What does path dependency imply about a country's trajectory?

• A. History matters; a small thing that a country does will set it on a certain path
• B. The future determines the present path exclusively
• C. Past events have no influence on future policy
• D. Random events determine outcomes

Answer: (A)

Path dependence shows that a country’s future is shaped and constrained by its past. Early decisions create institutions, norms, and investment patterns that become self-reinforcing, making a particular path more stable and harder to change over time. Because of these reinforcing effects and the costs of switching, a small action taken early can set a country on a specific trajectory, with consequences that endure even if better options later arise.

This isn’t saying the future rules everything, or that past events have no influence, or that outcomes are entirely random. It’s about how history creates lock-in and paths that guide what’s more likely to happen next.