# La face cachée du développement : retour sur les récipiendaires du Prix Nobel 2024 d'Économie

Patrick Plane

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Centre d'Études
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Développement International

WORKING PAPER

No. 2025/6-EN

*The hidden side of
development: back to
the 2024 Nobel prize
winners in economics*

Patrick Plane
## Cite this working paper

Plane, P. "The hidden side of development: back to the 2024 Nobel prize winners in economics", CERDI Working Papers, 2025/6-EN, CERDI.

## The author

Patrick Plane

Research Director Emeritus,
Université Clermont Auvergne, CNRS, IRD, CERDI, F-63000 Clermont-Ferrand, France.
Fondation pour les Études et Recherches sur le Développement International (Ferdi),
Université Mohammed VI polytechnique, ARES, Rabat.

Email: [Patrick.PLANE@uca.fr](mailto:Patrick.PLANE@uca.fr)

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Ce travail a bénéficié d'une aide de l'Etat français gérée par l'Agence Nationale de la Recherche au titre du programme "France 2030" portant la référence "ANR-16-IDEX-0001".

This work was supported by the Agence Nationale de la Recherche of the French government through the program "France 2030" "ANR-16-IDEX-0001".

The author would like to thank Simone Bertoli, Jean-Louis Combes, Sylviane and Patrick Guillaumont, Grégoire Rota-Graziosi, and Jean-Michel Severino for their comments on an earlier version of this article. The ideas expressed are, of course, solely those of the author and do not necessarily reflect the views of the various organisations which he is affiliated with.

CERDI Working Papers are available online at: [https://tinyurl.com/2xwfzw8s](https://tinyurl.com/2xwfzw8s)

Director of Publication: Simone Bertoli

Editor: Catherine Araujo Bonjean

Publisher: Marie Dussol

ISSN: 2114-7957

### Disclaimer

Working papers are not subject to peer review; they constitute research in progress. Responsibility for the contents and opinions expressed in the working papers rests solely with the authors. Comments and suggestions are welcome and should be addressed to the authors.
**Abstract**

Institutions are increasingly recognised as one of the invisible factors which explain long-term economic performance. In 2024, the Nobel Academy awarded its prize to three economists who have made a major contribution to improving knowledge on the subject: Daron Acemoglu, Simon Johnson and James Robinson. This article looks back at some of their most important publications, offering a sometimes-critical commentary on their work and questions the implications it may have, particularly on the impact of international migration on institutions.

**Keywords**

Democracy; institutions; colonisation; prosperity; social capital.

**JEL codes**

A13, F22, F54, F56.
## Introduction

Economics is a human and a political science. The lack of certainty about its scientific nature led the Nobel Academy to dither for a long time before it awarded a prize for Economics for the first time in 1969. In 2024, the *Riksbank* prize was awarded to three neo-institutionalist economists: Daron Acemoglu (Harvard MIT), Simon Johnson (Harvard MIT) and James Robinson (Chicago). The message of their publications is unambiguous: development is closely conditioned by the quality of the economic and political rules that govern human interaction in society. Their work honoured by the Nobel jury is part of a long list of laureates who have dealt with institutions. No doubt Hirschman (1970,1989), whose reflections on development are a constant source of inspiration, would have deserved to be one of them. This article revisits and briefly comments on some of the publications for which the prizewinners of 2024 are renowned.

In writing this article, Montesquieu was an inspiring figure, one of the first to have explored in detail the role of formal and informal institutions in the sense that North (1994) gave them. Montesquieu’s *The Spirit of the Laws* (1748) conveys a strong message: the separation of powers protects against tyranny and promotes lasting freedom. When democracy is present, sovereignty belongs to the people. His *Persian Letters* (1721), with their epistolary character, are more romantic in nature and are less fashionable today. Nonetheless they teach us about the social glue of informal institutions and the importance of customs. Two Persians are discovering France. Accompanied by Rica, Usbek ponders and observes: "*Men are never so much offended as when their ceremonies and customs are touched*". Usbek’s statement is universal. Tolerance in the acceptance of cultural relativism has its limits when heterogeneous populations interact in the same geographical area. These interactions may be the product of colonisation, but they may also be the result of domestic or international migrations. Looking into the future suggests that the challenge inherent in migrations is not a small one: to maintain social cohesion and economic efficiency; to combine openness to others with respect for rules that have been established over the long term.

This article first leads us to discuss institutions in general, taking a sometimes-critical look at their conceptualisation and measurement by the three Nobel laureates (I). We then assess the relationship between rules and customs and the variables of geographical economics in terms of causality. This idea was presented earlier by Montesquieu, who indirectly suggested that institutions could be endogenous to the climate (II). The question of the rule of law and its temporality is then raised, a topical issue given the increasingly frequent rejection of the
ideological framework of democracy (III). We continue the argument by discussing the possible implications of current and future international migration. By analogy with the influence of European settlers who shaped institutions, unregulated migratory movements will be a potential source of alteration to the institutions of host territories, with predictable consequences for their economic performance and social cohesion (IV). The final section returns to the main messages of the article and the further reflections to which the 2024 Nobel laureates may invite us.

## I- Institutions: again, and again...

Thorstein Veblen (1857-1929) and John Roger Commons (1962-1945) qualitatively traced the functions of institutions in a society. According to them there is a collective dimension to the economy that is shaped not only by individualistic and utilitarian behaviour, but also by societal norms. The subject of institutions now permeates the entire field of social sciences. The economy bears witness to this in both its micro- and macro-economic components. The *common good*, as described by Jean Tirole (2016), is influenced by institutions that reconcile individual and collective interests. Rules are therefore an instrument of coordination, a framework of incentives and sanctions that sets the behavioural freedom of individuals. Locke (1689) reminds us: *Where there is no law, there is no freedom either*. The *handbook* by Jean-Marie Baland et al. (2020) and his co-authors (2020) covers a broad spectrum of situations in which formal rules, customs and culture are essential to understanding long-term performance. Jean-Louis Combes and Pascale Combes Motel (2022) also deal with the subject with a review of the literature on the causes of the wealth of nations.

In 1974, Gunnar Myrdal and Friedrich Hayek were awarded Nobel prizes for their penetrating analysis of the interdependence of economic, social and institutional phenomena. Ronald Coase followed in 1991 by highlighting the importance of transaction costs and property rights in the functioning of an economy. In 1993, Robert Fogel and Douglass North were recognised by the Academy for having renewed research in economic history by applying quantitative methods to the explanation of economic and institutional changes. The 2024 recipients are directly related to North. The quality of institutions influences the volume of trade. It is difficult to prosper if the key institutions, the state and the markets, are unable to prevent behaviour that generates transaction costs. In 2001, George Akerlof, Michael Spence and Joseph Stiglitz were in turn honoured for their analysis of markets with asymmetric information.
For development economists, the prescriptive message of Stiglitz (1989) is of particular interest. He argues that Liberal economics is naïve in its belief in a spontaneous order constructed by the mechanism of anonymous markets. Particularly in developing countries, reducing market failures must be the primary task of the benevolent state. The effectiveness of this commitment is anything but a sinecure. Positive analyses of the state, notably by James Buchanan, winner of the 1986 Nobel Prize, showed that public failures can be at least as serious as market failures. Finally, in 2009, the prize was awarded to Elinor Ostrom and Oliver Williamson for their analyses of economic governance, that focus respectively on the *commons* and on the trade-offs that companies make for their profitability between doing things themselves and having things done for them.

