The state and its institutions are crucial for economic development: for better and for worse. This insight informs this important, up-to-date and authoritative survey of new trends in growth economics and the widely divergent economic performance of developing countries – for example, between Latin America and South-east Asia – which seemed to be similarly placed just a generation ago. The decisive role of the political dimension in economic growth seems clear but there are many challenges to be met in getting an analytical handle on the precise determinants and in testing empirically for this. This is the challenge taken up by the international team of contributors.