the raw fact is that, you know, if you look at which are the places that are more prosperous in 1500, those turn out to be relatively less prosperous today. It's not to say that they became less rich today every place in the world became much richer because of industrialization, because of much better technologies, trade and all of that. But relatively speaking, it was places that were empty without any urbanization, without much established road networks or agricultural surplus, such as Chile, Argentina, US, Canada, relative to the places that I mentioned a moment ago, Bolivia, Peru, Ecuador, Mexico, India, Pakistan that actually became richer. So that reversal of”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “Made impossible in most of these places because associated with both climatic conditions and the dense population, they had vectors of diseases that were very, very different than the ones the Europeans were used to. So the mortality rates that Europeans face were very different. So the combination of these two factors meant that the colonization experience was very different and the colonial institutions were very different in these places. And to a first approximation, all of that big gap between places such as US, Argentina, Chile, and places like Peru, Bolivia, India, Pakistan can be explained by these different colonization strategies and their institutional implications.”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “Was one of the more democratic places in the 19th century. The US, of course, introduced a sort of a smallholder society much better than Britain. But in most of the tropical areas, the conditions that Europeans encountered led them to adopt a very different colonization strategy. And essentially for two separate but related reasons. Many of the more civilized and densely populated areas were near the tropics, so the in-kind parts, the Aztec empires, the Indian subcontinent with the Mughal Empire colonized by the British, the North African civilizations. And all of those created a much better opportunity for Europeans to set up what James and I call extractive institutions, to essentially control labor and use labor. And moreover, the settlement pattern that was at the root of the better institutional development of places such as the US, Canada, Australia, really was”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “Yeah, it's a bit of an accident. So essentially, if you think of which are the countries around the equator that have such low income per capita, they are all former European colonies that have been colonized in a particular way. So for a variety of reasons, and geography might have played a role, though I'm not completely sure, European powers pulled ahead of the rest, and then they went ahead and colonized much of the rest of the world. Today, You know, for about 120 countries, their current institutions are heavily shaped by their colonial experience. And the colonial episode has been very unequal for different countries. If you take places such as the United States or Australia, they ended up with pretty good institutions, actually better institutions in many ways than their mother country back at home because the settlers who sort of got to live in these places pushed for better institutions, fought for better institutions.”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “Think it's not a particularly good theory. If you look at the map of the world and color different countries according to their income per capita, you'll see that a lot of low income per capita countries are around the equator. And some of the richest countries are pretty far from the equator in the temperate areas. So many people have jumped to the conclusion that there must be a causal link. But actually, I think geographic factors are not a great explanatory framework for understanding prosperity and poverty.”

    2019-12-04 · Conversations with Tyler · Daron Acemoglu on the Struggle Between State and Society · IDENTIFIED FROM THE TRANSCRIPT · source