In my Wall Street Journal opinion piece about the three Nobel Prize winners: “A Nobel Prize in Economics for the ‘inclusive’ free market,” published online the afternoon of the awards ceremony and in print the next day, I wrote:
The Nobelists’ contribution is to lay out empirical data on the specific economic institutions that have promoted or hindered economic growth, and then to examine the factors that led to these institutions. They point out, like Adam Smith, that property rights and the rule of law are crucial.
What I couldn’t say, given my severe word restriction, is in their book Why Nations FailDaron Acemoglu and James A. Robinson made short work of Adam Smith. Look up Smith in the index and you will find one reference. Go to that page and you will see that the reference is to the ‘invisible hand’. That’s it. No mention is made of institutions, which are a large part of it An inquiry into the nature and causes of the wealth of nations. And that is not talked about The wealth of nations in the 17 pages of references.
I was looking at the text at the front of the book this morning and found this from Niall Ferguson:
Brilliantly synthesizing the work of theorists from Adam Smith to Douglass North with more recent empirical research by economic historians, Acemoglu and Robinson have produced a compelling and highly readable book.
Acemoglu and Robinson discuss recent empirical research by economic historians. The book is compelling and highly readable, and their bibliographic essay references a number of Douglass North’s works.
But the authors did not mention Adam Smith’s work. I gave above the only mention of Smith I could find.
Postscript:
Since I wrote my op-ed, I came across this part by Ryan Young of the Competitive Enterprise Institute. It’s excellent.