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  • Why the West Got Rich, part 1/N: War In my last post, “Why the Middle East Fell Behind,” I overviewed what I believe to be two of the most convincing theories of why the Middle East fell behind ...
    Posted Mar 28, 2017, 10:13 AM by Jared Rubin
  • Why the Middle East Fell Behind One of the great questions in economic history – indeed, in all of economics – is “What Caused the Rise of the West?” The converse of that question is equally interesting: “Why ...
    Posted Feb 15, 2017, 12:43 PM by Jared Rubin
  • Popularity vs. Legitimacy and Why It Matters (in the Age of Trump) My previous two (and only) posts (here and here) centered around the concept of political legitimacy. One of the key takeaways from these posts is that thinking through how rulers ...
    Posted Feb 8, 2017, 9:46 AM by Jared Rubin
  • Why do Rulers Follow the Rule of Law? Thoughts on Trump, Erdoğan, and History It is astonishing how quickly the U.S. has been set on a path where the rule of law no longer exists as a cornerstone of governance. As Mark Koyama ...
    Posted Jan 31, 2017, 11:44 AM by Jared Rubin
  • Do Political Institutions Still Rule? Thoughts on Acemoglu and Trump Let me begin by saying that I think few people have done more for economic history over the last two decades than Daron Acemoglu (and by extension James Robinson and ...
    Posted Jan 26, 2017, 3:37 PM by Jared Rubin
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Why the West Got Rich, part 1/N: War

posted Mar 28, 2017, 10:07 AM by Jared Rubin   [ updated Mar 28, 2017, 10:13 AM ]

In my last post, “Why the Middle East Fell Behind,” I overviewed what I believe to be two of the most convincing theories of why the Middle East fell behind Western Europe economically, scientifically, militarily, and technologically. The two theories, one put forth by Timur Kuran and the other put forth by myself, focus primarily on aspects of Middle Eastern political and legal institutions which helped to retard economic growth in the region.

Much more ink has been spilled on the converse question: “Why did the West get rich?” This is really the more appropriate question to ask. Modern economic growth was a unique phenomenon when it first arose in northwestern Europe. Meanwhile, the relative stagnation of the Middle East (and India or China) was hardly an aberration from historical norms. So the real story is one about the West pulling ahead, not the “rest” falling behind (and yes, most of my book addresses Western Europe pulling ahead, not just the Middle East falling behind).

Since the “rise of the West” is the topic of a lively debate, I thought it would be useful to lay out some of the theories that I find convincing, while pointing out where they fall in line with other theories. First things first. The “rise of the West” or the relative stagnation of some other part of the world is a multi-causal event. Due to the nature of academic work, however, most of the best works focus primarily on one cause – my own work included. This means that there is plenty of room for multiple theories to be correct, and I find many of the works discussed below convincing.

This is the reason I included in the title of this post part 1/N. It will certainly take a few posts to adequately summarize the many views that I find convincing. I will try to break these down into themes, which is not as straight-forward as it sounds. These themes will definitely include the subject of this post – war – as well as political institutions and culture. So maybe N will equal 3. But I also may be tempted to write on causes that I do not believe are prime movers, such as colonization, geography, and certain aspects of culture. All of these take a lot of fleshing out and are worthy of individual posts. I’d like to get to them if I have time.

The theme of this post is war. Prior to the 19th century, Europeans were almost constantly at war with each other. How could this possibly be a good thing for economic growth? As many historians and economists have pointed out, the answer lies in the simple fact that wars require money. And acquiring money generally requires the capacity to tax (the term used in this literature is “fiscal capacity”). This is a difficult problem to solve. People generally don’t like paying taxes unless they feel like they are getting something in return (and even then, a major free rider problem exists if it is difficult to enforce punishment of tax evaders). Solving this problem requires institutions that align the incentives of the relevant players: rulers, those who collect the taxes, and those who pay the taxes. Once this problem is solved, however, the state generally has to provide something besides just war – public goods such as transport networks, education, and infrastructure – in order to convince people to pay taxes. Perhaps more importantly, fiscal capacity does not arise in a vacuum. It generally is associated with greater “state capacity”, which is simply the state’s ability to implement policy, render justice, protect its citizens, and so on. So the argument goes war à state or fiscal capacity à long run growth.

Noel Johnson and Mark Koyama have an excellent recent survey on state capacity. They obviously go into much greater depth than I will here, but my point is not to simply recapitulate what they say. My ultimate goal is to place this and other literatures pertaining to the “rise of the West” in a broader context, looking for complementarities in the arguments and pointing out shortcomings where they arise.

It may seem perverse that war could be a good thing – and it certainly was not for those who lived through it – but the argument does make a certain amount of sense. Without institutions to facilitate tax collection, it will be hard to convince people to pay taxes. And setting up these institutions is expensive. So it’s only worth it when there is a great need for tax revenue. That is the view, which I buy, of Besley and Persson.

The dominant figure in this literature is Charles Tilly. His great statement “War made the state, and the state made war” quite succinctly summarizes the view taken on by many in this literature. His book, Coercion, Capital and European States, A.D. 990-1992 argues that there were three paths that modern European states took to become nation-states: a “coercive-intensive” path, a “capital-intensive” path, and a mix between the two.

The coercive intensive path, taken by the large eastern and central European empires of the Habsburgs, Russians, and Poles, was built from and for war. As war machines became stronger, they were able to exert force over a greater expanse of people and demand tax revenue from them. This, however, did not lead to great long run economic outcomes because there was little incentive for individuals to invest in capital in such a regime.

On the other extreme, states on the “capital-intensive” path, taken by many of the city-states of northern Italy, central Europe, and the Low Countries, expanded as their wealth expanded. They generally protected the rights of their citizens, especially those engaging in commerce, and they were thus able to collect tax revenue from the economic elite in return for protections. This view is seconded by David Stasavage in his great book States of Credit, which argues that these small city-states were able to borrow at relatively low rates precisely because they were run by merchants for merchants; these merchants had a vested interest in maintaining the credit-worthiness of the state, and thus the risk of default was low. This is an important finding; access to credit is a necessary feature of the modern state; absent some natural resource windfall, it is impossible to think of a modern state functioning well without the capacity to borrow. Yet, as Stasavage points out in a more recent work, when certain groups dominate the political scene for too long, vested interests eventually undermine further growth, as the world changes in ways that do not benefit those in power. I also argue in my book that this is the most likely reason the Dutch were unable to keep their economic lead of the 16th and 17th centuries and were late to the industrialization game (note: I am not the first to make this argument).

