Why Nations Fail: The Origins of Power, Prosperity, and Poverty

institutions, such as the lack of serfdom.
    Eastern Europe was a different matter. The kingdom of Poland-Lithuania, for example, was ruled by an elite class called the Szlachta, who were so powerful they had even introduced elections for kings. This was not absolute rule as in France under Louis XIV, the Sun King, but absolutism of an elite, extractive political institutions all the same. The Szlachta ruled over a mostly rural society dominated by serfs, who had no freedom of movement or economic opportunities. Farther east, the Russian emperor Peter the Great was also consolidating an absolutism far more intense and extractive than even Louis XIV could manage. Map 8 provides one simple way of seeing the extent of the divergence between Western and Eastern Europe at the beginning of the nineteenth century. It plots whether or not a country still had serfdom in 1800. Countries that appear dark did;those that are light did not. Eastern Europe is dark; Western Europe is light.
    Yet the institutions of Western Europe had not always been so different from those in the East. They began, as we saw earlier, to diverge in the fourteenth century when the Black Death hit in 1346. There were small differences between political and economic institutions in Western and Eastern Europe. England and Hungary were even ruled by members of the same family, the Angevins. The more important institutional differences that emerged after the Black Death then created the background upon which the more significant divergence between the East and the West would play out during the seventeenth, eighteenth, and nineteenth centuries.
    But where do the small institutional differences that start this process of divergence arise in the first place? Why did Eastern Europe have different political and economic institutions than the West in the fourteenth century? Why was the balance of power between Crown and Parliament different in England than in France and Spain? As we will see in the next chapter, even societies that are far less complex than our modern society create political and economic institutions that have powerful effects on the lives of their members. This is true even for hunter-gatherers, as we know from surviving societies such as the San people of modern Botswana, who do not farm or even live in permanent settlements.
    No two societies create the same institutions; they will have distinct customs, different systems of property rights, and different ways of dividing a killed animal or loot stolen from another group. Some will recognize the authority of elders, others will not; some will achieve some degree of political centralization early on, but not others. Societies are constantly subject to economic and political conflict that is resolved in different ways because of specific historical differences, the role of individuals, or just random factors.
    These differences are often small to start with, but they cumulate, creating a process of institutional drift. Just as two isolated populations of organisms will drift apart slowly in a process of genetic drift, because random genetic mutations cumulate, two otherwise similar societies will also slowly drift apart institutionally. Though, just like genetic drift, institutional drift has no predetermined path and does not even need to be cumulative; over centuries it can lead to perceptible, sometimes important differences. The differences created by institutional drift become especially consequential, because they influence how society reacts to changes in economic or political circumstances during critical junctures.

    The richly divergent patterns of economic development around the world hinge on the interplay of critical junctures and institutional drift. Existing political and economic institutions—sometimes shaped by a long process of institutional drift and sometimes resulting fromdivergent responses to prior critical junctures—create the anvil upon which future change will be forged. The Black Death and the expansion of world trade after 1600 were both major critical junctures for European powers and interacted with different initial institutions to create a major divergence. Because in 1346 in Western Europe peasants had more power and autonomy than they did in Eastern Europe, the Black Death led to the dissolution of feudalism in the West and the Second Serfdom in the East. Because Eastern and Western Europe had started to diverge in the fourteenth century, the new economic