Development Economics War?

Chris Blattman asks Did Acemoglu and Robinson just declare war on development economists? (via Mark Thoma).  Considering my development professor was an institutionalist, I don't have the background as to how institutions don't matter (at all), or what sorts of articles completely ignore institutions.  I think it's foolish to think that ONLY institutions matter, so writing an development article with which institutions aren't the main catalyst isn't necessarily ignoring the importance of institutions.  However, until we start looking at HOW institutions matter, what really lies behind the political economics of it, I don't see what's so interesting in institution-based development economics.