Why Some Countries Are Poor and Others Rich
Summary
TLDRThis script explores the factors influencing a nation's wealth, highlighting three key determinants: institutions, culture, and geography. It underscores the importance of good institutions in reducing corruption and enabling growth, the impact of cultural beliefs on economic development, and the challenges posed by tropical climates and landlocked locations. The summary also touches on the paradoxical effects of natural resources and suggests a distribution of influence among the factors, urging a nuanced understanding of the complex issues faced by poor countries.
Takeaways
- π There are 196 countries in the world, with 25 being very rich, defined by an average wealth per person of over $100,000 a year.
- π° The 20 poorest countries have a per capita wealth under $1,000 a year, equating to less than $3 a day.
- π Growth rates vary significantly, with some countries like Zimbabwe projected to become rich in 722 years at their current rate.
- π€ The script seeks to understand why some countries prosper while others stagnate, focusing on the factors that contribute to this disparity.
- ποΈ Institutions are crucial, with rich countries generally having good ones and poor countries having very bad ones, directly correlating with corruption levels.
- πΌ Corruption prevents the collection of sufficient taxes, hindering the development of essential services like education, health, and transport.
- π§ Clan-based thinking in poor countries leads to nepotism, limiting access to the intelligence and talent of the entire population.
- π Culture plays a role, with a correlation between wealth and the importance of religion to a population; less religious countries tend to be wealthier.
- π‘οΈ Geography affects wealth, with poor countries often located in tropical regions where agriculture and disease present significant challenges.
- π’ Connectivity is key, with landlocked countries facing disadvantages in trade and transportation.
- π³ Natural resources can be a curse for countries with poor institutions, leading to the 'resource trap' and exacerbating corruption and conflict.
Q & A
How many countries are there in the world according to the transcript?
-According to the transcript, there are a hundred and ninety-six countries in the world.
What is the average wealth per person defined as 'very rich' in the transcript?
-In the transcript, 'very rich' is defined as having an average wealth per person of over $100,000 a year.
What is the per capita wealth of the 20 poorest countries mentioned in the script?
-The per capita wealth of the 20 poorest countries is under $1,000 a year or under 3 dollars a day.
How long will it take for Zimbabwe to become a rich country if it continues at its current growth rate, as stated in the transcript?
-If Zimbabwe continues at its current growth rate, it will qualify as a rich country in two thousand seven hundred and twenty-two years.
What are the three factors that determine whether a country will be rich or poor according to the transcript?
-The three factors determining a country's wealth are institutions, culture, and geography.
Why are institutions considered beyond important for a country's wealth according to the transcript?
-Institutions are considered beyond important because they are directly correlated with poverty and corruption; rich countries have good institutions, while poor ones have very bad ones.
What is the correlation between corruption and the ability to collect taxes in poor countries as mentioned in the transcript?
-The transcript mentions that when countries are corrupt, they can't collect enough taxes to get the good institutions they would need to escape the poverty trap.
How does the transcript describe the impact of clan-based thinking on a country's ability to access the intelligence and talent of the whole population?
-The transcript describes clan-based thinking as a barrier to accessing the intelligence and talent of the whole population because it prioritizes hiring people from one's own group over the best candidate.
What is the general relationship between religiosity and wealth as stated in the transcript?
-The transcript states that there is a general relationship where the less people believe (in religion), the richer they stand a chance of being.
Why does the transcript suggest that belief in religion might be detrimental to wealth creation?
-The transcript suggests that belief in religion might be detrimental to wealth creation because religiosity is often connected with the idea that the here-and-now can't be improved, leading people to focus on the spiritual rather than material improvement.
What is the role of geography in determining the wealth of nations according to the transcript?
-According to the transcript, geography plays a significant role in determining the wealth of nations as poor countries are often located in tropical regions with challenges in agriculture, disease, transport, and natural resources.
How does the transcript explain the paradoxical impact of natural resources on poor countries?
-The transcript explains that natural resources can be a paradoxical trouble for poor countries because they can intensify the wealth of countries with good institutions but make countries with bad institutions even poorer, leading to a 'resource trap'.
What is the suggested distribution of factors determining the wealth of nations in the transcript?
-The transcript suggests that 50% of a nation's wealth comes from its institutions, 20% from its culture, and 10% each from latitude, connectivity with the rest of the world, and geological resources.
Outlines
π Wealth Disparity and Growth Factors
This paragraph discusses the stark contrast between the world's richest and poorest countries, highlighting the slow growth of the latter. It emphasizes the importance of institutions, noting that corruption is a direct indicator of poverty. The correlation between wealth and religious beliefs is also explored, suggesting that less religious societies tend to be wealthier. Additionally, the paragraph touches on the challenges posed by tropical geography, including agricultural difficulties and the impact of diseases, which contribute to the wealth gap.
