Thelegalled by Nigel idea that “institutions matter” is a relatively recent amendment to the standard corpus of economic thinking. Only in the past two decades has it become a mantra of development economists.

The trigger was the recognition that plans to promote growth after decolonisation had failed. The continued poverty of many countries could not be fully explained by a shortage of capital or the legacy of foreign exploitation. Economic historians emphasised that the industrial revolution was the product not just of technological change and related investment in plant and machinery; it had also required the contemporaneous evolution of political and economic institutions.

A visit to Hong Kong is a reminder of how much institutions matter.