Despotic growth runs out for two reasons: when the state can seize anything people stop building, which in time shrinks even its own revenue; and innovation needs liberty to experiment, which extractive rule suppresses, so despotic growth is catch-up growth that stalls (the Soviet Union by the 1970s).

groundsWhy Nations Fail

By their very nature, extractive institutions do not foster creative destruction and generate at best only a limited amount of technological progress

groundsThe Narrow Corridor

Innovation needs creativity and creativity needs liberty

groundsThe Narrow Corridor

not only citizens' livelihoods but even the state's tax revenues start to suffer.