So, for Tilly, the path to the modern economy lay in those states (well, England … but also to a lesser extent France) that employed some hybrid model of coercion and capital intensivity. These states were able to encourage capital accumulation while also acquiring the capacity to tax large swaths of their population. And those with capital were willing to provide taxes in return for protection of their property rights, which states partially built on coercion was able to provide. There are certainly a lot of blanks that need to be filled in here – a job taken on by the likes of Mark Dincecco, Kivanç Karaman and Şevket Pamuk, Lisa Blaydes and Eric Chaney, Nicola Gennailo and Hans-Joachim Voth, among many others –  but there is a certain amount of sense to this argument, and I buy most of it.

Phil Hoffman present a slightly modified version of the Tilly thesis in his recent book, Why Did Europe Conquer the World?, which builds off insights laid out in Paul Kennedy’s The Rise and Fall of the Great Powers. This thesis also focuses on incessant European warfare as a prime mover of European economic success, but instead of emphasizing its role in state formation, it stresses the role that warfare played in encouraging innovation in military technology. These technological advances, especially when combined with gunpowder, gave Europe a massive upper hand in colonizing the rest of the world via brute force. This too seems like a reasonable argument and I do think that colonization and coercion played an important role in exacerbating the divergence between the “West and the rest” (although, for reasons I hope to get to in a future post, I do not think that colonization is a prime mover).

So, as I see it, there are two paths through which the European lust for war in the medieval and early modern periods unwittingly set it up for success in the long run: by encouraging state formation (and the fiscal capacity associated with it) and spurring innovation in military technology. Both of these are important parts of the divergence story, and – like any good explanation should – they focus on something that was (relatively) unique about Europe.

While war was hardly unique to Europe, Europeans did seem to fight each other much more than most other parts of the world. The common explanation given for why this was the case is that Europe was more fractionalized than the rest of the world. Following the fall of the Western Roman Empire in the fifth century, no power has ever held domain over large swaths of Europe (save very brief interludes under Charlemagne, Napoleon, and Hitler). Meanwhile, China was with some exceptions ruled under large empires, as were large swaths of the Middle East (well, except for the 9th-15th centuries, but who’s counting?). This meant that while these great ‘empires’ fought wars of conquest and regularly attempted to push their boundaries, they were relatively insulated from direct threats to their power. Meanwhile, France, Spain, England, Venice, the Holy Roman Empire, and the other European powers were often at each other’s throats, causing them to build up state capacity and invest in military technology.

All of this seems reasonable to me, but I am left unsatisfied on two fronts (and these are where I think other explanations do a better job). The first is that I have yet to see a convincing reason why Europe was so fractionalized in the first place. Understanding this is key, because it is the reason claimed in this literature why Europeans were so frequently at war. The most convincing explanation I have seen is the one recently presented by Chiu Yu Ko, Mark Koyama, and Tuan-Hwee Sng, which argues that the relative political unity of China stems from it facing a unidirectional threat from the Eurasian (Mongol) steppes, which encouraged the formation of a vast state that could gather resources to defend against that threat. On the other hand, medieval Europeans faced threats from all directions (Vikings and Muslims and Magyars, oh my), which encouraged decentralized states capable of fending off attacks from one of the directions. There is something to this, and I think it helps explains why the “divided Europe, unified China” equilibrium remained an equilibrium for centuries.

But did it have to be this way? Wasn’t the Roman Empire able to conquer a large part of the continent despite also facing threats on their northern and eastern flanks (the latter in part from those same steppe peoples who tortured Chinese Empires)? There seems nothing inevitable about European fractionalization to me. If you want to claim it was an historical accident, that is fine, but I’m not sure I’d buy that either. Maybe there is something about the way post-Roman European governments formed that discouraged large, centralized states? Certainly the spread of the feudal system played a role, but why was no ruler ever successful in conquering Europe? I think the answer lies in part in how European rulers were legitimized (the topic of my book!), but that is fodder for a future post.

Moreover, Europe was hardly the only part of the world in which government was decentralized. The Middle East was highly fractionalized between the decline of the Abbasid Empire in the 9th century to the rise of the Ottomans in the 15th century. India, likewise, has been highly fractionalized for most of its history. So, even if we accept that the “natural state” for Europe is fractionalization and the “natural state” for China is unity (and I am skeptical on this), it is still not clear what was so special about Europe vis-à-vis the Middle East or India. And, importantly, Middle Eastern and South Asian civilizations were well ahead of Europe for centuries following the fall of the Roman Empire. So it’s not as if I’m cherry-picking some fractionalized region of the world that had no chance of birthing the modern economy (such as the modern U.S. prior to 1500). Again, this is not to say that war was not an important part of the story – it simply entails that there is more to it than that.

The second issue I have with the “war argument” is that it is tough to reconcile with the fact that modern economic growth was not a “Europe thing” – it was very much a “northwestern Europe (read: English and Dutch) thing”. By the late 19th century, northern Italian economies were much closer to China than they were to northwestern Europe. And I see little reason why the “war to state capacity and/or military technology to economic success” argument should be confined to northwestern Europe. Indeed, the Dutch were less active in intra-European affairs than many of their rivals. The argument has a particular amount of trouble with Spain, which was one of the most frequent combatants but never really improved its fiscal capacity and was not on the forefront of any technological revolution. Now, of course the literature recognizes this; Mark Dincecco, for example, argues that it is the combination of fiscal capacity and executive constraint that matters for growth, and Alejandra Irigoin and Regina Grafe make the case specifically for Spain.

What this suggests to me is that while the war argument has many merits, it needs to be complemented by other arguments for “why the West got rich.” Specifically, we need to understand i) why Europe was so fractionalized in the first place, and ii) why northwestern Europe pulled ahead first. As I noted at the beginning, I think that combining the war argument with ones that look at other aspects of political institutions (especially legitimacy!) and certain aspects of culture paints a more complete story. How these arguments complement each other will be covered (hopefully soon!) in my next post.

