Acemoglu, Johnson, and Robinson (2001) according to Tim Harford

In a review of Economic Gangsters, Tim Harford dedicates four paragraphs to describing AJR’s “The Colonial Origins of Comparative Development: An Empirical Investigation”  (AER, 2001). An objection and a compliment:

  • Harford uses language like “Acemoglu’s study” and “Acemoglu observes.” But he’s not describing Acemoglu’s large body of work; he’s just talking about one particular paper coauthored with two other economists. Such presentation of the research is rather unfair to Simon Johnson and James Robinson.
  • Instrumental variables are quite difficult to explain to non-economist audiences, but I think that Harford’s summary does a good job of communicating that colonial history is an instrument rather than “the root of the variance in income levels around the world” (though AJR’s paper itself may blur that distinction). His narrative emphasises that institutions shape economic growth and appropriately confines the discussion of settler mortality to its effect on institutions.