would have jeopardized their political power. Indeed, when Mikhail Gorbachev started to move away from extractive economic institutions after 1987, the power of the Communist Party crumbled, and with it, the Soviet Union.
THE SOVIET UNION was able to generate rapid growth even under extractive institutions because the Bolsheviks built a powerful centralized state and used it to allocate resources toward industry. But as in all instances of growth under extractive institutions, this experience did not feature technological change and was not sustained. Growth first slowed down and then totally collapsed. Though ephemeral, this type of growth still illustrates how extractive institutions can stimulate economic activity. Throughout history most societies have been ruled by extractive institutions, and those that have managed to impose some extent of order over the countries have been able to generate some limited growth— even if none of these extractive societies have managed to achieve sustained growth. In fact, some of the major turning points in history are characterized by institutional innovations that cemented extractive institutions and increased the authority of one group to impose law and order and benefit from extraction. In the rest of this chapter, we will first discuss the nature of institutional innovations that establish some degree of state centralization and enable growth under extractive institutions. We shall then show how these ideas help us understand the Neolithic Revolution, the momentous transition to agriculture, which underpins many aspects of our current civilization. We will conclude by illustrating, with the example of the Maya city-states, how growth under extractive institutions is limited not only because of lack of technological progress but also because it will encourage infighting from rival groups wishing to take control of the state and the extraction it generates.
ON THE BANKS OF THE KASAI
One of the great tributaries of the River Congo is the Kasai. Rising in Angola, it heads north and merges with the Congo