Why the Middle East Fell Behind

posted Feb 15, 2017, 12:42 PM by Jared Rubin   [ updated Feb 15, 2017, 12:43 PM ]

One of the great questions in economic history – indeed, in all of economics – is “What Caused the Rise of the West?” The converse of that question is equally interesting: “Why Did X Fall Behind?,” where X could be China, India, or the Middle East (it is a little less interesting why sub-Saharan Africa or the pre-colonization Americas fell behind; here, Jared Diamond’s “geography hypothesis” laid out in Guns, Germs, and Steel is both fascinating and likely correct). One conventional answer to “Why Did X Fall Behind?” is that X never really fell behind; it was Europe and its offshoots that took off. And this to a large extent is true; while European economies grew at unprecedented rates in the 19th century, the Middle East, China, and India largely continued the trajectory that they had been on for millennia, with minimal rates of long run economic growth punctuated with sporadic bursts in per capita income. But this raises the question, “Why Didn’t X Pull Ahead like (northwestern) Europe Did?” Either way you slice it, it is an important question to answer.

Before digging into this question a little further, I want to address one issue: yes, the Middle East did in fact fall behind the West, and no, it has not come close to catching up. This seems like a straw man argument – most people with some knowledge of world affairs and/or history would not deny the basic premise that the Middle East fell behind Europe at some point in the last few centuries, if not before. I wish it were a straw man. And while I do not know of any serious academic works that make this point, I have been approached at enough conferences and over enough unnecessarily aggressive emails that I feel I need to get this out of the way at the beginning. Even with oil wealth – which is a one-time (though multi-generation) boon, there is nothing to suggest that the Middle East is close to the “West” in terms of any measures we generally associate with economic well-being.

Of course, it was not always this way. Under the height of the Abbasid Empire (eighth and ninth centuries), Middle Eastern economies dominated western Eurasia, if not the world. So, the question “Why Did the Middle East Fall Behind?” is no straw man. If we want to know why parts of the world pulled ahead, it is just as useful to know why other parts of the world that were once in a better position to pull ahead did not.

This post is not going to cover all of the reasons why the Middle East fell behind. There are a lot of reasons for the reversal of fortunes between (northwestern) Europe and the Middle East, most of which complement each other. I will discuss what I believe to be the two most important reasons: what I will call Timur Kuran’s “demand side” argument and my “supply side” argument (it is my post after all … of course I think the argument in my book is right!). I will also dismiss one argument which simply cannot account for the main historical facts: what I will call the “weak colonization” argument (as opposed to the “strong colonization” argument; I will define both terms below). I will refrain from discussing many alternative hypotheses which I do think shed some light on the divergence between northwestern Europe and the Middle East. For example, the relative political fractionalization and frequent interstate warfare that embroiled Europe for most of the medieval and early modern periods may have set it up to have greater fiscal capacity than the Middle East (or China). This makes sense to me, and it seems to be part of the explanation. Likewise, differences in family structures (nuclear vs. clan) may have encouraged different types of institutional formation in Europe and the Middle East (or China), with the more individualistic Europeans forming institutions more conducive to inter-group commerce than the more “collective” Middle Easterners. This too makes sense to me, and it was likely an important aspect of the divergence. The point here is that such a large scale event like the divergence between two sets of economies over centuries is almost certainly multi-causal. It is true that these causes all interacted with each other – sometimes as substitutes and other times as complements – and pinning down the direction of these interactions is an important part of the story. But that is indeed another story.

Let’s start by addressing the elephant in the “divergence debate” room: colonization. For the Middle East-Europe comparison, I think it is important to distinguish between what I call the “strong colonization” and “weak colonization” arguments. The “strong colonization” argument, in my view, states that Europe pulled ahead due to its plundering and enslaving various parts of the world (including, later on, the Middle East). A more nuanced version of this argument is found in Kenneth Pomeranz’s excellent The Great Divergence, where Pomeranz argues that the New World gave Europe new markets and raw materials while relieving population pressures. I call this set of hypotheses “strong colonization” because they try to explain why Europe pulled ahead in general – they are not specific to the Middle East. There is a very heated debate on the veracity of the “strong colonization” argument, and it is not one I plan on entering into here.

What I do want to address is what I call the “weak colonization” hypothesis. This is, namely, that European colonization of the Middle East is responsible for the relative economic stagnation of the region. The most common trope among those putting forth this argument is that the carving up of the Middle East under the Sykes-Picot Agreement of 1916 – without regard to tribal, ethnic, or religious identities – set the stage for internal conflicts from which the region has yet to escape. I think this hypothesis is ridiculous. This is not to say that Europeans colonized with the best of intentions or that colonization was even a mixed blessing. Nor is it to deny the fact that the political fallout in the post-colonial Middle East – namely, dictators and princes buoyed with oil money ruling with little regard for the bulk of the population – is a result, either directly or indirectly, of colonization (although Noah Feldman’s The Rise and the Fall of the Islamic State provides an interesting counterpoint, pushing the blame back to the decline of religious authority in the late Ottoman period, as the religious elite were best positioned to check rulers’ powers). The simple point is that the timing does not work. The West was already well ahead of the Middle East by almost any conceivable metric well before it colonized the Middle East. Unlike colonization of the Americas or parts of south and southeast Asia, European colonization of the Middle East commenced well after industrialization and well after a large divergence emerged in wages, capital accumulation, fiscal capacity, military might, technology, science, and so on. So it may certainly correct to say that European colonization of the Middle East exacerbated the divergence (and I buy that this is the case, particularly for the latter half of the 20th century), but it is inconceivable that it was the root cause.

Now let’s turn to the two arguments I like the best for why the Middle East fell behind. Both of these arguments satisfy one key criterion: they explain both why the Middle East pulled ahead for centuries following the spread of Islam and why it ultimately stagnated. The first of these arguments is what I call the “demand side” argument made by Timur Kuran is a series of articles and his stellar book, The Long Divergence. The second is my own “supply side” argument, first made here, and expanded significantly upon in my forthcoming book, Rulers, Religion, and Riches (out in two weeks!). I call these “demand-” and “supply-” side arguments because Kuran’s primary focus is on the demand for change in Islamic law (or lack thereof), and my focus is primarily on the supply of change in law and institutions. We both of course consider the other side (equilibria require understanding both demand and supply-side forces, after all), but our focus is different. I think our two theories complement each other nicely, and combined paint a compelling story for why (in part) the Middle East fell behind.

