2. Lessons from David S. Landes book “The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor”.

 2.1 Background

Since I come from India, Indian economic condition has always intrigued me. I never found a satisfactory answer to the question of why India was left far behind in the race for economic development.  Its economy was no worse than rest of the world at one time in history. I took a course at Bush School in Texas A&M University, which dealt with economic disparity between different nations. The course tried to answer the question ‘why are some countries rich while others are poor’. Since this question always intrigued me, I took this course. As part of the course I read the influential book from Landes. I made notes about what I learnt from economic history of nations.

Here are five:

·        Try to make sure that your government is a government that enables innovation and production, rather than a government that maintains power by massive redistributions of wealth from its enemies to its friends. Going by this logic, governments, which come in power by playing one group of people against another, are most dangerous. Democratic governments that come to power on issues of caste, religion, and social classes can never ensure development of nations in the long run. ‘Rob the rich and feed the poor’ governments only feed themselves. If you have any doubts, consult history.

·        Hang your priests from the nearest lamppost if they try to get in the way of assimilating industrial technologies or forms of social and political organization that help with adapting in the changing world.

·        Recognize that the task of a less-productive economy is to imitate rather than innovate, for there will be ample time for innovation after catching-up to the production standards of the industrial core. We should concentrate on developing our agriculture, manufacturing, and basic infrastructure before trying to be world leaders in cutting edge technologies.

·        Recognize that things change and that we need to change with them, so that the mere fact that a set of practices has been successful or comfortable in the past is not an argument for its maintenance into the future. It is high time we looked at our traditions in a new light and evaluate whether they help us or hinder our economic development.

·        There is no reason to think that what is in the interest of today's elite--whether a political, religious, or economic elite--is in the public interest, or even in the interest of the elite's grandchildren. We ought to adopt a long-term perspective to prosper as a nation.