Odd Lots - James Robinson on What It Looks Like When a State is Failing

Episode Date: October 21, 2026

The third and last episode from our Chicago live show is with James Robinson, a professor at the University of Chicago and a recipient of the 2024 Nobel Prize in economics (which he shared with Daron Acemoglu and Simon Johnson). His most famous work is 2012's Why Nations Fail, and in that book he and his co-author Acemoglu document the institutional factors — whether it is reliably run elections or open markets that help facilitate innovation — that determine why some states thrive and others don't. So we ask Robinson the big question: What would have to happen for the US to be considered a failed state?Read More: ‘Middle Powers’ Grapple With New Survival Strategies Under TrumpOnly Bloomberg.com subscribers can get the Odd Lots newsletter in their inbox, plus unlimited access to the site and app. bloomberg.com/subscriptions/oddlotsSee omnystudio.com/listener for privacy information.

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Bloomberg Audio Studios, Podcasts, Radio News. Hello and welcome to a very special episode of the Oddlots podcast taped live in Chicago. I'm Tracy Alloway. And I'm Joe Wisenthall. Joe, there's a lot to talk about when it comes to institutional failures now.

Yeah, absolutely true. You know, there's a lot of people, they talk about geopolitics a lot, and of course there's multiple wars going on. But I also think that if you're in the markets these days, just think about the economy, you actually just have to talk about politics, politics. You really do.

And so I'm very happy to say that we have the perfect guest, Someone who's actually never been on the show before, but I think a lot of listeners will have heard of him because not only is he a Nobel Prize winner, he is also the author of the very famous book that you and I have probably read a couple times now called Why Nations Fail. So we're going to be speaking with James Robinson. He is, of course, a professor at the University of Chicago. Hope you enjoy the conversation. Well, Professor Robinson, thank you so much for joining us. Really appreciate it. My pleasure.

Why do Nations fail? No. Okay, let me ask the other obvious question right now. I'm just going to get into it. Is the U.S. a failing nation? Oh. How long do we have? No. Okay, good. Not yet. Not yet. Yeah.

Wait, I have one more random question. Do you call yourself a Nobel Prize winner or do you say, like, you're a Nobel Prize winner, right? I think it's a real Nobel Prize. Well, you know, there's some debate about it. that, you know, because Alfred Nobel didn't actually specify a prize for economics, you know, and it came later on.

Yeah. So, you know. It's a Nobel Prize. You're a Nobel Prize winner. I think you should just go for it. Yeah. I've got the badge. Oh, there you go. All right. The U.S. is not a failed state. Is it

or failed nation? Is it failing? No, I mean, you know, by failure, you know, we're really talking about economic failure, economic success. Failure is a big word. It covers lots of things. So, you know, my work is really about economics and about how societies who succeed economically do so because they create institutions, sets of institutions, kind of rules that channel people's energy, you know, in directions which are socially beneficial innovation, entrepreneurship, creativity. but those energies can be channeled in many different ways

and I think what you see in the United States historically is you've had very what we call inclusive institutions, institutions, rules that are created very broad-based patterns of incentives and opportunities, economic success, and poor countries like Venezuela say went into decline because they created the opposite, which we call it, we call it, extractive institutions.

They don't create broad-based opportunities or incentives. They create incentives of very narrow cliques, the chavistas, and most people are just excluded from opportunities. So I think the history of the U.S. has been a remarkable success story, but I think, as we point out in our work, in any society, there's always challenges to inclusive institutions. Some people were doing very well in Venezuela out of that system. So I think, you know, there's always challenges, and there's been a history of challenges in the United States, by the way. You know, it's not a simple, you know, good guy, bad guy story.

But the thrust of your work, if I understand it, is that typically in economics, when we talk about what's good economic policy, it's like, well, maybe we should have an independent central bank, maybe we should have a tax system that doesn't penalize productivity, et cetera, and all that may be true. but all of this is downstream essentially from politics, right? Is this the idea that there is no way to just set up, write down a list of good economic policies if the institutions and politics aren't there in the first place to be conducive to it? Yes, absolutely.

