Paths/Development Economics/Foundations of Development Economics
Module 1.250 min

Colonial Origins and Institutional Persistence

Colonial powers created different institutions depending on local conditions—and these differences persist centuries later.

Learning Outcome

Explain how colonial institutions created path dependencies that persist today.

Core Teachings

Key concepts with source texts

This clever research design solves the chicken-and-egg problem: do good institutions cause prosperity, or does prosperity enable good institutions? Settler mortality affected institutions but couldn't directly affect modern income (except through institutions).

From the Source Texts

"In places where the disease environment made it difficult for Europeans to survive, they set up extractive states with the intention of transferring resources to the metropole."
The Colonial Origins of Comparative Development (2001)Translation: Acemoglu, Johnson & Robinson

Commentary

This insight won the authors the 2024 Nobel Prize—they found a way to prove causation, not just correlation.

Deep Dive

Why This Matters

Understanding institutional persistence explains why development is so difficult—you're fighting against centuries of institutional path dependence.

Study Materials

Primary sources with guided reading

WatchYouTube

How Europe Became So Rich | Prof. Joel Mokyr

45 min

Joel Mokyr (2025 Nobel laureate) explains why Europe specifically developed—complementing the institutions story with the role of competitive states and the Republic of Letters.

Additional Resources

Reversal of Fortune: Geography and Developmentoptional

Acemoglu & Robinson's paper documenting the reversal of fortune among former colonies.

Reflection & Critical Thinking

Write your thoughts before revealing answers

Consider these points:

  • What type of colonial institutions did each receive?
  • What role did post-independence leadership play?
  • How did each country's institutions evolve?

Your Thoughts

Writing your thoughts first will deepen your understanding

AI Bridge Notes

Bridge notes help connect the resources and show how they relate to the learning outcome.

AI-generated notes synthesize the lesson outcome and resource summaries. Human-reviewed before publishing.

Knowledge CheckTest your understanding

Why did Acemoglu, Johnson & Robinson use settler mortality as an instrumental variable?