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Strategies & Market Trends : Mish's Global Economic Trend Analysis
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To: Cogito Ergo Sum who wrote (106970)1/20/2010 7:55:32 PM
From: Joe Btfsplk1 Recommendation  Read Replies (1) of 116555
 
Lot of years since I read him, but Mancur Olson made interesting points over why ever accumulating insults cause nations to eventually stagnate or fail. A taste from Wiki:

In 1982, he expanded the scope of his earlier work in an attempt to explain The Rise and Decline of Nations

. The idea is that small distributional coalitions tend to form over time in countries. Groups like cotton-farmers, steel-producers, and labor unions will have the incentives to form political lobbies and influence policies in their favor. These policies will tend to be protectionist and anti-technology, and will therefore hurt economic growth; but since the benefits of these policies are selective incentives concentrated amongst the few coalitions members, while the costs are diffused throughout the whole population, the "Logic" dictates that there will be little public resistance to them. Hence as time goes on, and these distributional coalitions accumulate in greater and greater numbers, the nation burdened by them will fall into economic decline. Olson's idea is cited as an influence behind the Calmfors-Driffill hypothesis of collective bargaining.
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