Great. That's right. I mean, I think all that stuff about economic policy and economic institutions are all important, but the politics has to support that, absolutely. Yeah. How did you actually develop that approach? Because when we think about economics, I mean, we often think of traditional economics as a model that says if X happens, then why is the result?

It's all very formulaic versus your approach that really emphasizes, I guess, the politics, the institutional strength. And you also emphasize, I guess, critical junctures in history where things could have gone either way. I was trained as an economic theorist, you know, and when I finished my PhD in 1992, I just, I had this kind of epiphany, and I realized I just, I was very interested in these problems, particularly of developing countries, and I realized I just didn't understand anything. And the first place I sort of, so I just needed to start immersing myself in some sense. And the first place I did that actually was in Colombia, interestingly enough. And when I got to Colombia, I realized I have no way of understanding what's going on here.

And I just had to kind of back up and start asking myself, why do things happen the way they do? And then the politics just looms incredibly large. I think about Venezuela. How can you understand the economic trajectory of Venezuela or all those mistakes without understanding the politics of Chavez and Chavismo or even before that? So all of this makes a lot of sense, and I find it very intuitive. but I also have an issue with, I guess I would say there's maybe a certain non-disprovability issue that I think about, which is that you say, okay, here's a rich country like Britain and the U.S. They say they must have good institutions.

And then here are some countries that are poor, Venezuela, et cetera, Argentina. And you say, oh, they have bad institutions. But if we're only looking at the outcome, how do you actually establish sort of, I guess, a priori, that that is the actual thing. Let's say you didn't know anything about the economy. You were looking at something about a country, but you were not given privy to GDP growth, anything like that. Are there other ways to know whether that country has good or bad institutions?

I mean, you know, what we got the Nobel Prize for, me and my collaborators was sort of trying, sort of establishing empirically this connection between institutions and economic development. But, you know, that's a hard question to ask. You know, you could look at life expectancy. You can look at infant mortality. You know, I think when you look at most failing countries,

failing economically, yeah, they do badly in terms of income per capita, but they do badly in terms of most socioeconomic outcomes also. You can even look at nightlight. You know, the most famous photograph we have in our book is the Korean peninsula at night. It's getting brighter, the North Korean peninsula. It's getting a little brighter. maybe the presidential palace in Jiangyang. There's a wave pool.

You need, you know. You've mentioned Venezuela a couple of times. Can you just apply your framework for us to Venezuela under, I guess, Chavez and Maduro, and then Rodriguez now? Well, I think, you know, that comes into path dependence, as you mentioned. Like, I think, you know, if you look at the history of the Americas, if you look at this economic divergence between North America and Latin America, you know, that's very very. deeply rooted in history. It's rooted in the way very different types of societies got created in the colonial period. In Latin America, you see societies based on coercion of indigenous people, on slavery, you know, and that created hierarchy. You know, it created very extractive institutions. And that led to poverty. And, you know, I think, you know, if you look at the United States, of course, that's a complicated picture.

So the U.S. South had what we were called extractive institutions. But for us, you know, and of course the South until very recently was poorer than the rest of the country, it was less urbanized, there was less industry. But, you know, the key thing is that when the U.S. institutional framework got kind of definitively set up in, you know, with the Constitution, it's really the North that somehow really created that, you know. So there were compromises. Actually, can you explain this is a little bit of history? because when they landed in the U.S., they were hoping to replicate the extraction of South America.

It didn't work the same way. Why? Yeah, I mean, that's a fascinating story that with the Jamestown colony, the origins of the Jamestown colony, you know, the colonists came with a model of how you colonize the new world, which is actually completely based on the Spanish conquest of Latin America. It's just that you couldn't, there were no indigenous people to exploit in Virginia. And, you know, there's a whole sort of farcical early history where the English settlers try to set up a model exploiting indigenous people.

In the meantime, they didn't bother planting any crops and two-thirds of them starve to death because their model was, we don't work. We exploit the indigenous people. And when that model crashed and burned, then they had to kind of experiment with other types of models, including, we need to get British people to come here. So how do you get them to come? then they created a much more inclusive set of political and economic institutions because they realized, you know, of course, this was before the slave economy takes off.

