Occasional Papers
Institutions of innovation and Poverty
Western nations benefit from social institutions that create prosperity and liberty. The separation of the economic and political spheres and the emergence of institutions of private property and markets were crucial developments in
Western history. The sources of these institutions are often ill-understood. They were not the product of planning by a single individual or organisation, but evolved over time. They were the product of human action, but not of human design. In turn, these institutions facilitate innovation by allowing for change as needed. Central planners are unable to adjhust for change in the way of markets, and this is a key reason for the failure of socialist economies Professor Ball argues that our future prosperity depends on avoiding the temptation to believe that we can bring greater prosperity by interfering with the processes of institutional innovation.
