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Summary of Why Nations Fail (Part - 1)

The book "Why nations fail" is worth reading because it provides deep insight and remarkable underlying facts, accounting for why some nations are prosperous and some are in misery. The conjunction of the historical analysis with the existing inequalities of the globe is one of the most critical aspects of the book. The authors of the book "Daron Acemoglu and James A. Robinson" made commendable efforts; thereby, it could become New York Times's best-selling book.


Inclusive vs. Extractive Institutions:


Nogales provinces: Arizona vs Sonora:

Nogales is a region that constitutes two different modern cities: Arizona (USA) and Sonora (Mexico). Although both geographies hold the same climate, ethnicity, and historical lineage, the living conditions of people are pretty different. In Arizona, people with high average incomes and health security, receive a quality education and enjoy vacations are living a life dreamed of by various low-income countries.


On the other hand, those privileges given to Arizona's inhabitants are unavailable to Sonora's public. Robinson and Acemoglu explain these discrepancies very eloquently. They argue that the differences between the conditions of Nogales are because of the different institutions under which people are governed. Arizonians are under the shelter of the USA's constitution and institutions, while the people in Sonora live under Mexican authorities. It is clear from the facts that the institutions matter very much. The USA holds an inclusive economic system, while Mexico is glued to the extractive. People in the USA are freer to do business and become entrepreneurs more quickly than in Mexico.