Why Nations Fail

Private property rights must be protected, contract law must be upheld, public infrastructure and education must be provided, and the state must be governed by its people. In less developed nations, extractive institutions create a cycle of poverty and failing states. Today's inequality is unprecedented, and solid institutions and incentives are essential to prosperity. Egypt, North Korea, Sierra Leone, and Zimbabwe are impoverished because they are governed by a small elite, while Japan, Botswana, the United States, and Great Britain are prosperous because their populations ousted leaders and established societies with more inclusive political and economic prospects. Global development is dependent on a political infrastructure that allows for a diversity of opinions and income distribution.