along with his colleague from the Massachusetts Institute of Technology (MIT) Simon Johnson and James Robison, from the University of Chicago. The award recognizes his studies into why some nations are richer than others. He speaks with EL PAÍS through the Zoom application and maintains that an independent judiciary and well-enforced property rights are essential for progress.
Furthermore, he argues that events that occurred centuries ago still affect economic results today. , the highest rank that can be granted to a faculty member. Their economic position is clear: “inclusive institutions promote well-being” and “extractive ones, which concentrate power and resources in few hands, lead to economic stagnation.” His award was one of those sung. Perhaps not so much for his findings, but for the courage to confront some of the most important questions in his discipline. According to Research Papers in Economics—a kind of great library of this science—it is .
Ask. He is co-author of one of the greatest best sellers economics of our time: Why countries fail (Deusto). The book was published a decade ago, in 2013. What would you change?
Answer. The truth is that it was written in 2010. It was almost 15 years ago. The world has changed. But not the essential message of the book. We have seen how other experts contributed additions. In The narrow hallway We delve into the capacity of the State, into cultural issues, and we also discuss in great detail why current democracies still continue to fail. In 2023 we take in technology, technological change and the direction it was taking, and look at why many technologies threaten institutions and prosperity.
P. In his 2019 article Democracy Does Cause Growth (democracy produces growth) you and your co-authors pointed out that growth was associated with democratic institutions. What mechanism is behind it?
R. There are several. Different decisions work in a different way. But the general data is very clear: democracy spends more on training and health. This system is investing more in workers’ education and health. It also helps eliminate distortions such as monopolies, which are often associated with dictatorial regimes or boards. [usa el español]. They are the mechanisms that lead democracies to achieve better results.
P. One of the bases of his thinking is that judicial independence is linked to economic prosperity. In Spain, this situation has been in doubt for years. How does it affect economic growth?
R. Legal institutions are very important. Small problems in the system can undermine them. When Justice loses its independence and becomes a political instrument, as in China, then serious consequences appear. For me, the greatest threat lies at the moment in which the judicial system becomes an instrument in the hands of the Executive Branch. For example, this is a real threat in Israel. October 7, 2023 [ataque de Hamás a Israel] changed the situation and priorities. But I believe that the reforms of his prime minister, Benjamin Netanyahu, put judicial independence at risk.
P. In his 2023 book, Power and Progress (Power and progress, Deusto), writes that artificial intelligence (AI) can weaken democracy.
R. There are two sides to me. First, the effect on institutions in general, including democracies. Artificial intelligence is the compilation of other digital technologies and this increases inequality. Greater inequality makes democracy more difficult, increases social tension and polarization. We see it in industrialized countries. But AI also changes the way we communicate. Groups are being created in civil society whose objective is to obstruct political action.
P. AI, ChatGPT, quantum computing. Has humanity lost its way?
R. I wouldn’t say we’ve lost our way, yet. Because all the technologies you have mentioned, if developed appropriately, can become tools in the hands of humanity. AI could help people perform their tasks better. But either AI is controlled by a few tech companies and they become the masters of knowledge and silence the workers, then we have truly lost our way.
P. Average incomes have never been higher in the West than they are today. Should we ask ourselves where all this wealth comes from?
R. For me it is not the right question. It’s another. Humanity has had spectacular growth in recent decades. Why hasn’t it grown much more? They have a fifth of the GDP of Spain or the United States. Why do they have so few resources? Why haven’t they grown? Political failure, market failure, economic failure. Even in the industrialized world. If you look at patents, for example, their number is higher than ever, but productivity is lower than before. There is a flaw: we should grow faster. Of course, respecting natural resources and the environment. It is possible, but it is not what we are doing now.
P. Have big technology companies fueled inequality?
R. Of course we have a global crisis of inequality. In the United States there are many billionaires and the real salary of workers has fallen. There is a huge fracture if we compare the top and bottom. Technology has the capacity to increase the distance between the rich world and the poor. But I don’t think it always has to be that way. New technologies, including digital technologies, can be an engine of growth in Indonesia, India, Vietnam, Türkiye, Mexico. They could help bridge the gap between the global north and the global south. But for that we need them to focus on increasing the productivity, diversity and increasing the knowledge of workers in those nations. They must be tools in your hands.
P. “Rethinking capitalism.” This is one of the phrases that marks our era.
R. Capitalism is a term I don’t use because it means very different things, depending on the person you talk to. Capitalism in the United States is quite different from that in Sweden. What I agree on is the need to rethink the market. Any system that follows the guidelines of North Korea or the former Soviet Union is going to fail badly. But we have to rethink it because the market without proper regulation does not work either. For me, better expressions are: “Rethink the market economy” or “rethink the future of prosperity.”
