As a fan and reader of "Why Nations Fail", I have a question for Daron and Jim. I know that "inclusive institutions" are good. Given this point, where do the authors stand on California's direct democracy and its initiative process? Do the Cambridge guys believe in "people power"?
Here is the current California voting slate of initiatives for 2012. If "we" (the voters of California) have the chance to vote to kill off High Speed Rail and to kill off the University of California, does such participatory democracy foster my favorite state's long run growth? My old friend John Matsusaka is a fan of such initiatives as he has argued that they act as a check on growth of the public sector (see his QJE paper). and his JPE paper.