### Nobel Prize in Economics Awarded to Trio for Research on Institutions and Economic Development

Economists Daron Acemoglu, Simon Johnson, and James Robinson have been honored with the 2024 Nobel Memorial Prize in Economic Sciences. This recognition was given for their groundbreaking work on the role of institutions in shaping economic development. Their paper, which has become one of the most frequently cited in the economics field, along with their influential book, *Why Nations Fail*, has sparked significant debate and discussion on this topic.

Acemoglu, Johnson, and Robinson categorize institutions into "inclusive" and "extractive." Inclusive institutions, according to their research, support economic prosperity by enforcing property rights, protecting democratic processes, and curbing corruption. Conversely, extractive institutions centralize power and resources among a small elite, hindering broader economic growth. Their work suggests that the establishment of inclusive institutions has had a lasting positive impact on prosperity, a claim supported by the prevalence of these institutions in wealthy Western countries.

However, this theory has not gone without criticism. Critics like Mushtaq Khan from Soas, University of London, argue that the laureates' work fails to show that inclusive institutions are a prerequisite for economic development. Historical examples from East Asia, such as Singapore, South Korea, Taiwan, and more recently, China, illustrate that significant economic growth can occur without these institutions initially in place. Yuen Yuen Ang also points out that the United States experienced considerable corruption throughout its developmental stages.

Another point of contention is the laureates' approach to colonialism. Their research distinguishes between settler colonies, like the US, Canada, and Australia, where Europeans implemented inclusive institutions, and non-settler colonies in Africa and Latin America, where extractive institutions were more common. They claim that settler colonies have performed better over time, but critics argue that this assessment does not adequately address the violent and often brutal history of colonialism, which preceded the development of these institutions.

Acemoglu's comment that normative questions about colonialism were not a concern for their study has also raised eyebrows. This perspective, while not unexpected within the field of economics, highlights the discipline's tendency to shy away from value judgements, which has led to its perceived isolation from other social sciences.

The Nobel Memorial Prize in Economic Sciences, which was established later than the original Nobel Prizes, often faces critiques for its narrow focus on economists from a select group of elite US universities. This year's prize continues that trend, emphasizing the importance but also the limitations of current economic research paradigms.