19th Century woodcut depicting Adam Smith and the Industrial Revolution

19th Century woodcut depicting Adam Smith and the Industrial Revolution

Presented with the kind permission of The Independent Institute

February 21 2008 panel discussion with:
Benjamin Powell, Alvaro Vargas Llosa, George B. N. Ayittey

Excerpt from synopsis of the book on which this discussion is based:

Why do some nations become rich while others remain poor?

Traditional mainstream economic growth theory has done little to answer this question — during most of the twentieth century the theory focused on models that assumed growth was a simple function of labor, capital, and technology.

Through a collection of case studies from Asia and Africa to Latin America and Europe, Making Poor Nations Rich: Entrepreneurship and the Process of Economic Development emphasizes the critical role that entrepreneurs, private-property rights, and economic freedom play in economic development.

Making Poor Nations Rich begins by explaining how entrepreneurs create economic growth and why some institutional environments encourage more productive entrepreneurship than others.

The volume then addresses countries and regions which have failed to develop because of barriers to entrepreneurship. Finally, the authors turn to countries that have developed by reforming their institutional environment to protect private-property rights and grant greater levels of economic freedom.

“The overall message of this book is simple, yet is vitally important for the millions who reside in underdeveloped regions of the world,” writes Benjamin Powell in the introduction.

“Economic freedom and private-property rights are essential for promoting the productive entrepreneurship that leads to economic growth. In countries where this institutional environment is lacking, sustained economic development remains elusive. When countries make pro-market reforms that enhance their institutional environment, growth improves—sometimes dramatically.”