Re: Bandit theory
The essential elements that caused these countries to become rich are rule of law and enforcement of contract. Without those investment is too risky to bother with, it's better just to farm the masses for small bits of wealth while they remain dirt poor in those circumstances.
Rule of law has to be enforced against the rulers as well as the masses. Hence the reforms of the Glorious Revolution, more so than Magna Carta, kicking off the beginnings of British dominance in the world in wealth and power. Other countries which still allowed their rulers and elites to welch on deals if they felt like it couldn't muster the investment Britain could.
Rule of law and enforcement of contract generally require a reasonably powerful state to enforce them. Wasteful shit will build around it once wealth starts to grow as noted but that doesn't mean all state-spending is such.