AJR Eurocentric Framework

Context

Daron Acemoğlu, Simon Johnson, and James Robinson (AJR) won the 2024 Sveriges Riksbank Prize in Economic Sciences (this year’s Nobel laureates in the economic sciences) for their research on how institutions shape economic prosperity.
While their work has been highly influential, critics argue that their approach is overly Eurocentric.

Flaws In AJR Model

Eurocentrism and Western Institutional Bias: AJR’s model assumes that European-style institutions are the best path to prosperity, implying that other nations should mimic Europe’s history. This view overlooks the varied paths to development that different regions have taken successfully.
Rigid, Binary Approach to Institutions: AJR categorises institutions as either “inclusive” or “extractive,” which many scholars argue is too rigid.
- They suggest that institutions evolve and adapt according to local needs, pointing to China’s success with decentralised, flexible policies as an example.
Simplified View of Western Development: AJR’s model idealises Western institutions as naturally “inclusive,” ignoring historical realities like exploitation and cronyism during times like Britain’s Industrial Revolution.
- These less-than-ideal practices also played a role in Western economic growth.
Overlooking State-Led Industrial Policies: AJR’s model underplays the importance of protectionism, state planning, and other so-called “extractive” policies that helped countries like the U.S. and U.K. industrialise.
- These countries only fully embraced open-market policies after they had already built their industries.
Simplistic View of Colonial Institutions: AJR portrays colonial institutions as either purely extractive or inclusive, missing the mixed nature of colonial governance.
- Colonisers often blended local and foreign authority, leading to diverse post-colonial outcomes not easily categorised.
Minimising the Long-Term Impact of Colonialism: AJR downplayed how colonial institutions locked former colonies into economic dependency, leaving many regions, especially in Africa and Latin America, impoverished despite rich natural resources.
- Critics argue that wealth in the Global North was partly built on exploiting these colonies.