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11 Cards in this Set
- Front
- Back
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Extractive institutions |
-institutions designed to extract incomes/wealth from a subset of society which benefits another -narrow elite, with power they design the economic practices -feedback loop: economic procedures continue to support unopposed political power, vis versa. Newcomers to power will still repeat the same system. I.e. North Korea, Barbados |
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Inclusive institutions |
-encourage the masses to participate in economic activities -support talents and skills of individuals to make free choices -supports private property, unbiased law, public services for level playing field, new businesses, choice I.e. education + tech (equal distribution) -reliance on the above on the state + coercive power -economic and political inclusive inst., will find these two working together, unstable if mixed-pluralism + inclusive institutions (+ centralized power) (Max Weber: monopoly of legitimate violence) I.e. South Korea, United States |
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Vicious circles |
-where extractive economic/political institutions once in place persist |
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Virtuous circles |
-where inclusive economic/political institutions -neither is absolute -being able to break these cycles (institutional drift?) |
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Institutional drift |
-how institutions drift due to the conflict/power interaction of similar societies, (go in different directions) -small difference come and go, sometimes bigger ones develop (Critical junctures) -history, study the diff circles ^^ |
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Critical junctures |
-lead to disruption of political and economic balance in society(s) -lead to institutional divergence -intersection with inst. Drift I.e. Atlantic trade -history, circles |
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Creative destruction |
-process where innovations replace old tech -creates winners and losers -sectors threatened by creative destruction try to block innovation I.e. electric car, e-books |
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Black Death |
-as an example of critical juncture -impacted England -killed half the population, upset the feudal system, opening of Atlantic trade routes, profit opportunities, Industrial revolution (rapid, destructive changes in economic structure) |
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Modernization theory |
-all societies headed towards modern, developed, civilized, democratic existence -democ. + inclusive inst. By product of growth proces s-democracy + inclusive inst. (not nesc. Go together, but one can lead to the other) I.e. mcdonald's in USA -democracy + growth, but also extractive inst. + growth though not sustainable, not all growth leads to democ. I.e. China |
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Technocratic approach |
-importance of giving good advice to leaders in struggling countries -does not mean they are ignorant, subject to political pressures that restrict their options thus policy advice is not adopted |
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Micro-market failures |
-in poor countries, i.e. education system, healthcare, market structure-these small things may be symptoms of larger issues in extractive inst. -policy makers/bureaucrats take advantage of, backfire for addressing real causes, structures don’t allow solutions |