In such an abundant and award-winning literature, through which interstices could the three new Nobel laureates slip to innovate and shift the frontier of knowledge? Their contribution lies in a number of areas, not least in their empirical treatment of the endogeneity of institutions. Institutions *do not fall as manna from heaven*, but are a chosen model and are therefore in interaction with economic performance. Their 2001 article on the *colonial origins of comparative development*, which has 19,486 citations in *Google scholar* in June 2025, is a bravura piece. The narrative is based on the observation of the very different behaviour of colonists, depending on the more or less hospitable nature of the places where they settled, and their consequences for economic performance. High mortality rates among settlers and the presence of large local populations led to a preference for *extractive institutions*, which were continued after independence by the new political elites. In this context, political and economic power is in the hands of rent seekers who block the process of development. Conversely, low mortality and law population density favour settler colonialism. European populations bring with them economic and political rules that will form *inclusive institutions* based on respect for property rights and equality by the rule of law. Backed by political pluralism, which limits the arbitrary power of elites, these institutions promote sustainable growth, innovation, and prosperity. In the controlled explanation of economic performance, the authors' use of the mortality rate of the first settlers as an instrument for the institutional variable is therefore supposed to be decisive in understanding international differences in per capita income.
II- Institutions and performance: causal pre-eminence or mere determinant?

Many authors consider institutions to be a determining variable for development and the reduction of international income disparities. After the aforementioned Nobel laureates, Rodrik, Subramanian and Trebbi (2004), and Easterly and Levine (2003) have been influential in supporting this hypothesis.<fnref n="1" /> Acemoglu et al. ’s 2001 article occupies a singular place, if only because of the historical data and the multidisciplinary approach which give it its originality. Nevertheless, it remains under the critical gaze of the profession. In a commentary published by the *American Economic Review*, David Albouy (2012) identified the shortcomings inherent in the fragility of the data and the econometric approach.

Whatever the analytical care taken by the authors, the article has the usual problems of cross-sectional estimates, aggravated by the heterogeneity of the data on the mortality of the first settlers, as an instrument for treating the endogeneity of institutions. There is measurement error in this mortality, which does not represent an average for all the populations of settlers in an area, but very often a fraction of that population, a specific occupational category that is taken to represent the territory as a whole. Missing information from certain countries, which did not exist at the time of colonisation, is filled in by information from geographically close territories. Measurement error on an explanatory variable introduces an attenuation bias into ordinary least squares (OLS) estimators. If this variable is used as an instrument for an endogenous variable, as is the case with settler mortality, the risk is amplified when a cross-sectional analysis is used. Because the instrument is weakened, the bias of the IV estimator is increased (Bound, Jaeger and Baker, 1995).

The causal effect on economic performance is therefore not revealed with the
effectiveness, itself not without limitations, of a *difference-in-difference* analysis. Within this
econometric method the impact of the type of colonisation would be revealed by the differences
between countries that had *inclusive* and *extractive* institutions, with the two subgroups having
the counterfactual of the situation before the potential implementation of these institutional
arrangements. The originality of Acemoglu *et al.*’s work is therefore counterbalanced by a
slightly excessive boldness. The identification of cross-sectional data leaves open the
possibility of correlations between variables of interest and omitted variables with low temporal
variance.

<footnote n="1">¹ See the general presentation by P. Malgrange and P. Plane (2008) for the special issue of *Economie et Prévision*, on the economics of development and transition, Ministry of Finance, France.</footnote>
The quality of the instrument chosen to compensate for the endogeneity of institutions
in relation to performance has also been questioned. Is the exclusion restriction verified? If so,
the settlers' mortality rate would not affect the current prosperity of the economies other than
through its direct effect on contemporary institutions. Unless we consider that the control
variables capture these health conditions, this hypothesis can probably be refuted by a cross-
sectional estimate. The mortality that affected the colonists can still be applied today to the
natives. The state of health affects the productivity of agents and therefore collective
performance. Epidemics of yellow fever or malaria (Plasmodium falciparum) are perennial in
some African countries, particularly in rural areas, which includes around 60% of the working
population. According to Sachs and Malaney (2002), malaria reduces economic growth by
around 1.3% of GDP per year in badly affected countries. Alsan (2015) also mentions the presence
of the tsetse fly, that hampers the use of draught animals in agriculture and transport, reduces
productivity, and contributes to fragmented political structures. Yet the tsetse fly, which is currently a
factor in economic underdevelopment, has no direct correlation with the mortality of the first settlers.
Even in a panel estimation procedure, its economic impact would vary over time and would not be
measurable with a country fixed-effect. Extractive institutions and their measurement by settler
mortality are therefore not a monocausal factor in explaining long run economic
underperformance.

In the case of British colonisation, this argument is significant: the colonists settled in
the most promising territories, bringing with them resources and skills that they would have
refused to use in unfavourable contexts. These human qualities then spread to a wider
population, and were reproduced over time (Galor, 2022). Institutions are therefore correlated
with omitted variables, whether observable or not, which are endogenous to long-term
performance. The quality of the instrument is therefore questionable.<fnref n="2" /> In a hostile production
environment, it must also be assumed that the preference for the present may have contributed
to uncooperative behaviors and customs before the settlers had engaged in predation by
extractive institutions. Based on contemporary data (1981-2005) from 41 sub-Saharan
countries, Couttenier and Soubeyran (2014) show that drought increases violence and the risk

<footnote n="2">² In 2022, there were 249 million cases of malaria and 608,000 deaths in 85 countries. Sub-Saharan Africa accounted for 94% of cases (233 million) and 95% of deaths (580,000). See the [WHO website](https://www.who.int). According to the World Bank, malaria is a brake on economic development. It is estimated to slow GDP growth by around 1.3 percentage points per year in a number of African countries. It also discourages foreign investment, increases out-of-pocket healthcare costs, and reduces children's cognitive abilities. See the [World Bank website](https://www.worldbank.org).</footnote>
of civil war in poorly institutionalised rural areas. In other words, in the absence of a
counterfactual, the problem of identification is posed with an instrument of uncertain quality.
It is difficult to dispel any doubts that extractive institutions are the primary cause of
contemporary distress in certain countries.

Outside the Anglo-Saxon colonial context, the idea that the Western powers did not settle in countries with a high early mortality rate needs to be qualified. Portugal waged colonial wars from the 15th century onwards. Its territorial hold was initially for military and commercial purposes, with trade in gold and spices in particular, as well as the operation of a transatlantic slave trade economy. In the 19th century, it shifted to territorial occupation, which was to become increasingly important in the 20th century. In 1975, when Angola and Mozambique became independent, around 500,000 Portuguese were living in these colonies out of a population of 9 million, 5.5%. In Angola, the 300,000 Portuguese residents were victims of all tropical diseases, starting with malaria and yellow fever. The colonists died in large numbers in the first few years of their stay. The statistics used by the Nobel prize-winning trio put the mortality rate at 280/1000. The Angolan capital had the reputation of being a *graveyard for Europeans*. After the Berlin Conference (1884-1885), the colonists invested in the interior of the country as a settlement aimed at establishing the authority of the Portuguese sovereign. This policy was accelerated by the Salazarist dictatorship (1933-1968). In 1950, there were 100,000 Portuguese residents in Angola and the crude mortality rate was 25 to 30 per 1,000, 2 to 3 times higher than in Lisbon.

