What separates rich countries from poor ones?

What separates rich countries from poor ones? No doubt everyone has a theory; Entrepreneurs, education, leadership and some even argue race plays a role. I am not here to discount any of those assumptions, although I find a theory based on race a bit problematic.

But before we discuss what makes a great nation, we must first understand what a rich nation is.

We all have examples that spring to mind; America, Germany, Britain, Sweden.

All of these countries seem to have one thing which clearly differentiates them from their poor counterparts. Their citizens on average fare better than those in poorer countries. Their per capita income, level of education and standard of living are much higher. This is of course a point for the education theory. Except that Americans are some of the most ignorant people alive.

What makes the lives of these citizens better? Their systems and structures. And what makes these systems work are their institutions.

Many of the world’s greatest inventions were made by the US Military. The internet for one. Youtube wouldn’t exist without the internet and Larry Page (Google co-founder) wouldn’t be a billionaire.photo.jpg

Larry Page.

Germany’s economy is supported by medium and small scale businesses, which makes its inequality gaps smaller and their tertiary education is focused on educational institutions which are the equivalent of Polytechnics, devoted to instilling practical skills.

China, which is probably the only country challenging the US economically has most of their businesses supported by the government. In fact government involvement is so high it has frustrated many attempts by Western businesses to enter that market.

This doesn’t just apply to economics. In law enforcement, studies show that developed countries have their police go through more thorough training.NigerianPoliceForce.jpg

Nigerian Police3301944_nigerianpolicevsuspolice_jpegea6dab8b24de8a4005f5a7e1b5f363d0 (1).jpeg

And their legal systems are better equipped to enforce the law. In many developing countries, money determines who is safe, secure or has their day in court. There are many stories of people who are locked behind bars for crimes which they haven’t been tried, all because their papers were misplaced and people forgot about them. Or police who came to arrest criminals and failed to secure the parameter allowing the criminals to escape. In fact, there are claims that people who watch crime dramas know more about police investigations than police from developing countries.

This is not to say developed countries are perfect. The US has huge inequality issues and Britain and Germany have sectors of their economy that have stalled in growth for decades. However, institutions put in place give them a better chance of solving their problems than poorer countries.

To end this post I will address the time theory. Many argue that these countries simply have had more time to develop. To counter this are Singapore and Rwanda._88095562_rwanda_kagame_g.jpg

Paul Kagami, {President of Rwanda}

Two countries that began under less than ideal circumstances and are younger than Ghana( a developing country). Yet as of this post are faring better.

What does this mean for people not in government? The ordinary person who isn’t a policy maker? Institutions require rules and procedures to function, and although rules and bureaucracy have been given a bad name, they can be effective and can save lives. Whatever institution you work in, be it a hospital or a bank, it’s your duty to make it as efficient and effective as you can. Because people make an institution work, and institutions make a country work. Just imagine how your country would be, if everyone in every industry and institution gave you the treatment you wanted. It may seem impossible, but don’t worry. Considering my post on robots, if humans don’t achieve it, robots might.


The Seven Secrets of Germany

Why Nations Fail: The Origins of Power, Prosperity and Poverty

The Locust Effect: Why The End of Poverty Requires the End of Violence


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