They realized that, you know, to have a viable economy here, we need to get people to come. And so then there's this institutional transition, you know, and Virginia creates this legislative assembly with universal male suffrage, which is a sort of unprecedented innovation. There are some market stories where you want to be. want every detail. Joe and I have made quite a few podcasts on that basis, but sometimes you've only got 10 minutes and just want to know what's moving markets. Fast. That's the Barclays Brief Podcast. Every week, experts from Barclays Markets and Research get you up to speed on what's happening and what to watch next. Concise, focused, and brief. Search Barclays Brief wherever you get your podcasts.

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Grab the free app. IHart Radio. Everywhere you go. Always free. Download the free IHard Radio app today. Just going back to Venezuela. So with Rodriguez now, like how did, like how would you, is that system still an extractive system.

Absolutely, yes. Say more. And we're not doing anything about it, and we should be. Well, this relationship that now US and Venezuela have, or Marco Rubio and Rodriguez have, what is there an interesting parallel in history? Is this an unusual relationship? I think it's not so unusual.

I mean, I think if you look at the history of US relations with Latin America, you see. see similar things, you know, U.S. in the past occupied Haiti and, you know, Hispaniola and, you know, so there's the United Fruit Company. It's not ridiculously anomalous, no. This is going to be a devil's advocate question. I just want to make that very clear before I say it. But is there a path where accountability to the U.S. for Venezuela could lead to more domestic, democratic accountability? in Venezuela?

Yeah. I think it's very difficult for any outside power to sort out these problems, you know, in some sense. Like what my research shows is that, you know, countries that make a transition from more extractive to more inclusive institutions, they do it because they find a way themselves or they sort it out themselves, you know, like Chile, for example. So, you know, Chile is by far the most successful economy in Latin America. has the best functioning institutions. That was the Chileans that did that. So I don't think the US can really solve that problem in Venezuela. I think they could probably not exacerbate it,

but I'm not sure that they're able to solve that problem. And I think it's an interesting question. So I wouldn't say Latin America is the way it is because of the way the United States. Sometimes it's interacted in a very dysfunctional way, but I don't think the United States is responsible for the problem. That's much more deeply rooted historically. You know, you have a very big fan these days. The new president of Syria, I believe,

who used to be a jihadi not that long ago, is now, like, Mr. neoliberal, like, going and, like, speaking at, like, I don't know, like the Atlantic Institute in Brookings, and he's like, I read why nations fail and stuff like that. first of all, that's, what's that like? I'm waiting for the call, you know, he hasn't called me yet. Let's say he does call. He's like, I really like your book, but now I got to put some of this institution

building into practice. Is there a model for like, okay, let's build some durable, inclusive institutions that he could reach for? Is there another country where it's like, you know what, follow their playbook? That worked. Yeah, I mean, I think that's very complicated, you know, because I I think, you know, what our research shows and, you know, the way we've approached this is, you know, if you want to compare all these different countries and today and historically, you need a sort of,

you need concepts which are sort of flexible enough to cover a lot of details. You know, if I talk about inclusive and extractive institutions, of course, the details of those things are very different. But if you're in the business of actually advising Syria, which I'm not in this business, advising Syria or anywhere else, actually. You know, then all the details Because he's listening

your phone line is open. I'm like, you know, what I'm happy to do is, you know, people want to talk to me and they want to ask me questions about what I know and what models

might be helpful for them. I'm happy to engage at that level. Okay. But, you know, to do anything useful for Syria, you'd have to understand the details of the politics and the institutions

and the society, and of course I don't. Well, this kind of gets to one of the criticisms from your famous non-fans, which was Bill Gates. So Bill Gates wrote a book review of Why Nations Fail, and he kind of criticized you for explaining why strong institutions matter, but not explaining how to actually get them. What's your response to that particular criticism? Well, you know, institutions are kind of, you know, like they're an outcome of a sort of political equilibrium, I would say.

So our research has been about trying to describe those equilibria and trying to describe sort of historically why some parts of the world got into the situation that they did. And so changing them, that's something completely different. So we try to describe historically why society's changed and how they changed. But the idea that there'd just be some lever that you pull in Syria that seems a bit kind of simplistic to me.