France also partly deviates from the authors' empirical prediction, but this was not the case for New Caledonia. In 1863, it became a territory for the resettlement of convicts through the granting of land taken from the indigenous people. This decision taken by Napoleon III was not dictated by the wealth of New Caledonia, even though immense nickel resources were discovered on Grande Terre in 1863. In addition to the desire to follow in the footsteps of *perfidious Albion* in the Pacific, one of the arguments for this decision was the mortality rate of prisoners held in the penal colony of French Guiana, nicknamed the "dry guillotine". Nearly 40% of the inmates died before finishing their sentence. This extreme precariousness was behind the transfer of populations to New Caledonia. The causes of death in French Guiana were multiple: forced labour, deplorable sanitary conditions, and tropical diseases. With this transfer of prison populations, the bare facts do not reject the thesis of the Nobel trio in the sense that the health conditions of the convicts did indeed dictate the choice of a new human settlement!
From 1830 onwards, the colonisation of Algeria by Charles X and then Louis-Philippe
led to a completely different outcome. In the sample considered for the *American Economic
Review* article (2001), Algeria (78.2/1000) is in the third quartile of countries with the highest
mortality, along with Sudan (88.2/1000) and Trinidad and Tobago (85/1000). In September
1848, however, it became an official colony. In 1830, 7,000 Europeans were registered in
Algeria, which then covered an area of just over 500,000 km², out of a total population of 3
million (Despois, 1956). This European population grew steadily to reach 1 million, of whom
more than 800,000 left the country in 1962. By way of comparison, in 1942, the French
population of the whole of West Africa was no more than 18,000. As a percentage of Algeria's
population, the European presence reached a peak of 14.4% in 1911 and then declined with the
demographic dynamic of the Muslim population, and was 10% in 1954, the year of the armed
insurrection of the Front de Libération Nationale (F.L.N.). Throughout the colonial period
(1830-1962), French institutions spread, with the unequal treatment permitted by the
*Indigenous Code*. Once independent, Algeria kept its Civil Code until 1975, when it adopted
the Arabic version of the Egyptian Code, which was itself influenced by the Napoleonic Code.

In sub-Saharan Africa, with its small population, France has not only been at the origin
of extractive institutions. However, the application of inclusive formal rules has been, and often
still is, thwarted by local informal institutions. This duality has been a factor of dissonance,
with perverse effects on the quality of public governance (J-P. Platteau, 2000). The persistence
of customs has worked against the effectiveness of distributing exclusive and transferable
property rights. This context has been a real stumbling block to market incentives for land
mobility organised around the exchange of protected titles. It is not for want of trying, but even
today, the absence of full and guaranteed property rights remains a handicap to the organisation
of land mobility, accumulation and the improvement of productivity through investment. This
absence is not the fault of extractive institutions. British colonisation, whether in America or
Australia, was different, and its effectiveness is often emphasised, but there were counterparts
that should not be forgotten.

Between 1607 and 1776, the year in which the 13 founding colonies of the United States
declared their independence, England ruthlessly asserted its coercive power in setting up its
institutions. The migrants brought with them their institutions, in particular the *Common Law*
system, which was applied fairly quickly on their arrival in Virginia. This policy had deleterious
effects on the indigenous populations. At the beginning of the seventeenth century, the
indigenous population was estimated to be between 1,000,000 and 2,000,000, compared to
250,000 Europeans. By 1776, only 100,000 Europeans remained in the territory of the insurgent states. The Amerindians were decimated, with the luckiest or boldest finding their salvation in migrating westwards. During this period, the number of Europeans increased to more than 2,000,000, with a further 300,000 or so slaves.

Here we see the ambiguity of what is meant by inclusive institutions. In common usage, the term inclusive denotes a desire for equity and social cohesion within a population. Through the institutions of these American colonies, which were called upon to achieve political emancipation, it testifies above all to submission to the law of the victor, to the exclusion of a large part of the indigenous population and their habits and customs. With its institutions, the sovereign colonial power lent itself to a veritable replacement of the indigenous populations. While the fruits of *the Pax Britannica* should have been sweet and the economic performance promising, the roots were bitter for the Amerindians.<fnref n="3" /> At the end of the eighteenth century, Australia provides the same insight. The Aboriginal population had shrunk considerably, and this reduction could not be explained by health trends alone, since the epidemiological status of the territory was favourable to the settlement of migrants, with a mortality rate of only 8.55/1000. The practice of *terra nullius* (empty land) replaced the land rights of the aborigines, who were forced to submit or disappear.

Attrition of the local population is undoubtedly an inevitable consequence of settlement colonisation. But it is a question of proportion. What was the situation in Algeria? There is still some doubt as to the figure for the local population in 1830. The reference given above puts the figure at 3 million, reduced to 2.5 million in 1872. Violence was the order of the day in coercive manoeuvres.<fnref n="4" /> But the coercion was not on the same scale as in the aforementioned English colonies, where the establishment and subsequent emancipation of these colonies was combined with inclusive institutions. In the colonies with low colonial populations, there was no major demographic drain on the indigenous populations. The total population of West Africa (AOF) and Equatorial Africa (AEF) was around 15 million in 1880 and between 20 and 25 million in 1900. In 1960, it was over 50 million. These figures could be interpreted as

<footnote n="3">³ Between 1763 and 1766, the Pontiac War, in the Outaouais chiefdom, was a key event in the violence between British colonists and Amerindians. One of the epoch-making episodes was the attempt by British officers to infect the Amerindians besieging Fort Pitt with blankets used by smallpox patients.</footnote>

<footnote n="4">⁴ The capture of Algiers, Marshal Bugeaud's smothering in 1840, Emir Abdelkader's resistance (1832-1847) and the Mokrani revolt (1871) are all sadly remembered.</footnote>
verification of the extractive nature of the institutions, but that would be a restrictive
interpretation.

On the eve of independence, France had opened no fewer than 16,000 primary schools and around 500 secondary schools in its colonised territory south of the Sahara. 15% of the school-age population was in primary education. In a difficult if not inhospitable environment as today's Niger already had 500 primary schools. Road and rail infrastructures were widespread for the time. Mali had a network of 240 kilometres of roads that were not exclusively linked to extractive industries. France tried to combine the opportunistic exploitation of territorial resources with a civilising message forged by both the evangelising Church and the secular Third Republic.<fnref n="5" /> This civilising message cannot be orthogonal with inclusive institutions unless we consider, but the prism is narrow, that the latter are conditioned only by the market and property rights favourable to incentives and accumulation. In other words, even with a low presence of settlers subject to a high mortality rate, the will to import inclusive institutions existed.

In difficult territories with high settler mortality rates, the British practiced indirect *rule*. Control was exercised through the traditional authorities, who applied the orders of the colonial power in return for economic favours. This strategy, which was less aggressive than in the North American or Australian territories, made it possible to reduce the divide between the indigenous and colonial populations and to limit the costs of political governance. On the other hand, France's influence on territories was stronger and more centralised. French power was exercised through a Governor General in the capital of each of the sub-regions that made up the AOF (Dakar) and the AEF (Brazzaville), assisted by governors or administrators in each of the colonies. Local chieftains played a lesser role than in the British system of *indirect rule*.

Over and above the relationship between the mortality rate of settlers and institutions,
the idea that the institutional factor has primacy in the current explanation of international
income disparities remains hotly debated. James Meade (1961), who won the Bank of Sweden
prize in 1977, expressed doubts about Mauritius's ability to develop. Geography seemed to
condemn this small island territory: low-income levels, dependence on sugar, demographic
growth, ethnic tensions and disparate populations, remoteness from markets, etc. For Mauritius,
the quality of its institutions and certain opportunities offered by the international community

<footnote n="5">⁵ Jules Ferry's speech to the Chamber of Deputies on 28 July 1885 captures the rashness of French colonisation.</footnote>
(sugar protocol, multifibre agreement, etc.) ultimately enabled it to overcome adversity, even though the environment is a factor that disrupts economic performance.

