Is Foreign Aid a Source of Ills?

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I remember a reporter once asked me if i was in favor of sending money abroad a help build schools. I mean, who could be against that? And i said, we can't even figure out how to spend money in our own country to increase education. Even if a lot of it gets wasted, ten cents worh 20 cents, is not so bad. Who are my clothes to if i take easterly verses sacks? Of course, i'm much closer to easterli. But i think ina foreign aid iis a source of ills.

Daron Acemoglu of MIT and author (with James Robinson) of Why Nations Fail talks with EconTalk host Russ Roberts about the ideas in his book: why some nations fail and others succeed, why some nations grow over time and sustain that growth, while others grow and then stagnate. Acemoglu draws on an exceptionally rich set of examples over space and time to argue that differences in institutions--political governance and the inclusiveness of the political and economic system--explain the differences in economics success across nations and over time. Acemoglu also discusses how institutions evolve and the critical role institutional change plays in economic success or failure. Along the way, he explains why previous explanations for national economic success are inadequate. The conversation closes with a discussion of the implications of the arguments for foreign aid and attempts by the wealthy nations to help nations that are poor.