Let’s start with Kuran’s demand-side hypothesis. Kuran argues that numerous economic aspects of Islamic law served the pre-modern economy well. Among the most important he cites are a relatively egalitarian inheritance law (at least women got something!), simple partnership law (that reflected the simplicity of 7th-century partnerships), and waqf law which facilitated the provision of public goods in perpetuity. These laws were “cutting edge” when first formulated in the 7th-9th centuries and flexibly accommodated the most advanced business practices of the time. Certainly, they were better than anything that was known in the pre-Islamic Middle East or early medieval Western Europe, which was suffering from a long political and economic decline following the fall of the Roman Empire. However, these once cutting edge Islamic laws remained intact long after the conditions under which they were a best response had past. The best example Kuran points to is the lack of the corporation in the Middle East – or any other type of organizational form which incentivizes people to pool their money/capital together for a large enterprise. Kuran argues convincingly that Middle Eastern partnerships remained small and simple well into the early modern (and perhaps even modern) period, well after large enterprises in Europe such as joint-stock companies, and eventually the corporation, permitted the agglomeration of capital beyond what would have been possible without a legal and organizational structure incentivizing the pooling of funds (such as limited liability). Given its head start, why did Middle Eastern partnerships remain simple (i.e., between 2-3 persons for a limited time horizon)? Kuran argues convincingly that the interaction between various types of Islamic laws diminished the demand for more advanced organizational forms, and hence all of the other advancements that come with it, like double-entry bookkeeping. A simple example suffices to explain Kuran’s logic. Imagine a merchant that knows of a big opportunity to trade in a faraway land. He could certainly make much more by pooling capital with many other merchants. But this would be risky because of the interaction of Islamic partnership law, which dictated that partnerships were dissolved at the death of one member, and inheritance law, which split the proceeds of inheritance among many heirs according to a pre-determined formula. Hence, if some of a partner’s heirs decided they needed their inheritance immediately upon that partner's death, the partnership might have to be disbanded, especially if most of the capital was tied up in the goods being traded (as one would expect). One way to avoid this was to avoid taking on many partners (thereby decreasing the probability one partner would die) and keeping the duration of partnerships to one or two voyages.

Kuran’s argument is a demand side one. Because of the constraints placed by Islamic law, Islamic merchants, money-changers, and other commercial elite had little incentive to demand vastly new techniques, or even to adopt more advanced techniques they eventually saw in dealings with Europeans. This lack of demand for change also entailed that none of those other changes associated with a dynamic economy ever occurred – such as more advanced financial instruments, the growth of larger institutions such as banks, or the emergence of a culture more conducive to large-scale borrowing and lending. But even if there were little demand for such changes, there must have been some demand for changes in laws that would have facilitated trade, protected property rights, provided impartial jurisprudence, and all of the other hallmarks of modern states. And such changes could have been beneficial for rulers; they would have expanded the tax base, and the economic elite would have likely been glad to pay those taxes in return for greater legal flexibility and protection of rights. So why did Middle Eastern rulers rarely augment laws in favor of the economic elite in the medieval and early modern periods? In other words, why did the supply of laws pertaining to commerce also remain relatively stagnant after the 10th century or so?

The answer has little to do with the inviolability of Islamic law. Middle Eastern rulers found ways around all sorts of laws, and they often found religious authorities willing to sanction their actions (Ottoman rulers were particularly famous for this). Instead, the answer I propose in my book is that rulers have desires beyond simply increasing tax revenue; above all, they want to stay in power. And, for reasons I delve into in my book, religious legitimacy was a particularly effective way of staying in power in the Islamic Middle East, especially for a ruler who might want to take actions that would otherwise be considered “unIslamic” (such as conquering another Muslim empire). One way to think about this is as a bargaining game: rulers bargain with the players in society that may be able to keep them in power (e.g., religious elite provide legitimacy, military elite provide coercion, economic elite provide revenue, etc.) and the outcome of the bargain is laws and policies. These laws and policies end up reflecting the bargaining power of the relevant players as well as their desires. Since religious legitimacy was particularly effective in the Islamic Middle East, the bargaining power of religious authorities was particularly strong. This actually served Middle Eastern economies well in the centuries following the spread of Islam. Many types of economic transactions fell under the purview of Islamic law, including laws pertaining to contracts, partnerships, and interest. As the religious establishment consolidated in the 8th and 9th centuries, a relatively uniform set of laws emerged under the banner of Islam (in addition to a uniform set of languages and currencies). This occurred over a wide expanse, and as a result the transaction costs associated with conducting trade dropped immensely. In turn, Middle Eastern economies prospered for centuries following the spread of Islam.

Yet, the arrangement where Middle Eastern rulers relied heavily on the religious elite for legitimacy also meant that they were hesitant to take actions that would undermine the religious establishment. This included intruding on the religious establishment’s authority over commercial law. So long as Islam remained a powerful source of legitimacy, the benefits to employing religious legitimacy outweighed its relatively modest costs (i.e., ceding authority over certain aspects of the law) to such a degree that Middle Eastern rulers did not feel the need to bring the economic elite to the bargaining table. Indeed, merchants, money-changers, and others engaged in large scale commerce rarely had political power in the Islamic Middle East. This is certainly true of the Ottoman Empire, where military elites, religious authorities, and local notables were the primary power brokers. One important ramification of this power structure is that the interests of the religious elite were often enacted into law. While their interests were not always antithetical to economic development, they were not necessarily favorable to development either. Importantly, the religious elite strongly desired to maintain purview of Islamic law over as wide a spectrum of life as rulers would permit. Middle Eastern rulers tended to not want Islamic law to dictate taxation, politics, or military activities – all important arenas to rulers who wished to rule effectively, but where their desires often conflicted with religious law. Yet, in return for public legitimizing displays, rulers were generally willing to cede to religious authorities purview over the realms of morality and commerce. Purview over morality and commerce was an immense source of power for the religious elite – indeed, it is an important part of what made them “elite” in the first place. So this arrangement worked for both parties: rulers received a relatively cheap source of legitimacy, and religious authorities received an important source of power and income. The losers in this deal were the economic elite, who found it fruitless to challenge Islamic laws pertaining to commerce. They instead generally focused on finding workarounds to the existing set of laws. Why should they challenge the religious elite, when the ruler was unlikely to support their challenge? And without such a challenge, why would the religious elite modify the laws, when the “eternalness” of religious law is one of their primary sources of authority? In the absence of such challenges, the supply of laws tends to stagnate. Over time, this feeds into Kuran’s argument regarding the stagnation in the demand for changes to Islamic law. If religious and political elites are unlikely to change the law, there is little reason for the economic elite to push for change. Instead, they simply view the laws as constraints, and act as a manner suggested by Kuran’s analysis (e.g., they kept partnerships simple and short in the face of Islamic partnership and inheritance law). The interaction between the demand and supply for changes in laws can therefore explain why Middle Eastern laws and institutions stagnated for centuries despite a changing world. The fact that (northwestern) European institutions ended up being more flexible – for reasons completely consistent with my and Kuran’s arguments – meant that in the long run, the region (Europe) that was once an economic laggard ultimately far surpassed the region that was once far ahead (the Middle East).