Montesquieu can be invoked to introduce the arguments of geographical economics. He puts forward the idea of a questionable determinism caused by climate. The author of *The Spirit of Laws*, wrote of a questionable determinism brought about by the climate. For him the climate shapes the way societies organise themselves and legislate. In hot countries, he argued, strong and durable institutions, compatible with political and social stability, would be unlikely, as they would be influenced by hostile environmental conditions.<fnref n="6" /> For the proponents of geographical economics, institutions have had a significant role to play. While this cannot be denied, their impact is not comparable to the influences of distance from markets, climate and soil fertility, health status of populations, and, more generally, the consequences of endowments in human capital or natural resources. This critical perception is all the more relevant given that the hypothesis of the primacy of institutions proposed by Acemoglu and his co-authors in 2001 is based on the use of an econometric instrument, i.e. the mortality rate of settlers, which is a matter for geographical economics!<fnref n="7" /> In any case, the thesis relative to the primacy of the geography asserts that the road to prosperity is paved primarily by financing to compensate for conditions hostile to development, rather than by the introduction of effective rules.

As a breeding ground for ideas, Harvard University was the academic cradle for the work of Acemoglu, Johnson and Robinson. Columbia University was a centre for challenging their conclusions, which were judged to be too exclusive, arguing that bad rules hinder economic progress, but probably less than an unfavourable physical context. According to Jeffrey Sachs (2003a, 2003b), developing countries, and African ones in particular, need external funding to help them cope with disease, and with the often-low literacy and school enrolment rates. Through this international solidarity, the aim is to break the isolation and low productivity associated with obsolete technologies, and to remedy the lack of roads that perpetuate the disjointedness of the economic space. Landlockedness, distance from world markets, and the associated transport and logistics costs have been analysed empirically (Limao and Venables, 2001; P. Plane, 2021). The problems associated with climate and soil fertility

<footnote n="6">⁶ Montesquieu (1748). "*The diversity of laws and governments depends on the diversity of climates*", *De l'Esprit des lois, Book 1, Chapter 2*.</footnote>

<footnote n="7">⁷ "When Acemoglu, Johnson and Robinson noted the correlation between high mortality rates of British soldiers in various parts of the world around 1820 and low levels of GNP per capita in the 1990s, they discovered the pernicious effects of malaria on economic development" *Cf*. Jeffrey Sachs (2003).</footnote>
attracted the attention of Jared Diamond (1997, 2005) before the subject of climate change was
widely taken up by others.

All in all, the idea that economics is reducible to the effect of the institutional factor is disturbing. It is probably excessive to refute that the skills and knowledge of the colonists were only marginal contributors (Glaser et al., 2004). Galor (2022) agrees, pointing out that the impact of inclusive institutions could simply be the influence of the human capital of European immigrants. The position of the three Nobel laureates probably needs to be qualified when Acemoglu et al. (2002) assert that, over the last 500 years, countries that were rich in 1500 have become poor and remain so today as a result of the misdeeds of colonisation. Their article in the *Quarterly Journal of Economics* focuses on the collapse of the Aztec empire of Teotihuacan (1519-1521), when the population was either decimated by the Spanish conquistadores or alienated by Herman Cortés. Hispanic colonial responsibility is indisputable, but the fact is that today the descendants of the Aztecs have a per capita income 1.5 to 2 times higher than that of the inhabitants of Yucatan, a gap that is comparable to the one that existed in 1500, although the Mayans' exposure to colonial rule was very different.

In pre-Columbian America, the origins of the impoverishment of the main Mayan urban
centres of Tikal and *Chichen Itza* produce an entirely different narrative. The 2002 article does
not deal with this case, which lends credence to the arguments of geographical economics.
While there are many competing scientific scenarios, the one that has held sway since the 1990s
associates the decline of the empire with internal conflicts, antagonisms between the lower
classes and the elites, and between cities vying for access to good land. These internecine wars
intensified with population growth, the concomitant worsening of droughts, and the reduction
of nutrients in the soil. The combination of these ecological factors would have heightened
tensions long before the last Mayan city fell into Spanish hands in 1697. In this case, the
institutions were gradually perverted by the ecosystem and not by the behaviour of settlers from
the *Old World*.
### III- The rule of law and its temporality

The interaction between economics and politics has been an area in which the three Nobel laureates have been prolific. Their intellectual coupling combined the hallmarks of Chicago and Harvard economics. For the economists based in Chicago, the capital of the Great Lakes and *fresh water*, to use the formula coined by Robert Hall (1976), liberalised markets and respect for property rights would generate a "spontaneous order", to use Hayek (1945,1960)'s expression. Markets are the solution while the state is the problem. The more temperate *salt water* economists, initially based on the East Coast, mainly in Boston, follow Keynes and Richard Musgrave (1959). The ideal state combines the functions of resource allocation in the presence of market inefficiencies, redistribution for the purposes of social justice, and macroeconomic stabilisation. But there is a big difference between the way the state operates and the standard of benevolence and efficiency which it holds to the community as a whole.

For Acemoglu and his co-authors, good institutions are *inclusive*. They promote prosperity, whereas *extractive* institutions produce illegitimate enrichment and benefit the elites who usurp power. Democracy and its rule of law combine the equality of citizens before the law and the possibility of political alternation, which presupposes *a priori* a multi-party system and the separation of executive, legislative, and judicial powers (Aron, 1965).<fnref n="8" /> As with North and most neo-institutionalists, it is primarily the political sphere that defines institutions and the rules of the economic game. This paradigm contrasts with that of the Marxists, where politics is an offshoot of economics. They argue that democracy must be effective. In other words, it must be *real* and not just *formal*. Hernando de Soto, a Peruvian economist, used to poke fun at the presidential elections in his country, which consisted of electing a dictator every five years, hence the use of the expression "democrature". Democratic life cannot be reduced to the moment of an election in a sham multiparty system. Farred Zakaria (1997) took up the same subject by referring to "illegitimate democracies".

History is full of examples where the obstacles to development have been caused by nepotism and the absence of institutions holding leaders accountable to their people. In *Why*

<footnote n="8">⁸ R. Aron (1965), *Démocratie et totalitarisme*, Gallimard, 370 p. For Aron, liberal democracies admit a plurality of parties and their competition regulated by laws for the conquest and exercise of power, call for constitutional-pluralist regimes. There is a dialectical relationship between a system of political competition and an economic system of competition.</footnote>
*Nations Fail*, published in 2012, Acemoglu and Robinson take a look at some of the countries that have suffered the most, those whose domestic resources predisposed them to prosperity but which was prevented by corrupt political elites. The book highlights, among others, the cases of Peru under the autocrat Fujimori, Venezuela under the authoritarian and populist Chavez, and Zimbabwe under the despot Mugabe. Acemoglu and Robinson argue that democracy and the rule of law are the vectors of prosperity. The state has to be strong and effective, capable of enforcing laws, taming violence, resolving conflicts and providing the services that the community needs. But a *Shackled Leviathan* is needed to use the authors' metaphor. It must be controlled by separate constitutional powers (*check and balances*) and by an ever-vigilant civil society.

