Monday, June 15, 2009

Acemoglu Text Review

Haven't posted in awhile. Been busy. Arm is better.

Anyway, today I had the considerable misfortune of sifting through Acemoglu's new textbook for a paper I'm writing. It's f*cking terrible. So, I reviewed it for Amazon, and the posted it on DeLong's blog as well. Here it is, for posterity:

This book is bad, bad, bad. Plain and simple. I give it one star b/c I don't know how to advance to the next screen and submit for no stars.

Having suffered the extreme misfortune of having been assigned to read and present some of Acemoglu's papers (some 2-3 times now), I have a lot of pent-up aggression that needs to be released. Now will be that time.

Acemoglu is that nerdy, pudgy, 4-eyed kid from school who everyone picks on and hates b/c he doesn't shut-up, is ignorant, and incredibly and persistently annoying. The kid who says stupid, ignorant things which are just plain dumb on multiple levels, who does not understand what he should know -- just doesn't get it -- and who everyone therefore (or perhaps just me) wants to strangle with their bare hands. He evokes the same feelings in me I get when I watch George W. Bush give a speech. (If you like George W. Bush, then you will love this book!)

So that is how Acemoglu makes me feel when I'm forced to read anything by him. Now, what is it that gives me those feelings? Here are some of the things I hate about his research/book:

1) His famed settler mortality data, which Albouy has convincingly shown were fabricated, do not merely affect GDP via institutions -- they also should and would have affected levels of technology, human capital, and culture, each of which are persistent. The kicker is that since he had data on initial institutions, there was no reason to make up the settler mortality proxy in the first place.

2) His unquestioned use of Maddison's data, which Maddison, by all accounts, simply made up, and which implies (counterfactually) that there never was a Malthusian world. Aside from being made-up, Maddison's data are obviously and fatally flawed.

3) His arrogance in thinking that he could write a book about economic growth without knowing anything about history, and his arrogance in thinking that he could write about geography and development without really having read Jared Diamond (and without even citing Alfred Crosby). It is frustrating that he equates the belief that geography is important for development and history with "geographic determinism" -- that geography is the only thing which matters. No thinking person could believe that, and reading Diamond or Sacchs in the round suggests that they are certainly NOT geographical determinists.

4) As such, he "misunderestimates" the "geography hypothesis" as he calls it.

5) He is a full time believer in the idea that by doing algebra (but not by reading the history of development), one can gain insights into the history of development.

6) A troubling array of shoddy facts, inaccurate statements, frustratingly wrong-headed logic, and all hidden behind a veneer of high-handed math and regressions. Some of these include:

a) His insistence that the North Korea/South Korea split tells us that geography and culture does not matter, and that it is institutions such as property rights which do matter for growth. The trouble with this is that North Korea was taken over by an utter madman who was an absolute dictator and who shut off trade and contact with the outside world. Logically, it's like saying that eating well and exercise do not matter for health b/c, look, you and your brother (who got hit by a bus) ate the same things and exercised the same amount, and your brother got hit by a bus and died. Of course, looking both ways before you cross the street is also important, but then again, who is saying that it isn't? (Acemoglu is basically saying it's the only thing...) The question is which institutions matter, and since North Korea got almost all institutions terribly wrong, the North Korea/South Korea split is actually not insightful.

b) In 'moglu logic, the "Reversal of Fortune" was supposedly that countries like Argentina and North America which were poor in 1500 are now rich, and vice versa has just one flaw. The peoples who lived in modern day argentina and north america are now dead, not rich. and we don't actually have any idea that say, north america was more/less developed than mexico. and certainly don't know if it was rich (and those are two different things, which acemoglu doesn't understand, b/c the world was malthusian then.

8) How does a tenured faculty member at MIT in economics not understand the Malthusian model? WTF?

9) In fact, there are many theories that can be taken "off the shelf" so-to-speak, which do tell us quite a bit about economic development, such as in Krugman's Geography & Trade, the Malthusian Model, Crosby-Jared Diamond, Engerman-Sokoloff, etc., which are all either butchered in Acemoglu's retelling or omitted.

OK, so I've clearly used up more actual thought writing this review than Acemoglu has in his entire research career.

In short, this book is sooooo bad it discredits: not Acemoglu, b/c u can't blame him necessarily, he is what he is, but rather, it completely discredits MIT economics, Robert Solow, growth economics (the soft underbelly of Macro, which is the soft underbelly of economics, which is the soft underbelly of Social science), and the entire economics profession. I am know dumber than i was before i read what parts of this book i could stomach. This book is bad enough to cast a black shadow over the department and the entire field of economics. This book is fodder for those who equate economists with medieval priests or doctors, who babble on about things about which they know nothing, and have no value-added to society.