π± Geographical and Cultural Impacts on Economic Development
The second paragraph delves deeper into the geographical and cultural factors affecting a nation's wealth. It explains how the climate, particularly in tropical regions, affects agricultural productivity and the prevalence of diseases that hinder development. The paragraph also addresses the disadvantages faced by landlocked countries in terms of trade and connectivity. Furthermore, it examines the paradoxical impact of natural resources, which can either intensify wealth or poverty depending on the quality of a nation's institutions. The summary concludes with an estimation of the relative importance of institutions, culture, geography, and other factors in determining a nation's wealth.
Mindmap
Keywords
π‘Countries
π‘Wealth
π‘Institutions
π‘Corruption
π‘Clan Based Thinking
π‘Culture
π‘Religiosity
π‘Geography
π‘Tropical Diseases
π‘Natural Resources
π‘Policymaker
Highlights
There are 196 countries in the world, with 25 being very rich, defined by an average wealth per person of over $100,000 a year.
The 20 poorest countries have a per capita wealth under $1,000 a year, equating to less than $3 a day.
Countries are on paths to growth, but the poor ones grow very slowly; Zimbabwe will take 722 years to become rich at its current rate.
Three main factors determine a country's wealth: institutions, culture, and geography.
Good institutions are crucial for a country's wealth; rich countries have them, and poor ones suffer from very bad ones.
Corruption is directly correlated with poverty, and the most corrupt countries are also the poorest.
Clan-based thinking in poor countries leads to hiring within one's own group rather than the best candidate.
Religion's importance to people inversely correlates with a country's wealth, with 19 of the richest having 70% or more of the population valuing religion less.
The United States is an exception, combining great religiosity with wealth due to its specific, materialistic form of Protestantism.
Geography plays a significant role in wealth, with poor countries often located in the tropics where life is tougher.
Tropical regions have agricultural disadvantages, including less nutritious plants and poor soil.
Tropical climates can hinder photosynthesis, affecting the ability to develop technology and increase agricultural productivity.
The presence of the tsetse fly in Africa has devastated domesticated animals, impacting technological and agricultural development.
Tropical diseases affect all low-income countries, with many facing at least five simultaneously.
An optimal temperature of 16 degrees Celsius is beneficial for civilization, but poor countries are often in warmer climates.
Poor countries are often landlocked or poorly connected, affecting trade and economic growth.
Natural resources can be a curse for poor countries, leading to the 'resource trap' and exacerbating corruption.
The Democratic Republic of the Congo, rich in minerals, suffers from armed conflict and corruption due to its natural resources.
A suggested distribution of factors influencing a nation's wealth is 50% institutions, 20% culture, 10% latitude, 10% connectivity, and the rest to other factors.
Policymakers should consider these factors for practical implications, while individuals should develop modesty and sympathy for struggling societies.
Transcripts
there are a hundred and ninety six
countries in the world twenty-five of
them are very rich defined as having an
average wealth per person of over
$100,000 a year they are but far more
countries are quite poor and some which
we're considering here a very very poor
these are the 20 poorest countries in
the world where the per capita wealth is
under $1,000 a year or under 3 dollars a
day every country is now more or less on
a path to growth but the poor ones are
growing very very slowly
if Zimbabwe continues at its current
growth rate it will qualify as a rich
country in two thousand seven hundred
and twenty two years what we want to
know in this film is why some countries
prosper and others stagnate so that we
can understand what rich countries are
doing right and get a better grip on the
challenges and hurdles facing poor
countries there are basically three
factors that determine whether a country
will be rich or poor the first is
institutions institutions are beyond
important
broadly speaking rich countries have
good institutions and poor ones have
very very bad ones the correlation
between poverty and corruption is direct
the richest countries in the world are
quite simply invariably also the least
corrupt ones and the most corrupt
countries are also the poorest when
countries are corrupt they can't collect
enough taxes to get the good
institutions they would need to escape
the poverty trap half of the wealth of
the world's poorest 20 countries those
into offshore accounts lost revenues in
these countries totals between 10 and 20
billion dollars a year meanwhile without
an adequate tax base poor countries
can't invest in police education health
and transport now a more generous way to
look at corruption is that it's really a
case of clan based thinking so you're
hiring someone in the rich countries
you're meant to do so simply on their it
interviewing lots of candidates then
picking the best one irrespective of any
personal connection but in poor
countries under the sway of clan based
thinking that approach would itself be
seen as corrupt it's your duty to
disregard the so called best candidate
from an anonymous bunch in
to pick someone from your own team your
uncle your brother your second cousin
the guys from the same tribe as a result
poor countries don't allow themselves
access to the intelligence and talent of
the whole population there's a second
thing that keeps countries poor culture
what goes on in people's minds their
outlooks and beliefs a striking
statistic pops up here in relation to
religion
if there's one generalization you can
make about religion and wealth it's that
the less people believe the richer they
stand a chance of being 19 of the