Acemoglu, Johnson and Robinson were sure to raise eyebrows, and not just in the *Global South*. The challenge to their thesis is based less on what is said about the colonial fact than on the principle that democracy must prevail. Many see in this assertion an expression of Western arrogance, a way of making certain countries responsible for their political situation rather than seeing their economic deprivation as a manifestation of the misdeeds of imperialism (Plane, 2022). There is some truth in this. If *government of the people, by the people, for the people* is the least bad of systems,<fnref n="9" /> the sequencing of the implementation of democratic institutions raises questions. Victor Hugo disparaged "*Napoleon le Petit*". Yet Napoleon III's *authoritarian Empire* (1852-1860) was the foundation on which France's economy took off. After the overthrow of the feudal shogunate, Japan's Meiji Empire, from 1868 onwards, was also opposed to democratic devolution. Its neighbour, South Korea, the *country of the morning calm*, did the same, and its democratic transition only began in 1987. Taiwan did not wait for democracy to bring about the long phase of prosperity that we know about. Until the 1980s, Taiwan lived under the martial law regime decreed in 1949. The first genuinely democratic elections did not take place until 1996. And what about China? To forget its performance over several decades would be to refuse to see the elephant in the room. We are reminded of the pragmatism of Deng Xiaoping and his successful reflexion: It *doesn't matter whether the cat is black or white, as long as it catches mice*. The current Chinese leader would surely add the condition: *and that the Communist Party remains in power*.

<footnote n="9">⁹ Abraham Lincoln's phrase is echoed in the French constitution. In the words of Winston Churchill: "Democracy is the worst form of Government except for all those other forms that have been tried from time to time....", House of Commons, 11 November 1947.</footnote>
The democratic system has therefore not been the inevitable anchor of economic epics. And the fact that, on average, countries that have adopted it have experienced strong economic growth is not in itself proof of a causal relationship (Barro, 1996). The electoral calendar associated with political competition can even be disturbing, a source of contestation, and sometimes lethal violence (Dupas and Robinson, 2012). This is a long way from the democratic life imagined by Raymond Aron (1965): the *organisation of peaceful competition for the exercise of power*.<fnref n="10" /> Ksoll, Macchiavello and Morjaria (2016) estimated the impact of the 2008 post-election violence on Kenya's cut flower exports. The authors find that the violence induced a supply shock equivalent to a 50% contraction in exports.

In French-speaking Africa, while Senegal has always lived with the principle of representative democracy, Côte d'Ivoire has had its difficulties with its coup d'état in 1999. The disputed elections in 2000 and the civil war that ensued with the "lost decade" (1999-2011) were evidence of the excesses that can result from democracy. While prosperity has returned, with an average annual growth rate of 8%, and there has been peace for nearly 15 years, in 2023, Ivorian entrepreneurs, questioned as part of the *World Bank's World Enterprise Surveys*, still pointed to political instability as one of the two main obstacles to improving the business climate, after access to finance for small and medium-sized enterprises and the corruption that affects large firms. Entrepreneurs link investment decisions to their perception of the future. They form their expectations based on the statistical distribution of events they have experienced. The greater the uncertainty, the more the “option to wait” is favoured, particularly when investments are not reversible.<fnref n="11" /> According to the *Observatoire Ivoirien des Droits de l'Homme* (OIDH), post-election violence during the 2020 presidential election led to the death of 85 people and injured more than 500. Violence linked to the contestation of electoral polls has gradually spread to most developing countries, but it has not become established in countries where democracy has been in place for a long time. Worse still, the principle of democracy, in which one day's losers can hope to govern the next, has been shattered, leaving room for the doubts nourished by the delegitimisation of politics (Rosanvallon, 2024).

<footnote n="10">¹⁰ R. Aron (1965), *op cit* "a regime in which politicians are all aware of the collective interest they must serve, in which conflicts of ideas are unleashed to the full, but in which the press is objective and citizens retain a sense of solidarity".</footnote>

<footnote n="11">¹¹ When an investment cannot be cancelled or modified without high costs, investors trade off the information on which to base their execution decision against the assumed return of a project started immediately.</footnote>
Every democratic election therefore entails a risk. It suggests a possible return to instability, which could delay investment. In defence of these arguments, which are not in favour of democracy, Churchill's prophecy comes back to mind. Apart from the rule of law *stricto sensu* and situations of *benevolent dictators*, political regimes other than democracy have cultivated *crony* capitalism, such as that patiently constructed in Tunisia in apparent conformity with the rule of law. In a tradition of pseudo-democracy or the Weberian model of neo-*patrimonialism*, between 1987 and 2011 the Tunisian regime used regulations and laws to satisfy the interests of the family of ex-president Zine El Abidine Ben Ali, his relatives, and his cronies. According to Bob Rijkers *et al*. (2017), no fewer than 400 companies were involved in confiscation from the state apparatus for private purposes. After the *Jasmine Revolution*, the National Confiscation Commission estimated that the total value of assets taken from the community amounted to around 13 billion dollars, more than a quarter of Tunisia's GDP in 2011.

Democracy is therefore not a necessary starting point for economic take-off, but the cases where development has occurred in its absence are limited, especially outside Asia. Does this political regime become an unavoidable factor in the course of development? In *Economics Observatory*, Daron Acemoglu (2024) argues for the need for evolving rules that shape individual interactions and entrepreneurial innovations.<fnref n="12" /> For developing countries, structural transformation (i.e., manufacturing diversification), requires institutions capable of reducing the often-exorbitant transaction costs. Beyond commodities and their transformation, where the presence of rents is a factor which permits redistribution within internal value chains, international competition on manufactured products is fierce. The more standard the products, the tighter the profit margins. Confidence in inter-individual relations then becomes necessary, an *invisible institution* to use Kenneth Arrow's expression (1974). At a more advanced stage of development, promoting breakthrough innovations requires an even more supportive institutional framework. The fixed and non-recoverable costs of innovation have to be addressed. The return on investment, generally achievable over a long period, makes it imperative to protect property rights. The positive relationship between institutions and development echoes the important work of Phillipe Aghion,<fnref n="13" /> who argues that good institutions

<footnote n="12">¹² Interview by D. Acemoglu with G. Roy "What are the economic impacts of institutions and technology?", 23 October 2024.</footnote>

<footnote n="13">¹³ See, in particular, P. Aghion and A. Roulet. A (2011). *Repenser l'État. Pour une social-démocratie de l'innovation*, collection la République des idées, le Seuil, 128 p; P. Aghion, C. Antonin and S. Bunel (2020), *Le Pouvoir de la destruction créatrice*, Odile Jacob, Paris.</footnote>
stimulate the Schumpeterian process of *creative destruction*, whereas bad institutions are a blocking factor. Companies and political leaders perceive change as a threat to their *rents*, a danger comparable to the rise in human capital and the expansion of the middle class, which encourage a shift towards democratic values.

On the subject of innovation, China's trajectory is once again raising questions. The country's level of economic growth is running out of steam at a time when, in dollars and purchasing power parity terms, per capita national income is less than a third of that of the United States. Yesterday's certainties sometimes give way to doubts about the possibility of the *Middle Kingdom* ever catching up with the American standard of living. At an advanced stage of development, is the absence of pluralist democracy an obstacle to economic and social progress? Is the infrastructure, to borrow from Marxist phraseology, held back by the superstructure of the totalitarian regime? Nothing is less certain.