You know, so I, you know, I, you know, he has a very simple view of the world, I suppose. You know, he sort of thinks, he thinks like an engineer, you know, but, but social, social systems are not like, you know, they're not like computer programs. So we started off with like the very aggressive, loaded question is you as failing, you know. And now we return to it. Well, no, yes, kind of. We look at the United States these days, and people are certainly, like, you know, setting aside failing. There are institutions, like, people are worried about the future of an independent central bank. People are worried about, like, is there a voting system going to be durable and so forth?

Like, are there patterns of this? Does this look like anything familiar when you look across the country of, you know, across the landscape of failed nation? I mean, I think there's lots of problems in this country, honestly. You know, for me, President Trump and all of that is, you know, he's a symptom of people's discontent. You know, if you look at data on people's trust in institutions in this country, it's absolutely horrifying. You know, so there are real problems here. A lot of people are very unhappy with what's been going on, you know, with their opportunities, with the societies. And in some sense, you know, you could think of this as a big failure of inclusion in this country.

I mean, if you don't have a college degree, you know, which is the sort of narrow majority of people in this country, you know, your income is no higher than it was 50 years ago. It's absolutely astonishing. So that's a failure of inclusion. So there are problems with institutions and they need to be addressed. And I think he's a symptom of there's problems and we need to solve these problems and we need to figure out how to solve them. I'm not sure that he actually has a solution. But, you know, in some sense, you have to recognize there's a problem to come up with a solution. And, you know, I don't think President Biden really sort of understood that, you know, and now we see it. And, of course, it's a bit nerve-wracking, you know, because part of this, you know, is a challenge to institutions for sure. But then you could say, well, institutions aren't working. So let's figure out how to make them better. You mentioned inclusion just then. And part of your framework is this idea of if political power is broadly distributed or not. What if you get a system where everyone gets a vote, but their political choices are ultimately determined by campaign finance and lobbying and who controls the media and the narrative that's being spinned?

How does your framework apply to, I guess, what people would call democratic capture now. Yeah. I mean, you know, I think, you know, so I've done a lot of research on this question of, you know, the impact of democracy, on kind of public policy and economic growth. and, you know, what we find, I think the evidence is overwhelming that democracy is associated with better public policy, more inclusive public policy, more spending on education, and higher rates of economic growth, you know. But that's not to say, you know, that there's democracy varies enormously, you know. There's lots of different sorts of democracies, and some democracies have worked very imperfectly. They could be corrupt. They could be clientalistic. They could be captured. I, you know, and I, so I think, like, you know, I do tend to think that there are, those are issues, you know, like the, the enormous amount of money, you know, hundreds of millions of dollars that's thrown into these elections, you know, is a problem. You know, for me, like, the biggest problem with inequality is actually the way it spills over into the political system rather than, you know, just in terms of the economy. Do you think oligarch is a good word to describe, you know, a lot of people refer, they talk about Elon Musk, And oligarchs has become like a thing in the discourse.

Is that a useful term for when we look at the influence of money or extremely wealthy individuals who maybe are politically active, etc.? Do you find the sort of oligarch framework to be illuminating? I'm not sure it is, you know, because, you know, the funny thing about Elon Musk is at the end of the day, you know, he's made all of that money through innovation, you know. And I think people admire that. You've got to admire the.

guy, you know, he's just so ambitious and driven, and he's producing stuff that people want. And that's distinct from what we would classically call, like, when we use the word oligarch. Yeah, I think, you know, when people start talking about oligarchs in Russia or oligarchs in, you know, Latin America or whatever it is, they think about people who've made their fortune by, you know, currying favor with the government or through monopolies and things like that. So it has this pejorative connotation that I'm not sure. I don't think it's good for society that Elon Musk can freely pour hundreds of millions of dollars into elections, but I think you have to recognize the way the wealth was made.

