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Israeli's Advantage Over Palestine: Not Culture!

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One of the greatest stars in modern economics is Darron Acemoglu (right picture), who wrote Why Nations Fail with Harvard political scientist James Robinson. Commenting on Mitt Romney’s quip that Israel has a more productive ‘culture’ than Palestine, Robinson’s notes: “Mitt is confused.” The article interviews these experts who point out the true culprits: human capital, institutions, elites, and government corruption.

That’s academic insight for you. In their minds, culture has nothing to do with human capital, elites and institutions, which as the post-colonial Africa demonstrated, are pretty much exogenous (joke!). No wonder ‘young stars’ say things like ‘firms seem to be unproductive in large part because of bad management.’

Of course, these were the guys that admitted they had no clue why the Dominican Republic has outperformed Haiti over the past century. I say macroeconomists should not expect to be taken seriously as scientific specialists until they come to a consensus on that, because if they can’t explain the past on a case that has a 5-fold income differential, why should I expect them to predict things that will add or subtract 1% from GDP growth next year?



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