In 2023, the *Australian Strategic Policy Institute* (ASPI) stated that out of 44 emerging technologies identified, China had built up a significant lead in 37 of them, however this assertion has been challenged. Chinese patent production is said to be more about incremental innovation than disruptive innovation, as is the case in the United States. The debate around artificial intelligence, on the respective merits of California's *OpenAI* and Hangzhou-based *DeepSeek*, has provided food for thought. Some point out that half the world's artificial intelligence researchers are currently based in China. At this stage, therefore, the die is not cast, *especially at* a time when Western democracy is revealing its functional weaknesses while at the same time providing a prime target for authoritarian regimes. The debate remains as open as ever. In many countries, Western-style democracy resembles a *Potemkin village*, as the terms *democrature* or *illiberal democracies* suggest. More than formal institutions, authors stress the importance of trust, which is based on the ability of politicians to reproduce performance from period to period. Strong growth, such as in China or Rwanda, with an average rate of 8% since 2000, becomes a source of legitimacy for authoritarian regimes through self-reinforcing confidence. This is in stark contrast to the stagnant growth of some democratic countries, where a lack of performance has created a relationship of mistrust between the people and their rulers (Besley *et al.* 2025, Besley et Dray, 2024). The relationship of trust that is established between the state and its citizens is an alternative to the effectiveness of the state through coercive relations (Besley and Dray, 2024).
IV- From colonisation to contemporary migration

Acemoglu, Johnson and Robinson have focused on the impact of political regimes and
the complex relationship between colonisation, institutions, and prosperity. By way of
symmetry, the same reasoning can be applied to contemporary international migration. Are
they necessarily neutral for the host countries? Current population movements obviously have
little to do with colonisation. They are spontaneous, the result of decentralised decisions by
individuals and family networks in search of improved well-being and a move to serenity
outside conflict zones. Colonisation, on the other hand, was a generally violent political
strategy, a desire on the part of States to bring territories and populations under their control, if
necessary, through settlement initiatives.

International migration is a sensitive issue, and one that is hotly debated, starting with
the size of the flows in question. In France, Hervé le Bras (2022) suggests that there should be
no debate. The flows are statistically known, stable compared with their relative level in 1990.
Any doubts about the truth of the figures would simply be the expression of political
manipulation. The new populations are integrating like previous migrants, in line with the social
norms of their host country. Michèle Tribalat (2022), also from INED, takes issue with this
view, which she likens to a "denial of reality" and a "lack of rigour" in the processing of
statistical data. Against this backdrop, who can still doubt that the human sciences are not
political? 20 years ago, Daniel Cohen (2006) observed that international migration meant that
current globalisation was lagging behind the situation that prevailed in 1913.<fnref n="14" /> Is the
comparison between these two years well-founded? Between 1870 and 1914, the majority of
flows were in response to the needs of expansion in North America (USA, Canada) and South
America (Argentina, Brazil). Immigration was required to support the development of industry
and agriculture. In the United States, public land was given to migrants free of charge under the
*Homestead Act* (1862-1930). In Argentina, the Immigration Act of 1876, known as the
*Avellaneda Act*, organised and encouraged the arrival of immigrants by making it easier for
them to settle. Between 1870 and 1931, more than 6 million people entered the country as a
result of public incentives. Migration supply naturally met demand.

Inaugurated in 1892, Ellis Island (New York) became the gateway for millions of
Europeans seeking to emigrate to the United States. On arrival, people were subjected to

<footnote n="14">¹⁴ In 1913, 10% of the world's population were immigrants - i.e. people living in a country other than their country of birth - compared with 3% in 2012.</footnote>
medical tests and interviews designed to filter out those at risk, and turn away undesirable people, particularly criminals, and people with no resources who would be a burden on society. Ethnic restrictions were gradually introduced. The *Chinese Exclusion Act of 1882* banned Chinese nationals from entering the country on the grounds, among others, that they had difficulty integrating into the fabric of the nation. The *Emergency Quota Act* of 1921 and then the *Immigration Act* of 1924 introduced quotas by nationality and tightened the exclusion criteria. The origin of migration flows would therefore not be neutral for national institutions.

Contemporary movements, particularly towards Europe, are very different in nature. They are less and less associated with the call of the host countries, and rarely linked to employment contracts as was the case in the past. Their spontaneous nature creates economic immigration, which is often illegal. In a way, these movements, which are both spontaneous and poorly controlled, are similar to internal mobility, between rural and urban areas, albeit with greater human and financial costs. In the same way that colonisation left its mark on development processes, is international migration likely to modify institutions and influence the prosperity of host countries? When settlers exported formal institutions to Africa, it was difficult for them to coexist with local social norms and conventions, thereby modifying internal social relations (J.-P. Platteau, 2000). By analogy, contemporary migratory movements can instil confusion in values and disrupt the social order.

Driven by mutually beneficial economic considerations, migration has historically been a boon for countries in both North and South. The latter are less well-known, but Côte d'Ivoire, for example, has benefited greatly from the employment of agricultural workers from Mali and Burkina Faso in its cocoa plantations. The number of these workers, initially employed on a seasonal basis, has expanded considerably and some have become permanent. The law of numbers eventually led to absorption problems in the host country. As Sachs (2003) reminds us, this population dynamic was not neutral in the question of Ivorian identity, which was at the root of the civil war in the 2000s. <fnref n="15" />

In the Sudano-Sahelian region where the ecosystem is increasingly inhospitable, the demographics of the Alliance of Sahel States (ASS), made up of Niger, Mali and Burkina Faso, foreshadow the migration dynamics that lie ahead. At the end of the 1970s, the three countries had fewer than 19 million inhabitants. In 2023, they had a population of 73 million. Even if the

<footnote n="15">¹⁵ J. Sachs (2003) *op cit.* "After a rural exodus, the host country often experiences political upheaval. The mass exodus from Burkina Faso to Côte d'Ivoire is one of the reasons for the recent ethnic and civil unrest. p 40</footnote>
projections vary from one source to another, by 2050 the population may exceed 150 million. Given the ecosystem and its transformation, this demographic trend will be difficult to reconcile with the legitimate aspirations of populations to raise their standard of living within a framework of inclusive economic growth.<fnref n="16" /> Following the reasoning of Sachs (2003a), there are three main options for dealing with demographics on this scale: impoverishment, migration, and external aid. While this range of solutions may seem restrictive, with global warming, the difficulties of bringing about a lasting improvement in public governance and the contraction of aid flows, of the three options, the first two are the most likely, with the first providing fuel for the second.

For the ASS, the countries of the Gulf of Guinea, but also the Maghreb, are on the front line of migration. Episodic forced returns of migrants bear witness to this (Ben Saâd, 2017). In 2025, relations between Niger and Algeria were seriously strained. In the first few months of 2025 alone, 6,000 migrants were expelled to the north of Niger. This wave of returns is unprecedented, according to the military regime in Niger, whose behaviour has become ambivalent since the repeal of the 2015 law criminalising migrant smuggling. The other Maghreb countries are doing the same, notably with funding from the European Union, which aims to stop illegal flows.

The influence of these movements on the well-being of host countries is not limited to the effects proposed by price theory and the canonical form of general equilibrium: reduced tensions on the labour market and improved competitiveness through factor costs, higher output and domestic demand, etc. For neoclassical economists, the total cost of production is simply the expression of factor costs. They argue that transaction costs do not exist, institutions are a fiction reduced to the axiomatics of competitive markets and the rational agent, augmented by the role of *Musgravian* state intervention. This representation may satisfy the needs of mathematical formalisation, but it is based on a fictitious society. Arrow (1974) pointed out the limits of general equilibrium modelling and the postulate of perfect markets. Mathematical rigour and abstraction cannot ignore the concrete realities of socio-economics. Strictly speaking, production costs are increased by transaction costs, which potentially increase further when societies become more culturally fragmented. The challenge for institutions, when they react to changes in the environment, is to reduce these costs. The men and women who drive

<footnote n="16">¹⁶ According to the latest UN report on world demographic prospects, figures taken from the website of the Direction Générale du Trésor, French Ministry of the Economy, Finance and Industry. The population figure for 2050 is 153 million.</footnote>
migration are not ahistorical. They are the bearers of values and rules of behaviour that spread
with all the more impact in the host country as the number of new arrivals increases and cultural
differences become more pronounced, fuelling the communitarianism against which American
society has taken action without being entirely effective.

