1. Report on “ Colonial Origins of Comparative Development…” by D. Acemoglu, S. Johnson, J. Robinson Maxim Ananyev New Economic School MAE, class 2012

2. Does the difference in institutions cause large difference in per capita income between countries?

3. Institutions matter.

4. Two (somewhat) contradicting opinions : Good institutions cause economic growth OR Rich countries develop better institutions

5. How to isolate the impact of institutions? Look at the countries, where the institutions had been established exogenously i.e. former colonies

7. AJR Historical Hypothesis Mortality Settlements Modern institutions Early institutions

8. Low mortality rate – key determinant of where to settle Where should the pilgrims go? Guyana United States Where to send convicts? Gambia River Australia

12. OLS: Wealth and Institutions y – current per-capita GDP R – current institutions

13. Institutions and wealth

15. It is better to look at settlers mortality rates The main causes of settler mortality - malaria and yellow fever – did not hurt local population as much They did not influence local economy – only the institutions imposed by the foreigners.

16. Least-squares estimates R - current institutions C - early institutions S - settlements M - mortality rate

17. In Simple English: Current institutions depend on early institutions. Early institutions depend on the European settlements European settlements depend on mortality rate

18. Current institutions depend on early institutions Dependant variable is protection against expropriation risk in 1985 - 1995

19. Early institutions depend on European settlements Dependant variable is constraint on executive in 1900

20. European settlements depend on mortality rate Dependant variable is European settlements in 1900

21. Current institutions depend on mortality rate Dependant variable is protection against expropriation risk in 1985 - 1995

23. Conclusion This findings reveal that colonial regime is one of the important factors that determine modern institutions and wealth of nations.