The question “Why Did the Middle East Fall Behind?” is a big one. What I have tried to argue here is that it is impossible to answer without a framework for thinking through the determinants of long-run economic development, and it is difficult to provide such a framework without considering the role of politics. On the supply side (of political institutions, laws, and policies), there is little incentive to change if the status quo benefits those in charge. On the demand side, if those people affected by the laws and policies see pushes for change as fruitless, and they are able to find workarounds in any case, demand for change will be low. This has (negative) dynamic consequences. All of those “institutional elements” that are key to the proper working of institutions, but might not be obvious until one has experience living with the institution, will be lacking. In the long run, therefore, what might start as small differences can build on themselves and snowball into much larger differences. Understanding how and why this happens is key to understanding why the Middle East fell behind (although I do not wish to go as far as to say that it sheds significant light on how the Middle East, or other economies, can catch – this is a story for another day).

Popularity vs. Legitimacy and Why It Matters (in the Age of Trump)

posted Feb 8, 2017, 9:46 AM by Jared Rubin   [ updated Feb 8, 2017, 9:46 AM ]

My previous two (and only) posts (here and here) centered around the concept of political legitimacy. One of the key takeaways from these posts is that thinking through how rulers acquire legitimacy can provide insight the manner in which rulers attempt to rule. This is a topic I have spent much of my career thinking about. This concept seems especially pertinent in the age of Trump, so much so that it compelled me to write these posts. The age of Trump is one where, in the absence of a historically-grounded theory for how and why rulers rule, much of what we know about U.S. governance is seemingly being re-written on the fly. But is it really? Is the age of Trump all that new? I do not think so. A point made implicitly in those posts is that what Trump trying to do is not new; indeed, it is straight-forward to analyze his ruling style and if/how he will be constrained if we have a concept of legitimacy and the role it plays in political decision-making.

I have tried to clarify why legitimacy is important in my previous posts (and in my book, which is out this month!). The current post is meant to clarify one potential, and important, misconception regarding political legitimacy. In my last post, I argued that an important part of Trump’s legitimacy derived from him winning a democratic election, and whether he held onto his legitimacy would depend on whether he followed the rule of law. I think these are two central pillars of the legitimacy of the U.S. presidency, as dictated by U.S. norms and culture and enforced by the judiciary and, in theory, the legislature. In response to this previous post, a good friend and co-author of mine, Murat Iyigun, argued that Trump’s legitimacy “derives from his promise to rattle the existing U.S. political system.” I think Murat has a good point – although I have refused since December 2015 to make any statements on Trump’s appeal, which has been vastly over-explained and is completely mystifying to me. My response Murat's point was that this was a definitional issue. I think that Trump’s popularity is derived from his promise to rattle the system (or, pick your own pet explanation); his legitimacy comes from winning the election.

Does this distinction between legitimacy and popularity matter, or is it just a silly bit of semantics thrown back and forth between a couple of out of touch professors? I obviously think it matters – or I wouldn’t be taking the time to write this post. Consider the following. Let’s start by assuming that Trump is popular enough. It doesn’t really matter for the sake of this argument why he is popular … just assume that he is. Whatever the reason he is popular – his willingness to rattle the system, his celebrity, his hair – the point here is that this is not what makes him legitimate. A ruler’s legitimacy is based on a society’s norms for what makes a legitimate ruler. For instance, in most medieval European monarchies, the king’s first-born son was the rightful heir to the throne (even if he was a giant asshole, as most kings and princes were), while in modern democracies the legitimate ruler is the winner of an election (according to the rules of the election, such as winning the Electoral College).

Why are these different concepts? Why can’t popularity be a source of legitimacy? The short answer is that popularity is fleeting; legitimacy is not. A ruler can lose or gain popularity quickly, sometimes due to his/her actions and sometimes for reasons beyond his/her control (e.g., business cycles). Legitimacy, once attained, is much more long-lasting. If one has come to power in a legitimate manner (e.g., winning an election), that aspect of their legitimacy remains with them throughout their reign. To maintain or enhance their legitimacy, rulers are constrained to take actions within a set of actions that society considers legitimate. So, for instance, in the Ottoman Empire sultans would frequently make public displays of religiosity (even if they were not themselves religious), because showing that one was a “good Muslim” was a key aspect of their legitimacy. Kings in early modern England would submit to Parliament on issues of taxation; rights to authorize taxation over time became the legitimate domain of Parliament, and kings who tried to evade Parliament eventually found themselves in trouble (see Charles I). In the U.S., a president can legitimately take many actions; (s)he can issue executive orders, conduct diplomacy, declare a state of emergency. These actions are generally considered legitimate … so long as those orders abide by the established law of the land.

Some examples might help clarify the distinction between legitimacy and popularity. A ruler who enters into an unpopular war may be unpopular but is still legitimate, so long as (s)he entered the war legitimately. Think Lyndon Johnson at the low points of Vietnam. Meanwhile, a leader who gains power in a coup with popular backing may be popular but illegitimate. Think Fidel Castro soon after the Cuban Revolution.

Why does this distinction matter? It matters precisely because popularity is fleeting but legitimacy is not. Let’s say that Trump is popular with part of the population because of his promise to shake up Washington. And, for the moment, let’s say that Trump is popular with a large enough share of the population that Congressional Republicans are afraid to challenge him. Fine. Anyone can rule if they are popular enough. People will listen to a popular ruler, and the usual sources of constraint (i.e., Congress), may not be strong enough to check a popular ruler. But what happens when a (seemingly inevitable) recession hits and Trump’s popularity falls with it? What does this mean for his capacity to enact his agenda? If the framework I proposed above is correct, it means that Trump will need to fall back on something besides his popularity in order for him to act as an effective president. Historically, most unpopular U.S. presidents were able to ‘fall back’ on their legitimacy as president. Fidel Castro was able to ‘fall back’ on coercion, persecuting and imprisoning any supposed enemy of his regime. An unpopular but legitimate president has a hard time pushing through laws and policies, but few will question that (s)he is the one that has the right to do so.