Actually, now that we're talking about Elon Musk creating stuff and subsequent wealth, can you talk about, I guess, industrial capacity? So this is a big topic in the U.S. The U.S. wants to build up certain industries, certain strategic industries. We seem to be in competition with China for doing things like semiconductor fabs and that sort of thing. In your framework, how do you sort of clarify, I guess, a government that wants to build capacity in a good faith, economic, maybe, you know, democratic way so that the gains flow to everyone versus an autocratic or oligarchic state where the wealth accrues to a select few? Well, you know, I think there's good arguments for having, you know, various sorts of industrial policies, for instance. And, you know, you see, I mean, there's a lot of economists to say, oh, you know, we can't, you know, the United States can't do that, we can't build up all this industry.

But actually, you know, the fact of the matter is, you know, if you look at a place like South Korea, South Korea created from scratch amazingly competitive industry, like shipbuilding industry. You know, Hyundai hadn't built a rowing boat, you know, in the late 1960s. And then it started, you know, so it went from nothing to create. So, you know, why couldn't the United States do that? Of course it could, actually. So, so, but in order to do it, you need to be immensely serious. You need to plan. You need to have strategy.

I don't see that. How do you ensure that you don't do that in a corrupt way? So, for instance, you know, right now the U.S. government is taking a lot of stakes in different companies. I think it just announced yesterday it was taking 4% in global foundries. And that might be fine. but some people might also worry that maybe the process is corrupt in some way. Maybe we should better understand which companies go up for a government contract bid and that sort of thing. How do you make sure it's fair?

Institutions. Okay. Say more. Just say that it's institutions. But which institutions? Which institutions should we most be worrying about, actually? That's a question I'm asking. Yeah, I think accountability about, you know, that's really about the process.

through which this has done, how contracts are allocated. You know, that process, you know, I think in the Korean example, that, you know, that was not happened. When that started, you know, that was done under this sort of military government. You know, but it was a very different context. You know, it was a geopolitical context where there was this contest with North Korea. You know, it was like very pressing, you know, for the Korean military to do these things. But it was only sustained because that trade.

transition occurred in Korea in the 1980s towards much more democratic accountable governance. Then you see economic growth is even faster. And I think that's – so, you know, I think one thing we point out in why nations fail is all sorts of things can happen in its transitory way. You know, the Soviet Union even did well, you know, transitarily. But you have to sustain it. Then the institutions become really important. Well, let's talk about China, because they – obviously, the economy has grown extraordinarily.

You said, like, you know, generally speaking, democracy is good, but it's not always great and there are ways it could go wrong. Like, how would you describe the institutional preconditions such that China has seen such extraordinary growth over the last few decades? Well, you know, I think if I look at the economics, then, you know, China has flourished because it made this transition from extractive to inclusive institutions. You know, it's not the genius of the Communist Party that did that. But what are the inclusive?

People would say, what? China has inclusive institutions? So, like, what are the inclusive institutions? I think there's two things to separate here. One is the economics and one is the politics. Okay. So the politics is sort of unreformed. You know, we would say that's extractive institutions. So the paradox is, you know, how you have that with inclusive institutions.

I think, you know, the whole history of the Chinese transition from 1978 is the, you know, is the Communist Party kind of detaching itself from the economy to allow entrepreneurs, to allow business to start. And, you know, so how is that combination possible? And, you know, what our theory says is that, you know, there's many instances of that historically. You know, even the Soviet Union, for example, grew very rapidly for 50 years. You know, so we would say, you know, that's a sort of anomalous.

It's a kind of, we call that extractive growth, you know, and it'll go off the rails, you know, and it'll go off the rails. I don't know how it will go off the rails. You're making a call here. Absolutely, yeah. So, you know, and I think the reason, the basic reason for that is obvious, which is power tends to corrupt and absolute power corrupts absolutely, you know. And you don't have to go very far back in Chinese history to see that. For October, from spooky podcasts and chilling playlists to non-stop Halloween radio and more.

We have all the thrills and chills you're craving this season. Press play. The argument you make in the book is. is that if you have maybe more economic inclusion without political inclusiveness, then you get this elite that basically stimmy's creative destruction of industries. So you don't get as much evolution in the economy

as you would otherwise. And for that reason in the book, you say that you think eventually China's growth is going to slow down. I mean, we're here in 2026. It's below 5% in the first half of 2026. But like, you know, 4.6% or whatever is still pretty good. What would make you think that you were wrong

in that creative destruction argument? Yeah, I mean, that's a good question. I mean, I tend to think I'm wrong all the time. I don't admit it in public. No one's listening to this. This is not being recorded. I mean, I think, you know, like obviously, China is culturally very different from Western societies.

