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Why do powerful elites resist economic and political change?

A central part of this research has also been on identifying where the resistance lays, both institutional and technological. At the heart of Acemoglu’s theory lies a blunt truth. Those in power often resist change, even when it would enrich them.

This resistance, whether economic, political, and or social, is not incidental. It is systemic. Monopolists fear competition. Dictators fear empowerment. A new technology may promise growth, but if it threatens to democratize information, shift labor dynamics, or embolden opposition, it becomes dangerous to those who rule. What this insight shows is that development does not fail for a lack of ideas, tools, or even resources. It fails when elites calculate that repression is safer than reform. This resistance plays out in moments of profound transformation. Wars, plagues, revolutions, and new technologies destabilize entrenched orders. Acemoglu calls these “critical junctures”, turning points when institutional paths diverge.

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What are critical junctures and how do they change the course of development?

“Critical junctures destabilize existing orders and create a mismatch between existing institutions and people's aspirations,” he says. “When that happens, there is a fork in the road, so to speak. Either you're going to allow some of these changes to take place or you have to take a very robust action against them. So critical junctures are big amplifiers of inequality, and they are the handmaidens of institutional changes.” Industrialization was one such juncture, as was colonialism, according to Acemoglu.

“Once you fall behind, it becomes very difficult to build better institutions,” he says.

Critical junctures are big amplifiers of inequality, and they are the handmaidens of institutional changes.

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What is the narrow corridor theory of democracy and state power?

In their second book together, “The Narrow Corridor”, Acemoglu and Robinson furthered their research by arguing that freedom arises not from the absence of state power but from its balance with an empowered society. Too little state, and chaos reigns. Too much, and tyranny takes hold. The narrow corridor concept created by the pair is trying to capture that tension.

“Democracy and freedom are natural bedfellows, but they're not the same thing,” says Acemoglu. “Democracy is a very complex notion. On the one hand, we want people to be free of the worst kind of coercion and abuse. But on the other hand, freedom also has an enabling element in it.”

That enabling element requires robust institutions that provide things like education, healthcare, infrastructure, and protection from violence. But the institutions must also have constraints, or they risk becoming predatory. “You want the ability of any institution, third party, elite or boss to be limited,” he says. “You want the state but to have that state very constrained so that it cannot do what states have done throughout humanity.” Maintaining that balance of the narrow corridor requires constant recalibration, particularly in the face of crises like climate change or digital authoritarianism.

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Why are modern democracies becoming more fragile?

Democracy and freedom are natural bedfellows, but they're not the same thing.

People use power for many things once it is delegated, and democracy itself can also be unstable. Acemoglu sees this happening in many places around the world right now and thinks it may be the critical juncture of our times. “Both liberal democracy and freedom are in danger because of economic and cultural tensions,” he says, but he warns that three specific things are particularly dangerous when concentrated. “One is wealth. The other one is power. And the third is information. And right now, we are concentrating all three of them more and more in the hands of a small group of people.”

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How does Daron Acemoglu view the risks and benefits of technology?

From the British weavers destroyed by mechanization to today’s gig workers displaced by AI, Acemoglu says the benefits of any new technology depends on its design and on the institutions that shape its use. Acemoglu and Johnson challenged the assumption that technological progress is automatically good for everyone in their book “Power and Progress” because, historically, it hasn’t been. They distinguish between automation, which often reduces opportunity, and task creation, which augments human capability. The key, according to Acemoglu, is choosing technologies that empower workers, and doesn’t just replace them.

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What are Acemoglu’s concerns about AI and digital power?

AI is often hailed as a holy grail technology today and Acemoglu doesn’t necessarily disagree, but he cautions against techno-optimism. “I think all digital technologies, including AI, pose two sets of distinct threats,” says Acemoglu. “One is if they create joblessness and inequality, they will deepen social tensions and make democracy harder to work. Second, these are information technologies, and whoever controls information technology controls information.”

Redirecting technological change towards creating new tasks, rather than eliminating automation, is one way to ensure we are building systems that promote shared prosperity, according to Acemoglu. “AI comes with a lot of possibilities for improving human expertise, boosting human capabilities, creating new tasks, and new services for humans,” he says.

Institutions should be updated as technology advances, but so should the questions we ask ourselves around the direction of technology and the power that institutions have on those shepherding it. “Institutional elements and the direction of technology are both critical, and this is why new technologies require new debates,” he says. “It’s a very difficult balance. And if in doubt, I think, we have to err on the side of letting the market work, because we have many examples of historical societies that have tried to control technology and as a result, they’ve become barriers against technological developments and led to mass scale underdevelopment.”

Whoever controls information technology controls information.

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How does Daron Acemoglu stay hopeful about the future?

Despite the challenges, Acemoglu is not particularly worried. He draws hope from history, especially the ability of societies to self-correct. The reform of industrial Britain. Latin American democracies that have emerged from dictatorship. Even amid today’s turbulence, he sees the possibility for new ideas, new institutions, and new coalitions.

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How can education, participation, and new ideas drive positive change?

“Informed and active citizenry are more important than ever,” he says. “Citizens have to be worried about technology, power, information, jobs. All of this requires flexibility. We need to be adaptable as individuals, as societies.” To achieve this, education matters. Participation matters. But above all, ideas matter. New technologies demand new narratives, new frameworks for thinking about inclusion, productivity, and power. “We need new ideas to beat bad ideas,” he says. The future, in other words, is not just something to be inherited in Acemoglu’s mind, it must be constructed and contested.

We should never lose hope, especially hope in the creativity, adaptability, and the versatility of humans.

When asked if he’s optimistic, Acemoglu draws a sharp distinction. “There’s a thin line between optimism and hope,” he says. “Optimism makes us blind. But we should never lose hope, especially hope in the creativity, adaptability, and the versatility of humans.”

It’s not a sentimental hope he holds, but a deeply empirical one. He points to the achievements humans have made over the last few hundred years. “We have built societies consisting of hundreds of millions of people that have, for the most part, lived peacefully and in ways that creates new pathways for people to achieve their dreams to build prosperous, healthy, comfortable and free lives,” he says. “That's just an amazing achievement.”

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What is Daron Acemoglu’s message to the next generation of thinkers and leaders?

Acemoglu teaches his students, his children, and his peers with the weight of history in mind and the urgency of the present. His advice to the next generation is both simple and demanding: remain vigilant, curious, and engaged. Acemoglu himself finds inspiration in unexpected places like a line in a newspaper, sometimes in a song or movie, or in an old historical document.

“We’re living through unusual times so there isn’t a natural roadmap,” he says. “You have to have an open mind both about the dangers and the opportunities.” That openness to argument, to evidence, and to transformation is perhaps his most enduring commitment.