But wait, isn’t Trump really not that popular? It is true that his approval ratings are historically low for an incoming president, but that is not the point. The point is that he is popular enough. As long as Trump has the unwavering support of the ‘base’ – about 35-40% of the population – the conventional checks (i.e., Congress) are unlikely to actually check his power, since they depend on the support of the same swath of the population. Thus, as long as Trump’s popularity among the base holds, it does not really matter how legitimate he is. He can act however he wants, rule of law be damned, and he will likely get away with it. However, popularity is fleeting, even among the GOP base. It will not take a great loss of popularity – say, approval ratings around 30% – for those Republicans he has co-opted in Congress to realize that their incentives are no longer aligned with those of the president. In such a case, Trump is in real trouble if he repeatedly acts outside of the rule of law. Acting within the confines of the rule of law is one of the most important sources of legitimacy a U.S. president has available. And an illegitimate, unpopular ruler tends to not last very long unless they have co-opted another source of power, such as the military (ask Richard Nixon circa 1974).

The fear posited in my previous post is that Trump will take a page out of the autocratic playbook and fall back on something else (à la Castro) should he lose his popularity. But is this fear warranted? Thus far, it is probably not warranted. There is little to suggest that Trump can or will co-opt an alternative source of power. I have been wrong on Trump many times before, but I think there is little chance he will co-opt the military to support an unpopular – and illegitimate – regime.

It is easy to get lost in the short-run actions of a popular (enough) president who acts contrary to the rule of law. It is easy to ask “how can this be happening?” It is harder to think through the longer-run consequences. On the optimistic side, I am now more convinced than ever that Trump’s comeuppance will come, possibly in the form of impeachment, should he continue to thumb his nose at the rule of law. For this to come to fruition, Trump must be unable to cultivate an alternative source of legitimacy outside of democratic norms. If he fails to do so, he will be in major trouble once something happens to damage his popularity. On the pessimistic side, even if Trump’s comeuppance does come, he will have likely done lasting damage to the democratic norms that have long been important in the U.S. To take the extremely pessimistic view, Trump’s body blow to U.S. democracy and democratic norms could very well lay the path for a future strongman to deliver the knockout punch.

Why do Rulers Follow the Rule of Law? Thoughts on Trump, Erdoğan, and History

posted Jan 31, 2017, 11:42 AM by Jared Rubin   [ updated Jan 31, 2017, 11:44 AM ]

It is astonishing how quickly the U.S. has been set on a path where the rule of law no longer exists as a cornerstone of governance. As Mark Koyama points out in an excellent post, American rule of law has proven to be way more fragile than what even experts on the subject thought possible. The ban on people from seven Muslim-majority countries entering the U.S. despite having valid green cards and work visas, along with the firing of the acting attorney general for defying an order she viewed as illegal seem like just the beginning. So how did it get to this? Is American rule of law really so fragile that it can be trampled upon so openly within a few weeks of a new presidency?

In my view, the rule of law exists when it precisely that – the law rules, and it rules for all. What this means in practice is that laws are not arbitrary, they are applied equally to all, and those imposing rules do so within the confines of the law. It is the last of these aspects that I wish to focus on here. Why do rulers in societies governed by the rule of law actually rule within the confines of the law? When their desires are contrary to the law, what is to prevent them from ruling as they wish?

These questions well pre-date politics in the era of Trump. Their answers are something I have long been interested in as an economic historian because I believe that they hold, in part, the keys to understanding where modern wealth comes from. Freedom from arbitrary rule for a broad swath of the population means that those people will have incentive to invest, trade, and more generally grow their wealth without the grabbing hand of the state taking anything more than its pre-specified cut (which may be a lot, but as long as everyone knows that going in they will be able to adjust their actions accordingly). The absence of the rule of law encourages the opposite; why should anyone except the ruler’s cronies try to enrich themselves if it is just going to make them a target of confiscation when the ruler is in a bind?

But this only answers why the rule of law affects economic outcomes. The far more important question, especially in the era of Trump, is why rulers follow the law in the first place. A famous (within economics circles) paper by Douglass North and Barry Weingast answered this question by arguing that a constitution will only promote the rule of law when it is self-enforcing. In other words, when all of the relevant players have incentive to follow the constitution’s dictates (i.e., follow the law), the rule of law will be followed. It is a nice argument (despite its detractors), and it certainly gives a sufficient condition under which the rule of law works. When there are a clearly delineated set of rules and everyone has incentive to follow them – due to the presence of checks and balances that actually have teeth – everyone will follow them. North and Weingast argue that it is a society’s institutions which delineate these rules and provide the sanctions for those who break the rules. That is, institutions provide the incentives for all of the key players to follow the law. I also buy this – the system of checks and balances in the U.S., for instance, is very much ingrained in U.S. political, legal, and even social institutions. And for the most part these institutions have served the U.S. well. Presidents from Washington to Obama tended to follow the law, and when they arguably failed to follow the law there was enough gray area where reasonable people could disagree whether what they were doing was legal (well, except maybe for Richard Nixon).

But just because these institutions worked pretty well in the past does not guarantee they will work in the future. What happens when someone comes to power via democratic election and wants to test the bounds of the rule of law, as I think it is pretty clear Trump is doing in his first two weeks in office? Here is where I think a more general framework, informed by history, for understanding political decision-making helps. And indeed, this is one of the primary themes of my forthcoming book. I think it is impossible to understand why rulers act the way they do without understanding the societal features that shape their incentives. As I mentioned in my last (and only!) post, the two primary ways that rulers stay in power are through coercion (i.e., the barrel of a gun) and legitimacy (i.e., subject believe the ruler has the right to rule).

Coercion is easy to understand: if someone controls all the guns, they can act as they please. Legitimacy is a little less obvious. What makes a ruler legitimate differs by society. For instance, in some societies religious legitimacy works well, in others it doesn’t. More generally, a society’s informal institutions, those that are shaped by the society’s beliefs, norms, ideologies, family structures, and culture, constrain the mechanisms a ruler can use to legitimize rule. In the U.S. (and most Western countries), a strong belief in democratic rule meant that ruling according to the rule of law is a powerful source of legitimacy: a president elected in a fair election who enacts laws and policies according to the law is likely to go unchallenged, at least with respect to the legitimacy of his presidency. As long as those informal institutions supporting democratically elected presidents are strong, the other formal institutions (e.g., Congressional oversight, an independent judiciary … those institutions that provide the checks on executive power) work pretty well to constrain the worst impulses of the president (or the populace). In other words, informal and formal institutions are complementary: formal institutions do not work well unless the appropriate informal institutions are working well. This is why presidents conventionally follow the rule of law. A president has incentive to follow and act consistent with beliefs supporting democratic norms because it is precisely those beliefs that got him into power in the first place (for the academics out there, this last sentence is very much a nod to Avner Greif).