In his 1905 book, *The Protestant Ethic and the Spirit of Capitalism*, Max Weber emphasised the role of religion. Protestants, he said, empathise with capitalism. Work and social success are the "sign of being in the grace of God". Thrifty, they have a sense of saving that enables accumulation. Reliable, they reduce the risks in inter-individual commitments. This thesis, already criticised by Schumpeter, was obviously not based on refutability testing procedures as would be required today. Becker and Woessmann (2009) have statistically shown that what Weber attributed to religion could be reduced to a human capital effect. But Weber's perspective has the merit of clearly positing the hypothesis of the inequality of cultures under the umbrella of capitalist development. After 1685 and the Edict of Fontainebleau, France condemned between 200,000 and 400,000 Huguenots to exile for failing to assimilate this lesson. This brain-drain delayed France's economic take-off for several decades, while at the same time creating a great deal of prosperity, particularly in Prussia and the United Provinces, now part of the Netherlands.

A new dynamic is now at work in the formation of institutions. The propensity for
communitarianism in large-scale population flows is now a challenge to social cohesion and
the costs of exchange. In a world of egoists, effective inter-individual cooperation emerges
when trust enables the future to be given greater importance than the present, when people agree
to pay the costs of collective action, and when individual interactions are sufficiently frequent
to promote behavioural reciprocity (Axelrod, 1984).<fnref n="17" /> Reciprocity between strangers may exist,
but it is not self-evident. In interpersonal relations, Rosanvallon (2024) shows how merchant
credit, which goes hand in hand with trust, has historically been embedded in social relations
governed by geographical proximity and the repetition of exchange. In the sphere of production
and inter-firm relations, Williamson (1985) hypothesised that the manifestation of opportunism

<footnote n="17">¹⁷ Sylvie Ponthieux mentions this definition of trust given by J. Coleman (1988). "Social capital in the creation of human capital", *American Journal of Sociology*, vol 94: S95-S120: "*Trust is the expectation that arises in a community from regular, honest, and cooperative behaviour based on commonly shared norms*" (p. 36); it enables people to associate with others, and to "*work together toward common ends within the groups and organisations that make up civil society*", p 22. The phase is taken from S. Ponthieux, *Le concept de capital social, analyse critique. Contribution to the 10<sup>th</sup>Colloque de l'ACN*, Paris, 21-23 January 2004.</footnote>
was a likely result of random encounters with no end in sight. The search for maximum
instantaneous profit is therefore rational. Hence the need, in inter-firm contractual relations, to
put in place safeguards, in particular *hostage* exchanges against the risk of *hold-ups* in the case
of transactions involving specific assets outside the competitive market.<fnref n="18" />

Reciprocity between strangers requires institutions that guarantee a social order compatible with the general well-being. This reciprocity becomes uncertain when values lose their legibility and become dissonant, accentuating the information deficit. In this context, economic rules no longer help to limit transaction costs, and cause or increase inefficiencies in the functioning of both the labour and capital markets (Stiglitz and Weiss, 1981). Communitarianism instils uncertainty into the rules. Interpreting the rules generates entrenchment and additional transaction costs. In some Muslim countries, the application of Western commercial law, itself heterogeneous, coexists with the principles of the Sharia, the interpretation of which differs from one country or even region to another. As a result, the quality of trade is affected by heightened uncertainty. Trust takes time to develop, but it is not immutable. We are watching helplessly as it is being eroded, even in developed countries where living together and social capital are in dire straits. Putnam (1993) has dealt extensively with this issue in the United States and Italy. It has also been addressed in France, where pioneering ideas were put forward in *La Société de confiance*, the masterwork published by Alain Peyrefitte in 1995.

The *ethos of trust*, to use Peyrefitte's expression, has been revisited in more recent books and articles by Yann Algan, Pierre Cahuc and André Zylberberg. For these authors, distrust and uncivil behaviour are fuelled by the education system, by the corporatism and statism of the French social model, and by inequalities (Algan and Cahuc, 2014). Daniel Cohen (2022) focuses on the consequences of de-industrialisation. These arguments are valid, but they do not exhaust the explanation of the phenomenon. It is true that the disruptive liberal universe has in fact shifted the lines of the social contract. In France, however, the collective protection of the individual remains one of the most extensive in the world. Inequality, measured after the Gini has been adjusted for public transfers, is much lower than in most developed countries. We must therefore assume that tolerance of inequalities in income and wealth is lower in France

<footnote n="18">¹⁸ In Williamson (1985)'s terminology, *hold-up* is a situation in which, in a contract, once one party has made a specific investment, the other party can take advantage of this to renegotiate the terms to its advantage. To counteract this *ex-post opportunism*, *hostages* constitute specific guarantees or commitments that serve to secure the contractual relationship.</footnote>
than elsewhere. De-industrialisation is a feature common to most countries, whatever their level of development. Countries such as Sweden and Denmark have themselves entered social turmoil without being affected by the corporatist egoism, statism or rejection of inequality of liberalism. In the movement towards "social anomie" - i.e. loss of bearings and weakening of values - the impact of migratory movements should not be ignored.

In his analyses of the structure of social ties, Mark Granovetter (1973, 1985), a leading figure in the *new economic sociology*, emphasises the influence of *strong ties* with relatives and close friends. They are reassuring and protective. But the *weaker*, more distant *ties* are a sign of openness to society, and generate innovations and opportunities that are more favourable than those of the "entre-soi". As Cohen (2022) points out, the propensity for reciprocity is the *bedrock of the social world*, but he notes that without appropriate institutions, this "reciprocity can produce sanctity as well as vendetta". Breaking a bad dynamic involves reaffirming the coercive power conferred by the monopoly of *legitimate violence*. The rule of law in developed countries, where individual freedoms are the product of a long history, has difficulty coping with uncontrolled illegal migration. Illegal migration generates frustration and potentially deviant behaviour on the part of some, and xenophobia on the part of others.