richest countries in the world have 70%
or more of their populations saying that
religion is not at all important to them
the exception here is unsurprisingly the
United States which manages to combine
great religiosity with huge wealth more
on that in a second and conversely the
poorest nations in the world are also
extremely believing once here's how many
people think religion in the
supernatural is deeply important in the
following countries in the world's
poorest country simply everyone is a
believer why is belief quite so bad for
wealth creation because in general
religiosity is connected up with the
idea that the here-and-now can't be
improved so you should focus on the
spiritual and look forward to a next
world instead it makes quite a bit of
sense when you live here in the rich
world on the other hand people are
generally great believers in their
capacity to alter their destiny through
effort and talent incidentally to
explain the anomaly of the United States
religion seems not to slow down economic
growth here because it's a particular
sort of religion an overwhelmingly
Protestant and exceptionally
materialistic kind the American God
doesn't want you to think of building
the New Jerusalem in the next world he
wants it here and now in Kansas or
Houston there's another big factor that
determines the wealth and poverty of
Nations geography poor countries are
overwhelmingly located in the tropical
regions this isn't a coincidence life is
in many ways simply far far tougher
there
the problems begin with agriculture
tropical plants are generally a lot less
packed with carbohydrates poor countries
have worse soil - also in
surprisingly a tropical climate can be
disadvantageous to photosynthesis
historically a key determinant in the
likelihood of societies growing rich was
their possession of large domesticated
animals such as horses and oxen which
liberated a huge part of the workforce
from having to plow by hand but in
tropical Africa domesticated animals
have throughout time been devastated by
a further appalling scourge that sits a
fly this small fly exclusively present
in Africa because of its heat and
humidity knocks out animals on an
enormous scale making them sleepy or
inactive and has had a profound effect
on the ability of Africans to develop
technology increase agricultural
productivity and amass wealth
it isn't just plants and animals that
suffer in the tropics in the middle
latitudes humans are open to a
terrifying array of diseases including
hundred percent of low income countries
are affected by at least five tropical
diseases simultaneously the magical
temperature which has helped to make
rich countries rich is 16 degrees
centigrade however superficially
unpleasant that drop below 16 degrees as
autumn starts to bite is quite literally
a foundation stone of civilization
geography also encompasses transport and
poor countries are on the whole very
badly connected landlocked Bolivia and
semi landlocked Paraguay are the poorest
nations in South America Africa has only
one major navigable river the Nile and
hosts fifteen landlocked nations eleven
of which have average incomes for six
hundred dollars a year or less not
coincidentally the poorest country in
Asia Afghanistan is also landlocked then
there's the matter of natural resources
natural resources like oil or precious
metals can be real trouble and
paradoxically poor countries tend to
have them in spades these natural
resources are what economists call
intensifiers they will help to make a
country with good institutions richer
but one with bad institutions get even
poorer precipitating what's called the
resources trap so the Democratic
Republic of the Congo is one of the
world's most mineral rich countries
holding most of the world's coltan which
every mobile phone has a bit of inside
but natural resource wealth helps elite
to grab money without requiring the
cooperation of the whole society if the
only way to grow wealthy is to assemble
high-tech aero engines for example
you're going to need your whole society
to buy into the project but if you just
need to extract a few minerals you can
do so with a small labor force some guns
and an airstrip long enough to ferry
your loot out to market the wealth from
coltan keeps DRC armed rebels and guns
and corrupt every level of society so
how should one way ask the relative
importance of all these different
factors institutional cultural and
geographic in determining the wealth of
nations there's no hard and fast rules
but as a guide one can suggest that 50%
of the nation's wealth comes down to the
state of its institutions 20% is due to
its culture and 10% each can be
allocated to latitude connectivity with
the rest of the world and geological
disclosure if you're a policymaker this
discussion has wide practical
implications but at a more personal
level one might take away two things
from it firstly modesty you should have
a better idea of what you are your
individual success 2 which is not so
much your own hard work or fine mind as
the broader society you live in which
was produced over centuries and which
you natural benefit from unknowingly at
the same time sympathy an ability not to
see failing societies just as basket
cases but rather as countries facing
comprehensible and hugely difficult
problems our sympathy can be enhanced by
reflecting that the troubles of
desperate lands are to a considerable
extent to do with malaria a lack of
navigable river and horrific buzzing a
dead City fly rather than always some
more intimate human failing which we
would ourselves never manifest
you
you
you
Browse More Related Video
Puzzle of Growth: Rich Countries and Poor Countries
Understanding Population Dynamics [AP Human Geography Review Unit 2 Topic 4]
Dimensions of Development - Francis Fukuyama
Pengertian dan Penjelasan tentang Manusia dan Kebudayaan | Materi ISBD
The Eight Key Determinants of Foreign Policy | International Relations | The Alalibo Lectures
Why Whites Are Rich and Blacks Poor - Thomas Sowell || Redistribution of Wealth
5.0 / 5 (0 votes)