By Robert E . Wright

America became prosperous and populous as a direct result of four key “ growth diamond ” institutions : a limited government that begat a modern financial sector , an open access system of entrepreneurship and social innovation , and effective management of large organizations , both for- and non-profit . Although time and culture specific in their details , in their broad outlines the four institutions of “ the growth diamond ” have proven themselves both necessary and sufficient causes of economic growth , defined as sustained increases in inflation-adjusted per capita output . Every nation in the world today that enjoys a high level of per capita income ( save for the transient riches of a few oil producers ) has a growth diamond , and no nation with growth diamond institutions is impoverished . No other path to

“ Scene at the Signing of the Constitution of the United States ,” oil on canvas painting by Howard Chandler Christy .

“ Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism , but peace , easy taxes and a tolerable administration of justice ; all the rest being brought by the natural course of things . All governments which thwart this natural course , which force things into another channel or which endeavour to arrest the progress of society at a particular point , are unnatural , and to support themselves are obliged to be oppressive and tyrannical .”

high per capita income , a prerequisite to human flourishing , appears to exist .

Improving health and / or education has been tried repeatedly in different contexts but has always failed to spark sustained growth . Granting money , even entire , fully operational factories , has only proven an effective way of keeping recipient peoples impoverished . Only governments that consistently protect human rights , and foremost the rights to life , liberty and

— Adam Smith

property , stimulate growth and development . Governments may attempt to do more . They may impose import substitution policies , for example . But their extra efforts are uncorrelated with long-run growth . They may even hurt their nations ’ economic prospects .

Perhaps the clearest and most concise view of limited government ever published was the 1850 pamphlet , “ The Law ,” written by French political economist Frederic

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