Yet, to use the terminology of economics, this is an equilibrium outcome. This simply means that, given the actions of the other relevant players, none of the players we are concerned with has incentive to act any different. In other words, past presidents realized they might be constrained by the legislative or judicial branches, but this was part of the game; the game did not include an alternative set of rules where such constraints do not exist. But, again to use the terminology of economics, is it possible that there is another (multiple) equilibrium, one in which the old rules do not apply? If so, what would it look like?

If there is another equilibrium, it is key to understand that the old rules we are all used to applying do not necessarily apply. That is, the traditional set of checks and balances would be useless; a ruler who does not feel checked will not act as if they are checked. Can such an equilibrium really exist, especially in a country that has had a form of democracy for over two centuries? I believe that it can, and we need to go no further than contemporary Turkey to find a relevant example.

Murat Iyigun and I wrote a short piece in the wake of last summer’s failed coup detailing how we suspected President Recep Tayip Erdoğan would rule in the wake of the coup (and, sadly, I think we are being proven correct). Erdoğan came to power as a democratically elected Islamist, and he still is. His original source of legitimacy was largely democratic norms, a relatively new phenomenon to Turkey, existing since only the 1950s. He ran as an Islamist, but this was not his source of legitimacy – it was a policy preference of the voters (just like appeals to Christianity are not really a source of legitimacy in the U.S., but politicians make them because they win votes). Since 2010, however, Erdoğan has increasingly appealed to religious dictates and increasingly co-opted the religious establishment to legitimize his regime. Meanwhile, Erdoğan increasingly staffed the military and bureaucracy with loyalists, giving him access to the state’s coercive power. Combined, this gave Erdoğan the capacity to rule using what we called the “Ottoman blueprint” of religious legitimacy and military coercion as the two central pillars of rule. Such a blueprint largely ignores the rule of law (unless it suits the ruler), suppresses dissent, and undermines democratic norms. It is possible to rule this way in Turkey because its informal institutions permit it – especially the Turks’ long pre- Atatürk history of accepting religious legitimacy. While many Turks do not accept religion as a source of legitimacy, particularly in cosmopolitan cities such as Istanbul, a large enough share of the population accepts religious legitimacy to make it tempting for a wanna-be autocrat to employ.

A ruler like Erdoğan therefore may want to attempt to undermine democratic norms and the rule of law when two conditions hold. First, the ruler’s desired laws and policies must (mostly) not be achievable under the prevailing set of formal and informal institutions. If they are, and the ruler is in power due to democratic election, there would be no need to undermine the norms. Indeed, those norms would help him/her achieve their desires. Second, the ruler must have an alternative source of legitimacy and/or coercion. If it is democratic norms and the rule of law that originally provided the primary source of a ruler’s legitimacy, that ruler will not last long unless they have another means of staying in power. This is why Erdoğan has so far been successful in his transition to autocrat. He cultivated alternative sources of power – religious legitimacy, military loyalty, with a sprinkling of democratic legitimacy – that permitted him to undermine what got him to power in the first place.

Where does this leave us with respect to the U.S.? The optimistic take is that Trump is no Erdoğan. By this I mean, most importantly, that Trump does not have an obvious alternative source of legitimacy outside of democratic norms (and all that entails, including following the rule of law). It’s not just that Trump does not have religious legitimacy available to him – this is not really something that the informal institutions of the U.S. permit. It is more that Trump, from all I can tell, has not cultivated an alternative source of legitimacy. Granted, many of Trump’s supporters will support him no matter he does. But it would not take a large share of his current supporters eventually viewing him as illegitimate to embolden those working within the confines of the rule of law – i.e., the GOP establishment – to ouster him. I also see little chance that Trump co-opts the military, which would be one of the first steps in the playbook of an erstwhile autocrat. That said, Trump has already done incredible damage to the norms that uphold the U.S. political system, especially those based on the rule of law. I suspect the damage will only deepen the longer he is permitted to stay in office. Time will tell if the damage is irreversible, but on that front I am not optimistic. Culture and beliefs – those things so vital to our informal institutions – tend to be pretty sticky.

Do Political Institutions Still Rule? Thoughts on Acemoglu and Trump

posted Jan 26, 2017, 2:51 PM by Jared Rubin   [ updated Jan 26, 2017, 3:37 PM ]

Let me begin by saying that I think few people have done more for economic history over the last two decades than Daron Acemoglu (and by extension James Robinson and to a lesser extent Simon Johnson). Economic historians now take identification much more seriously in large part due to Acemoglu. Although we occasionally go too far (myself included), this has been a net positive for the field and has certainly helped us get into the top journals. Likewise, development economists really take economic history seriously now, in no small part due to Acemoglu’s pioneering work. So what follows is not meant to denigrate Acemoglu’s many important contributions. It is merely meant to put them into what I believe is the appropriate context and to spell out the limitations of his most important works.

In a recent Foreign Policy article, which Tom Pepinsky brought to my attention in an excellent blogpost, Acemoglu makes an argument that is seemingly an about-face on most of his important works on institutions (e.g., here, here, and here). The theme running through most of these works – which may very well win him a Nobel someday – is that political institutions matter. Ok fine. But how and why do they matter? My reading of his works, especially Why Nations Fail (with James Robinson), is that “inclusive institutions” are the key. Put simply, if a state has political institutions that are inclusive – meaning that they give rights and representation to a broad set of the population and not just a small swath of the elite – good things follow. It is a nice idea that makes intuitive sense; if a society has inclusive institutions, it should be able to limit rent seeking by the elite, public goods should be provided if they benefit the masses, taxes are likely to be more progressive, property rights should be protected for all (not just the well-connected), and so forth. I buy this. But it raises two important questions. First, can economic success arise in the absence of inclusive institutions? This is not a question I address here. It clearly can (see China since 1978), but there is plenty in Acemoglu’s work that is consistent with this. The more important question, which I address below, is why do some societies have inclusive institutions and some societies not?