This book is of interest to sociologists or anthropologists wishing to document the funny "sociology of economics" and the anachronistic, heavily ideological lens with which conservative economists view the world.

Lastly, it is rather strange that while many decrie the fall of U of Chicago, the decline and fall of MIT Economics has hardly been commented on. Clearly, Acemoglu's rise at MIT can and should be equated (in its impact on educated society) with the Vandals sacking of Rome.

that is all.

Have a great day!!!


  1. Welcome back!

    Good rip.

    Is there any chance you can mess with the html for the site to widen the margins (it's a pain to read something this narrow!), but I like the work.

    I still don't understand how you're an aspiring academic economist - my personal favorites are mostly people who work in finance (either some of the bigger analysts like Rosenberg and Xie, hedge funders like Dalio, and Fleckenstein, or the enigmas of Roubini/Duy/Setser). You spend a lot of time ripping apart the field, and seem to have a strong interdisciplinary background. Who are the economists you really look to? Are you more of a post-Keynesian? Where do you really place yourself in the field?


  2. Acemoglu's literature reviews are well-researched and historically sound. As an example of why one of your arguments fails, he himself recognizes that the North/South Korea split doesn't tell us which institutions are important. You can't deny that it does show the importance of good governance, which was his point. You have little to say in "ripping apart" the work besides asserting that it is bad, and as we all know from elementary math, proof by vigorous handwaving never works.

    Top-30 econ program? Pshhht. Maybe if you were in a top-10 program you'd see why you fail.

  3. Um, so how does the North/South korea split imply that geography doesn't matter? That's the conclusion Acemoglu draws.

  4. You are an undertrained moron. Just because you cannnot stand the rigour, you do not have to insult arguably one the most brilliant economists of our time. His text is a true tour-de-force, it is the best book on macro economics I have ever had the privilige of owning.

  5. Dear Anonymous: Teach me one thing you learned in that book about economic growth which is not already obvious to an intelligent non-economist. I suspect you cannot.

    And, I'll have you know, I've suffered through graduate probability theory in a top 30 Math department, I was one course away from a Masters Degree in mathematics, and I like solving old analysis hws as brain teasers.

    The issue is that Acemoglu is virtually incapable of making a sensible argument about anything. I think this is related to his "training" -- which was very technical, and I'll confess he is technically gifted, but nevertheless it's clear that something went very wrong in his education somewhere.

    Here's another point re: Acemoglu that you won't be able to contest. He also says the Korea split shows that culture isn't the key to economic growth b/c the N & S both had Korean culture. Yet, even though South Korea and North Korea might have begun with the same or very similar cultures, culture itself is something which changes and evolves. Culture in South Korea is very different today than it was in 1950. A society's leaders and government are likely to have an enormous impact on that society's culture. Perhaps the key to economic growth is to not have a madman controlling a country's culture? Well, the north had a madman influencing its culture, the South did not, so how in the world does the North/South split tell us culture doesn't matter and that it's institutions such as property rights and free trade that do?

  6. I cannot agree more with you Veblen. I don't believe Acemoglu has the sensitivity of a social scientist. Moreover, Veblen himself founded the basis of the institutionalist approach, and he actually thought very differently...

    Of course, I am not trying to say "if he were alive...", but this Acemoglu guy gets on my nerves (I also have to suffer reading him at my univ)... professors here are just as uncritical and orthodox that it annoys me.

  7. Okay, there s one true fact about Acemoglu: Not many people see his settler mortality as a plausible argumentation. It may make sense in numbers, but not necessarily in context to today's developing countries. His work is much appreciated, nice findings, but not overwhelming nor of great help !

  8. culture doesn't matter and that it's institutions such as property rights and free trade that do?

    Is there actually much of a difference b/w culture and institutions? I would think that culture is nothing more than informal institutions if we define institutions as the "rules of the game" which it tends to be defined as. but then again the definition is not agreed on in the lit.

  9. yep, that's part of the problem. When economists say "institutions matter" it's almost a meaningless statement b/c institutions include all forms of culture and governance which, obviously, affect all kinds of human behavior. It's nearly tautological...

    Yet, many "institutionalists" also believe that there's no such thing as culture. Rational man and all that. It's just property rights, free trade and low tax rates that count as institutions which matter. You won't find a lot of mention of culture in the Economics literature, even though it's a social science...


  10. says Thorstein: "I am know dumber than i was before i read what parts of this book i could stomach."

    right, you know dumber very well
    leave more complicated thoughts for later; focus on grammar & spelling