In the 1960s, Sweden became a land of labour immigration with nationals from several European countries. These populations rapidly blended into society without altering the country's social cohesion. In his reading of capitalism, Michel Albert (1991) contrasted the liberal Anglo-Saxon model, centred on the competitive market and individualism, with Rhenish capitalism. Swedish social democracy has drawn on the second paradigm, concerned with cohesion within the national space, the principles of the welfare state and social relations based on trust and solidarity. At the end of the 1990s, and even more so in the decades that followed, refugee populations that were much more heterogeneous than their predecessors became residents. By 2020, the proportion of residents of foreign origin had risen to 25.9%. The result was a clash with the Swedish cultural norm. Certain fringes of this population have been the driving force behind trafficking of all kinds. The Swedish economic model had undoubtedly run out of steam, shaken by the global liberalism that had distended social relations and the welfare state model. But the new influx of refugees fuelled unprecedented violence, prompting a drastic review of a policy that had hitherto been liberal.<fnref n="19" />

<footnote n="19">¹⁹ Maria Malmer Stenergard, Sweden's Minister for Foreign Affairs: "We can't go on like this. People must of course be allowed to bring their own culture with them, but we must demand that they respect the fundamental values and liberal democratic principles on which our society is based, as well as</footnote>
Assimilation, which does not imply erasing the memory of the country from which we come, will be more beneficial than communitarian confinement, more generous in extending the weak ties that form the fabric of the nation. On 11 March 1882, in his famous lecture at the Sorbonne, Ernest Renan took note of the tumult of history and came to the conclusion that citizens will only maintain the "soul" of the nation if they forget many things about their origins. At the very least, this forgetting, which determines the capacity for absorption while respecting the national identity of the host country, is a matter of time. Ashraf and Galor (2013) have shown that the long history of migration suggests a non-linear relationship between genetic diversity and economic development. Through cognitive complementarity, this diversity can fuel innovation, creativity and productivity, but it can also become a factor of reduced cooperation and weaker social cohesion, or even of conflict and fragmentation. In *The Journey of Humanity and the keys to human progress*, Oded Galor (2022) supports the idea that diversity promotes the cross-pollination of minds, without overlooking the fact that it can at the same time lower the level of internal trust, and, ultimately, the ability to promote trade, and economic prosperity. Referring to Italy, Galor (2022), following Robert Putnam *et al*. (1993), indicates that the original social capital was persistent among southerners who migrated to the north.<fnref n="20" /> Giavazzi *et al*. (2019) point out that religious beliefs and moral values can persist for up to four generations of migrants to Europe and America. Could the inertia of these cultural traits mean a lack of impact on prosperity? Galor (2022) rejects this hypothesis and points out that, by evolving less quickly than technology, these invariants affect development, something that neither Max Weber nor Werner Sombart would deny.

The law, and institutions more generally, are adjusting too slowly to the upheavals in the international environment. The lack of political reaction risks creating juxtapositions of informal and communitarian institutions that compete with the system of formal values thought to have been established through a long process of sedimentation. Contamination phenomena

<footnote>learning Swedish and being financially independent. Immigration must be drastically reduced for a certain period of time". In: *Politique internationale*, No. 181 - Autumn 2023. More recently, in May 2025, the Prime Minister of the United Kingdom, Keir Starmer, spoke in the same vein, pledging to "regain control of our borders" and asserting the need to strengthen the "rules of the nation" so as not to become "an island of foreigners". In the countries of the south, the same observation was made, sometimes in excessive terms. In February 2023, Tunisian President Kaïs Saïed sparked outrage in the international community after declaring that the *hordes of illegal migrants are a source of violence, crime and unacceptable acts*. He added that the arrival of sub-Saharan migrants was weakening Tunisia's Arab-Islamic identity.</footnote>

<footnote n="20">²⁰ O. Galor (2022). *op cit* and R. Putnam, R. Leonardi and R. Nanetti (1993), *Making democracy work - Civic traditions in modern Italy*, Princeton University Press.</footnote>
point to the dangers of laissez-faire. Today, Canadians are identifying the difficulties of making
a *reasonable accommodation*, which respects collective identity, an effective means of social,
economic and political integration. Proselytising communitarianism, to which social networks
can give free rein, if necessary, with the support of foreign powers or organisations, is clearly
a threat to representative democracies that are already struggling.<fnref n="21" />

The issue of migration is one of the points of contention, yet we have known since John
Locke (1632–1704) that consent to authority is based on trust. Without it, legitimacy is lost.
The trilogy of *invisible institutions*, the matrix of social relations evoked by Pierre Rosanvallon
(2024) in his best-selling book, is being dangerously altered. The loss of political *legitimacy* is
leading to an erosion of *trust* and a lasting weakening of *authority*. Paul Collier (2013) offers a
pragmatic view of the challenges and issues surrounding international migration, a phenomenon
that the author considers to be of major importance for the 21st century. Population movements
bring both opportunities and risks as migration dynamics intensify and countries of origin
become more culturally diverse. Present flows disrupt the balance between labour supply in
countries of origin and demand in host countries. In both the South and the North, the question
of immigration tolerance thresholds has clearly been raised. Questions are being asked about
the implications of these population movements for social cohesion and identity, and for the
quality of the formal and informal institutions that determine both the functioning of the
economy and civil peace. It is a sensitive subject, but there is little doubt that it cannot be
ignored anywhere in the world and that it will become increasingly acute. The absorption
capacity of host countries is not infinite.

<footnote n="21">²¹ Where appropriate, international migration can be exploited. Commenting on the migration crisis at the Polish-Belarusian border and Lukashenko's behaviour, Ursula Von der Leyen, President of the European Commission, on a visit to Washington, said: "*This is not a migration crisis. It is an attempt by an authoritarian regime to destabilise its democratic neighbours. It is the whole of the EU that is being challenged*" Le Monde, 12 November 2021, "Biélorussie: ne pas céder au chantage de Loukachenko".</footnote>
## V- Conclusion

The role of institutions in development continues to pose questions. Institutions act as a cement for social cohesion, peacefully governing individual interactions and clarifying the rules of the collective game in terms of economic incentives and sanctions. By giving visibility to the future, they encourage accumulation, and, in so doing, economic prosperity. Their importance to the economist is reflected in the number of Nobel laureates who have dealt with the subject, directly or indirectly. Acemoglu, Johnson and Robinson are just the latest on the list of laureates. Following North, institutions have been analysed in the same way as technical progress, of which they are a component, exogenous in the short term but endogenous in the long term. From period to period, institutions usually improve the environment, but with risks of reversibility illustrated by the middle-income trap. In Argentina, from 1946 onwards, the great leap backwards caused by the *National Justicialist Movement* of Juan Perón and his successors provided proof of this point. In 1913, in 1990 dollars, Argentina's Gross Domestic Product was $3,800. This was 47% higher than Italy's and 60% higher than Spain's, while Japan's GDP per capita was 2.7 times lower (Madisson, 2001, 2003). The rest is history

After the collapse of the Communist bloc, Francis Fukuyama (1992) announced the end of history. The combination of the democratic rule of law and market efficiency was to become the driving force behind smooth international development. In this ideal world, *inclusive* political institutions produce *inclusive* economic institutions for the well-being of humanity (Diarra and Plane, 2014, 2012). At least temporarily, Huntington's (1996) representation trumps Fukuyama's and the theory of “gentle commerce” to which Montesquieu attached such importance. Civilisational conflicts are intensifying and posing a threat to global stability. On the fringes of these opposite points of view, Huntington (2004), in a book slightly less high profile than his previous one, evoked the risk of *balkanisation of the United States*, a country where integration has gone hand in hand with the communitarianism inherent in massive waves of migration: around 25 million between 1880 and 1924, and 50 to 60 million since 1965. His pessimistic, culturalist interpretation of immigration was seen as a threat to national cohesion. A nation's identity is not fixed. The social construct is evolving, but there is a capacity for absorption that is not infinite and which means that we must not gloss over the problem at the risk of ruining the "common good" referred to by Jean Tirole (2016), which is based on material well-being, on the reconciliation of individual and general interests, but also on non-market values and institutions that shape the way we live together.
The future is not written anywhere, but the subject of institutions and their impact cannot be clarified without taking interdisciplinary complexity into account. Bernard Walliser (2001) reminded us that by becoming too self-centered (autistic), a discipline such as economics runs the risk of entering the zone of diminishing returns. The three Nobel prize winners of 2024 offered an economic approach to development, enriched by the contributions of the other social sciences. We can only hope that their research will stimulate new thinking and contribute to a better understanding of institutions as they relate to development and population movements.

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