Acemoglu makes an about-face in his Foreign Policy article by claiming that the political institutions of the U.S. are not enough to save us from Donald Trump and his brand of (hopefully potential) authoritarianism. Instead, he claims, civil society is our last hope against a devolution into something like another country Acemoglu knows well, his native country Turkey. For anyone who has followed Acemoglu’s work over the last couple of decades this a bit surprising. Acemoglu’s work is central to what I will call the “augmented Washington consensus” (or AWC, for short) – the neoconservative foreign policy platform adhered to during the Bush (43) administration, and to a lesser extent the Obama administration, that democratic institutions (small d) are a panacea. That is, where there is democracy there will be inclusion, and where there is inclusion there are good economic outcomes. Nowhere in the AWC playbook is there anything about “civil society”, unless Acemoglu has in mind the masses that might rebel if things get too out of hand. But I don’t think that is what he means. I think he means civil society in the way it is commonly meant – those non-governmental organizations, norms, and institutions that represent the masses and check the power players. But this presents a contradiction: if civil society is the only thing that can save us from a Trumpish authoritarian, and civil society’s voice is dependent on inclusive institutions, what happens when the authoritarian undermines the inclusivity of institutions? How can civil society work to constrain the Trumps of the world?

The answers to these questions are embedded in the more important question asked above: why do some societies have inclusive institutions and some societies not? Although I do not make this argument explicit in my forthcoming book (out in February 2017), a clear implication of my book’s arguments is that inclusive institutions are often a byproduct of other, more deeply-entrenched institutions. These institutions are the ones that determine a society’s economic trajectory; inclusive institutions are not necessary and they definitely are not sufficient for a society to have “good” economic outcomes.

What are these more deeply entrenched institutions? My book suggests that the key to understanding political decision-making is to focus on how institutions provide costs and benefits to those in power for enacting various law and policies. This is not to say that there is a universal set of “good” institutions (i.e., those that are ‘inclusive’) or what works in one society will work in another. Instead, the important consideration is what the political elite do to stay in power. Rulers have two means of staying in power: coercion and legitimacy. The relative costs and benefits of using coercion and power are determined by a society’s institutions, and these are the deeply entrenched institutions that matter. Coercion is useful because those with enough guns can stay in power, so long as they keep the users of guns (i.e., military) on their side. Legitimacy is more subtle. A simple definition is that a ruler is viewed as legitimate if people believe (s)he has the right to rule. Donald Trump is a legitimate ruler because he won an election. Anything that threatens to undermine the legitimacy of the fairness of the election, such as the possibility that the Putin propaganda machine played a role in the election, in turn threatens Trump’s legitimacy. To be clear, I suspect that a large share of Trump’s supporters will view him as legitimate regardless of what he does or has done. But it would not take much of a drop in his support – say to around 30% approval – for an erstwhile supportive GOP establishment to turn their back on him. So any even small threat to Trump’s legitimacy may carry large consequences.

The key insight here with respect to Trump is that U.S. democracy, or any democracy for that matter, is not inherently inclusive. Past U.S. presidents with legitimacy derived from (relatively) free and fair elections tended to find inclusion beneficial for their legitimacy, so democracy in the U.S. tended to be associated with increasingly inclusive institutions (well, at least for white men). But inclusive institutions are an outcome, not a cause. They are an outcome of the process through which political rulers are legitimized. Each society has its standards for what makes a legitimate ruler, and these standards are determined by the society’s culture, religion, beliefs, and social norms (the works of Avner Greif are particularly relevant here, especially his book, as is an amazingly prescient paper by Murat Iyigun). A president who can chip away at the institutions that constrained previous presidents while still maintaining some degree of legitimacy with a sufficient portion of the population can undermine inclusive institutions in the context of a democratic setting. There is nothing inherent about inclusive institutions or democracy that leads to good outcomes. What is important to answer is why democracy works in the first place – that is, why are democratically elected rulers considered legitimate and what can happen that may undermine this belief?

Viewing democracy through this lens lays transparent the bullshit of the AWC foreign policy platform that transplanting democratic institutions into settings that are not ready for them can lead to good results. (Of course, the failure of the Iraq War already did enough to undermine this idea as viable foreign policy.) One insight mentioned in my book, which is certainly pertinent to post-invasion Iraq and the post-Arab Spring Middle East more generally, is that it is not obvious that democracy will work well in a setting where rulers – or potential rulers – find religious legitimacy to be particularly effective. What is to prevent a rival with backing from the religious establishment from unseating a democratically-elected leader? More importantly, what is there to prevent a democratically-elected leader with backing from the religious establishment from undermining democratic, inclusive institutions and replacing them with rules supporting autocratic rule? It sure isn’t civil society.

To bring this back to the original point of the post: how do we square “civil society saves us from Trump” Acemoglu with “political institutions rule” Acemoglu? I think this means going beyond anything Acemoglu has written or even implied, but it is by no means to throw out most of his insights. Instead, it is simply to note that “political institutions rule” and “inclusive institutions are key” are two very different things, and one does not imply the other. My interpretation is that political institutions do matter; and indeed, inclusive institutions are often associated with positive economic outcomes. But inclusive institutions nor even democratic institutions are enough; it is what undergirds those institutions that matters. And peeling the onion back one layer reveals that it is political legitimacy that matters. So democracies can exist but not be inclusive – Turkey is a prime example in 2017. This happens when democratic rulers are able to achieve some degree of legitimacy from democratic election and some degree of legitimacy from another source. In the case of Erdogan, it would be foolish to discount the role that religious legitimacy has played in his ascent to autocrat.

What does this all mean in the age of Donald Trump? While I make no claims to have the wit or intelligence to prognosticate the future, I think I can say something with respect to Acemoglu’s claim that civil society is our best hope to resist authoritarianism. I think he is right, but not because of what I have learned from reading Acemoglu (and to be clear, I have learned a lot). He is right not because civil society can legitimize a president but because it can delegitimize a president. This has little to do with democracy. If civil society broadly considers a ruler to be legitimate, then the ruler will be able to act as (s)he pleases, democracy be damned. More importantly, if civil society begins to view the president as illegitimate, (s)he will not be able to rule effectively and will have to rely heavily on coercion to rule as an autocrat. Fortunately, American civil society is pretty strong relative to much of the rest of the world. Whether this is enough to constrain the unseemly ambitions of Trump is something for future historians to debate.


**Huge thanks to Murat Iyigun for looking over a draft and providing excellent, detailed comments!

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