26 January 2010 12:00AM
Why are some societies relatively rich and others relatively poor? This is perhaps the most fundamental question in all of economics. Although aspects of the issue remain unresolved, there is a consensus among economists that well-defined property rights, low and stable inflation, and reasonable regulatory and taxation regimes are conducive to growth. In short, markets do produce the goods.
But what produces the institutions that are necessary for the development of a well-functioning market system? That is the question that economist Timur Kuran of Duke University has been asking recently. In particular, his work has led him to wonder why the Middle East, probably the most prosperous region of the world in the Middle Ages, failed to grow in the way that Western Europe has during the last several centuries. The product of that research will appear in 2010 with the publication of his book Islam and Economic Underdevelopment: Legal Roots of Organizational Stagnation in the Middle East.
Kuran has been interested in the economics of religion for many years, but much of his early work was on a very different topic: What are the incentives that lead people often to express a certain preference privately but another publicly — and what are the public policy implications of such “preference falsification”? Before coming to Duke in 2007, Kuran taught at the University of Southern California for 25 years. He also has held visiting positions at the University of Chicago and Stanford University.
Aaron Steelman, the editor of The Federal Reserve Bank of Richmond's magazine "Region Focus," interviewed Kuran last fall.
Learn more about the Federal Reserve Bank of Richmond's publications. The views expressed in Region Focus are those of the contributors and not necessarily those of the Federal Reserve Bank of Richmond or the Federal Reserve system.
Economics Department