I think, you know, an interesting line of thought is to say, you know, maybe there's just something culturally different about China, you know, about the history of the state. You know, there's no history of accountability, you know, in China. You go back two and a half thousand years, you know, you don't have anything like that. You know, there's a very different notion of state and society in China. So, so I think, you know, you could imagine that there's something anomalous culturally about this that keeps it going, you know. But I still think, you know, but I still think, you know, You know, absolute power corrupts absolutely. It's going to go off the rest of the matter.

But you know, it's like, it's interesting though, because, for example, a few years ago, they had the big crackdown on big tech companies. And, like, Jack Ma was, like, put in his place, et cetera. This from the outside, and I'm very, I'm very unreliable here because I consume a lot of Chinese propaganda on, like, Instagram and stuff. So I just think everything's going amazing there, you know. Just China, Max. This looks like a political system that's anti-capture, that's maybe avoiding capture more than a democratic institution, that the business, that you can get very rich in China, but you cannot, it's not easily for the successful businessman to have much political influence.

Yeah, yeah. And, you know, China, China does have these advantages, you know, like, I mean, for example, this obsession with meritocracy in China. You know, I see that, you know, teaching Chinese students. You know, if you ask about, you know, Where are they from? You know, you see this immense sort of social mobility in China. You can get ahead in China. Anyone can get ahead. And, you know, that's very cultural also. You know, that's been for a thousand, two thousand years they've had this examination system getting on for, you know, where, you know, people got to the top and they worked for the, you know, the elite were meritocratically chosen. Now, the British elite, they're just a bunch of, like, demobilized warlords, you know. The creative destruction thing reminds me. I wanted to ask you at least one AI question. Probably more than that. So the creative destruction argument is that if you have elites, incumbents, in power, they're going to block new things because they want to protect their own sources of wealth.

In a place like the U.S., if a local community votes against a new data center, is that democratic empowerment or is that creative? creative destruction and how do you tell the difference between the two? Yeah, I mean, I think that's – sorry, not creative destruction, blocking. Just destruction. Yeah, I think – no way. Economic destruction. I think that's – you know, that's – people are rightfully anxious about the consequences

of AI for their jobs and their incomes and standard of living. You know, for me, the whole – you know, there's an interesting analogy between what's happening I think what's going to happen in the Industrial Revolution. You know, if you look at the Industrial Revolution, the mechanization, the mechanization, say in Britain, for example, the mechanization of, you know, cotton spinning, weaving, you know, what was the impact of that on weaver's wages? They tanked by two-thirds. Their wages fell by two-thirds. You know, what was their reaction? The Luddites, you know, they got hammers and they tried to smash up the machinery, you know. And so isn't that what's happening now? And I think

the analogy to falling wages is probably pretty apt also, you know. If you think about that fact that I was talking about earlier about what's happened to people without a college education, the evidence suggests that the biggest factor explaining that is the diffusion of computers, computers displacing relatively unskilled workers. So, you know, we're still trying to recover from that, and now we're faced with AI. Well, I'm sure, you know, speaking more of AI, you know, in the last several weeks, there's been like this sense of dread and despair that's come over the math community because these breakthroughs and probably math professors at University of

Chicago, some of your colleagues. Would you be surprised if we had something that truly resembled a big Neo-Luddite movement in America or in the modern world? Yeah, I'd be surprised. I mean, I... Aren't we still the same people

you know, like, have we changed? Yeah, I don't know. It's a good question. It's hard to know what it's going to accumulate into. I mean, I, you know, I think there's going to be, you know, science fiction aside, there's going to be big improvements in productivity like there was in the Industrial Revolution. It's how you spread that benefits to society that's going to be sort of critical. I don't know. That's a good question. Yeah.

