Why nations fall

http://whynationsfail.com/
The book presents the theory that economic and political institutions drive the success or failure of nations.

First by using compartive analysis of regions with similar culture, geography, climate or resources the author makes a good cases that these differences don't explain success or failure as some have assumed (see Guns, Germs and Steel). While the outcome of civilization clashes is influenced by the technology, the root causes that make some contries use and expand technology, lies in the institutions those civilizations adopt.

The rest of the book gives a large number of examples of the political and economical organization of the region having a major effect on the outcomes people get and the incentives each part of society has. We readily see two fundementally different systems.
For the politics there are exclusive institutions designed to concentrate power in the leader and his circle of friends (tyrannies and monarchies), or inclusive institutions which distribute power widely (democracies and republics).
For the economics there are extractive institutions which exploit the work of many for the benefits of few or inclusive institutions where everyone has a right to the fruits of his labor.
This dichotomy is seen as the basis for success or failure.
While the thesis of the book is interesting it does seem to simplify the world a bit too much.
The simplicity of the theory has also the advantage that it can be readily tested by watching the success or failure of nations while assessing there inclusive vs. exclusive institutions. This is something interesting to think about while watching international politics.

Bill Gates has written a review of this book at:
http://www.thegatesnotes.com/Books/Personal/Why-Nations-Fail