Thursday, April 4, 2013
Chapter 4 - Small Differences and Critical Junctures
Chapter 3 - The Making of Prosperity and Poverty
This chapter insists that it is government's responsibility to make the country prosper. I also agree with the statement, because public services and careers are offered by the government.
Nations' living standards depend on how well the government provides the public services, such as medical service and education service. It is importance for the government to provide proper medical service, because if people cannot maintain the proper state of health, there will be increase in unemployment rate because of sickness. This will eventually lead to decrease in consumer spending since people are not able to work, and will lead to economic crisis. Providing education service is also important, because for a country to prosper, the country needs a substantial number of high educated people to manage the economy, businesses, sciences, and etc. Therefore, the government should offer capable public education system to produce many high skilled people.
Another factor that rejuvenates the nations' living standard is providing a wide range of career and proper management for workplaces, such as setting minium wage and maxium work hours. To increase the GDP and productivity of the country, there should be a high rate of employment. Therefore, the government is highly responsible to improve the country's prosperity.
Nations' living standards depend on how well the government provides the public services, such as medical service and education service. It is importance for the government to provide proper medical service, because if people cannot maintain the proper state of health, there will be increase in unemployment rate because of sickness. This will eventually lead to decrease in consumer spending since people are not able to work, and will lead to economic crisis. Providing education service is also important, because for a country to prosper, the country needs a substantial number of high educated people to manage the economy, businesses, sciences, and etc. Therefore, the government should offer capable public education system to produce many high skilled people. Another factor that rejuvenates the nations' living standard is providing a wide range of career and proper management for workplaces, such as setting minium wage and maxium work hours. To increase the GDP and productivity of the country, there should be a high rate of employment. Therefore, the government is highly responsible to improve the country's prosperity.
Chapter 2 - Theories that don't work
In this chapter, there are three types of theories mentioned that are meaningless to explain the different prosperity of each country.
First theory is the Geography Hypothesis. This theory claims that the great divide between rich and poor countries is created by geographical differences, for example, climate, terrain and etc. However, this book reveals that this theory is not correct. It says that the difference between countries is not determined by geographical factors, but by institutional factors. It also claims that there is no such historical evidence that can prove the different prosperity between countries are created by geographical factors. For example, Africa is relatively a poor country than other countries. Many people die of hunger and diseases. Some people might think that it is diseases that makes the country poor, however, on the book, it concludes, "Disease is largely a consequence of poverty and of governments being unable to or unwilling to undertake the public health measures necessary to eradicate them."
Second theroy is the Culture Hypothesis. This theory consists of the changes of countries are mostly determined by their religion and nationalism. There is a clear explanation that proves the Culture Hypothesis is wrong in this chapter. Let's take an example of South and North Korea. South Korea is relatively richer than North Korea, and their cultural norm and religions are different from North Korea. South Korea preserved the cultural norm from the past, while North Korea do not. South Korea has free of religion, but North Korea do not allow people to have any religion. However, these differences of cultural norms and religions cannot be an evidence that shaped the differences between those two countries, because both countries had exactly the same culture and religion before they were splited. The differences between those two halves were gradually created after they were divided.
Final theory is Ignorance Hypothesis. This theory bascially saying that it is the leader who makes the country poor or prosper. However, it is quite dangerous to say, because it is true that if the president of a country is a capable leader, the country can prosper, however, they mostly get advise from elite economists. Therefore, even a good leader can make the country poor by others around.
First theory is the Geography Hypothesis. This theory claims that the great divide between rich and poor countries is created by geographical differences, for example, climate, terrain and etc. However, this book reveals that this theory is not correct. It says that the difference between countries is not determined by geographical factors, but by institutional factors. It also claims that there is no such historical evidence that can prove the different prosperity between countries are created by geographical factors. For example, Africa is relatively a poor country than other countries. Many people die of hunger and diseases. Some people might think that it is diseases that makes the country poor, however, on the book, it concludes, "Disease is largely a consequence of poverty and of governments being unable to or unwilling to undertake the public health measures necessary to eradicate them."
Second theroy is the Culture Hypothesis. This theory consists of the changes of countries are mostly determined by their religion and nationalism. There is a clear explanation that proves the Culture Hypothesis is wrong in this chapter. Let's take an example of South and North Korea. South Korea is relatively richer than North Korea, and their cultural norm and religions are different from North Korea. South Korea preserved the cultural norm from the past, while North Korea do not. South Korea has free of religion, but North Korea do not allow people to have any religion. However, these differences of cultural norms and religions cannot be an evidence that shaped the differences between those two countries, because both countries had exactly the same culture and religion before they were splited. The differences between those two halves were gradually created after they were divided.
Final theory is Ignorance Hypothesis. This theory bascially saying that it is the leader who makes the country poor or prosper. However, it is quite dangerous to say, because it is true that if the president of a country is a capable leader, the country can prosper, however, they mostly get advise from elite economists. Therefore, even a good leader can make the country poor by others around.
Chapter 1 - So Close and Yet So Different
There are many things we can learn about international differences from this book. This book will solve the questions that many people might wondered.
The common question from most of people is the factors that makes the country to prosper or fail. Some people believe the difference between countries are determined by geographical factors, such as climate, terrain and etc. However, this book tells us that the geographical factors do not have significant influence on wealth of the country, but the economical factors affects the country. Let's take an example of Nogales, Sonora and Nogales, Arizona, where they have similar geography. If we look at the life of Sonora, it is relatively poor contrast to Arizona. Most of people do not have proper education, crimes occur very often, and rules, and laws are out of control. You might ask why are those two regions totally different despite the fact they are on the same continent. The rational behind this is that Nogales, Arizona is in United State, where it is known as an advanced country. People in Arizona have access to economic institutions of United States, where they have opportunity to get educations and wide range occupations.
Another example of the factors that makes the difference between two countries will be the difference of market system. Calca and Acomayo are one of thirteen provinces of Cusco Region. The two provinces have similar agricultural system that they grow same crops. However, people in Calca sell those crops to accumulate money to better their living standards, while people in Acomayo grow the crops to maintain their own subsistence.
The common question from most of people is the factors that makes the country to prosper or fail. Some people believe the difference between countries are determined by geographical factors, such as climate, terrain and etc. However, this book tells us that the geographical factors do not have significant influence on wealth of the country, but the economical factors affects the country. Let's take an example of Nogales, Sonora and Nogales, Arizona, where they have similar geography. If we look at the life of Sonora, it is relatively poor contrast to Arizona. Most of people do not have proper education, crimes occur very often, and rules, and laws are out of control. You might ask why are those two regions totally different despite the fact they are on the same continent. The rational behind this is that Nogales, Arizona is in United State, where it is known as an advanced country. People in Arizona have access to economic institutions of United States, where they have opportunity to get educations and wide range occupations.Another example of the factors that makes the difference between two countries will be the difference of market system. Calca and Acomayo are one of thirteen provinces of Cusco Region. The two provinces have similar agricultural system that they grow same crops. However, people in Calca sell those crops to accumulate money to better their living standards, while people in Acomayo grow the crops to maintain their own subsistence.
Monday, February 25, 2013
Why Nations Fail
Why Nations Fail
Why does some countries prosper while others are poor? What are some factors that makes the country to develop or fail? This book, 'Why Nations Fail,' by two economists Daron Acemoglu and James A. Robinson answers those questions by explaining how each countries have developed with specific examples from the past.
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