<P> American economists William Easterly and Ross Levine argue that economic development does not solely depend on geographic endowments--like temperate climates, disease - resistant climates, or soil favorable to cash crops . They stress that there is no evidence that geographic endowments influence country incomes other than through institutions . They observe that states like Burundi are poor--despite favorable environmental conditions like abundant rainfall and fertile soil--because of the damage wrought by colonialism . Other states like Canada with fewer endowments are more stable and have higher per capita incomes . </P> <P> Easterly and Levine further observe that studies of how the environment directly influences land and labor were tarred by racist theories of underdevelopment, but that does not mean that such theories can be automatically discredited . They argue that Diamond correctly stresses the importance of germs and crops in the very long - run of societal technological development . They find that regression results support the findings of Jared Diamond and David Landes that factor endowments influence GDP per capita . However, Easterly and Levine's findings most support the view that long - lasting institutions most shape economic development outcomes . Relevant institutions include private property rights and the rule of law . </P> <P> Jeffrey B. Nugent and James A. Robinson similarly challenge scholars like Barrington Moore who hold that certain factor endowments and agricultural preconditions necessarily lead to particular political and economic organizations . Nugent and Robinson show that coffee economies in South America pursued radically different paths of political and economic development during the nineteenth century . </P> <P> Some coffee states, like Costa Rica and Colombia, passed laws like the Homestead Act of 1862 . They favored smallholders, held elections, maintained small militaries, and fought fewer wars . Smallholder arrangements prompted widespread government investment in education . Other states like El Salvador and Guatemala produced coffee on plantations, where individuals were more disenfranchised . Whether a state became a smallholder or plantation state depended not on factor endowments but on norms established under colonialism--namely, legal statues determining access to land, the background of the governing elites, and the degree of permitted political competition . Nugent and Robinson thereby conclude that factor endowments alone do not determine economic or political institutions . </P>

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