I read an interesting paper of yours in prepping for this, which is talking about the sort of like, maybe it's like the economist obsession with stamping out market failure. So there are things that economists don't like. They hate rent control. They hate, many of them think that, like, you've got to be really careful about, like, not setting minimum wages too high. Union power, like, maybe some of that, like, isn't optimal. But as you point out, like, these, maybe these are, like, the least worst outcomes. Can you talk a little bit about maybe some of the sort of monomaniacal obsession with economists of getting rid of these and how they can be costly?

Yeah, I think the problem there is economists don't understand the politics of these things. Yeah, see more about that. I mean, you know, there's an economic argument for having trade unions if you have monopsony power. You know, if employers have market power setting wages, trade unions can actually increase employment. But, you know, leaving that aside, I think if you look at, you know, think about Western European societies where trade unions have played important political roles like in Scandinavia, they've been enormously important in creating and sustaining inclusive political institutions. So you can't think about the economics without thinking about the politics. I guess that's a lot of our research.

So like you get rid of the union and maybe you get a brief upticket GDP, but then a couple years later everyone is alienated and then it all falls apart. That's sort of the city. That's part of the mess we're in now. It's not just about the diffusion of computers, but also deunionization. that, you know, the sort of elimination of unions in this country, that's also part of what's created this sort of alienation, it seems to me. We're going to have to insert the monopsony box into this episode.

Sorry, an ongoing joke we have on the podcast. Whenever anyone says monopsony, we're supposed to have a sound effect. I don't know if we actually do it because I never listen to the post-edited versions. We can't listen to our own voices. It's too painful. I said that completely indifference. Just in terms of interesting research, is there anything, working on now using AI that would have been impossible before you could deploy large language models? Absolutely. Tell us what. Give us a preview. So, so one, you know, one project we're

working on is, so one of the things that we're sort of fascinated with at the moment is just trying to understand the role of kind of ideas on in politics. You know, like, I mean, you know, economists and even political scientists tend to focus very much on sort of material interests, but I think ideas like your notion of like how the world should be and what's a legitimate way to organize political authority

and that's very important, you know, we think. So what we're doing is basically using AI to sort of, you know, we've digitized enormous amounts of political works of political philosophy and we're using that look at the impact of philosophical ideas on action in 17th century British politics. They might say 17th century British politics. Why the heck are we doing that? Well, that's the

era of Thomas Hobbes and John Locke and some of these immensely important works of political philosophy. So we're trying to understand how did those arguments affect the way people acted and argued and behaved. So that would have been impossible without AI. I'm really excited about this stuff. I think like the opportunity to sort of like use basically quant, use quantitative approaches on huge bodies of text

and score them on various dimensions is like a very exciting aspect of AI. Yes. No, I agree. I mean, you know, I tend to think, I'm trying to think of AI as something that complements me and makes me more productive and, you know, I hope that's generally true. All right, we have one minute left.

Oh gosh. Why do nations fail? because they create extractive institutions. There's still a minute left. We didn't even need a minute. What should we be watching out for in terms of the U.S.? In terms of? The U.S.

Yeah, what should we be looking out for? Well, I think we should look at how the election goes next month and how properly things are conducted. And also I think we should look at whether people try to undermine the kind of, you know, the sort of, you know, undermine, I don't know what the right word is, the veracity of the election. I think what we've seen in this country in the last few years is enormous attempts to undermine, you know, elections. You know, there's very little evidence, for example, in this country that elections are improperly done or they're fiddled or they're fake

or they're whatever. So I think this language attempting to convince people of that is very damaging to the institutions. Professor Robinson, thank you so much for coming to Odd Lots Live. It's fantastic. Episode of the Oddlots podcast recorded live in Chicago. I'm Tracy Alloway. You can follow me at Tracy Alloway. And I'm Joe Wisenthall. You can follow me at the stalwart. Follow our producers, Carmen Rodriguez, at Carmen Armin, Dashall Bennett at Dashbot. Kale Brooks and Keel Brooks and Kevin Lazzano at Kevin Lloyd-Lazano. For more Oddloves content, go to Bloomberg.com slash Oddlot for the daily newsletter in all of our episodes. And you can chat about all these topics 24-7 in our Discord, discord.g. And if you enjoyed this conversation, then please leave us a positive review on your favorite podcast platform.

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