This paper ties into a new literature that aims to quantify the long-term economic effects of historical European settlement, arguing for the need to properly address the role of indigenous agency in path-dependent settlement processes. We conduct three comparative case studies in West, East and Southern Africa, showing that the successes of European settler farming were often of a temporary nature and that they critically depended on colonial government policies arranging access to local land and labour resources. Further, we argue that these policies were shaped by the clashing interests of African smallholders and European planters, in which colonial governments did not necessarily abide to settler demands, as is often assumed.
The educational legacy of Dutch colonial rule in the Netherlands Indies has been widely regarded as disappointing. This paper probes further into the underlying causes of the poor Dutch legacy. It is argued that the spread of popular education was not only hampered by a lack of financial commitment by the colonial state, but also by notable inequalities in the allocation of funds for education and a major reluctance to support initiatives in investment in private education, which may be interpreted as a consequence of the Dutch metropolitan commitment to secular rule in an overwhelmingly Islamic society.
Inequality studies tend to assume a positive correlation between income and wealth inequality. We doubt whether this holds for Rhineland welfare states as they seem to combine low income inequality with high wealth inequality levels. We hypothesize that publicly funded life-time income security, which is so typical for Rhineland welfare states, enhances private debt creation, while the redistributive taxes required to finance this system are targeting income rather than wealth.
Given difficult to access pre-colonial forms of surplus extraction, African colonial governments faced severe constraints to raise revenue for incipient colonial state formation. This paper compares the ways in which the British and the French dealt with this challenge in a quantitative framework. We exploit colonial government budget accounts to construct PPP-adjusted comparisons of per capita government revenue by source. A comparison of fiscal capacity building shows that pragmatic responses to varying local economic, political and demographic conditions can easily be mistaken for specific metropolitan blueprints of colonial governance and that under comparable local circumstances the French and British operated in remarkably similar ways.
This paper aims to make an empirical and theoretical contribution towards the creation of a continent wide data set on African population extending into the pre-1950 era. We investigate the reliability and the validity of the current population databases with the aim of working towards a consensus on the long term series of African total population with a reliable 1950 benchmark. The cases of Kenya, Nigeria and Ghana are explored to show how uneven coverage census taking has been in colonial and post-colonial Africa and to demonstrate the need for an upward adjustment of the conventional 1950 benchmark. In addition, we discuss the advantages and disadvantages of Patrick Manning’s approach of projecting population growth estimates backwards in time by adopting the available Indian census data as African ‘default growth rates’ and propose an alternative approach by incorporating the demographic experiences of tropical land abundant countries in South East Asia.
The field of African economic history is in resurgence. This paper reviews recent and on-going research contributions and notes strengths in their wide methodological, conceptual and topical variety. In these strengths there is also a challenge: different methodological approaches may also result in divisions, particularly on the quantitative versus qualitative axis. The African Economic History Network has recently been formed to bridge the gap between methods and sources and to facilitate intellectual exchanges among the widest possible range of scholars working on Sub-Saharan economic history. This paper outlines current research projects and calls for future research as well as suggesting promising lines of enquiry in the discipline.
The 2010 earthquake in Haiti has exposed the extreme vulnerability of a people living in a country where the state and the economy simultaneously fail to deliver. Haiti’s neighbor, the Dominican Republic, has witnessed several phases of strong economic growth since the 1870s and an encouraging transition towards democratic rule in the late 20th century. How could this Caribbean island drift apart so profoundly? Capitalizing on decades of seminal scholarship in the neo-institutional tradition North, Wallis and Weingast (2009) have developed a new conceptual framework to explain different performance characteristics of societies through time. In this study we put the latest vintage of institutional theory to the test by taking it to the case of Hispaniola. We conclude that it captures the differing internal logic of the political economy in both countries quite well, but that it is of little use to understand the effect of external (international) relations on long term development.
Recent studies on African economic history have emphasized the structural impediments to African growth, such as adverse geographical conditions and extractive colonial institutions. The evidence is mainly drawn from cross-country regressions on late 20th century income levels, assuming persistent effects of historical causes over time. But to which extent has African poverty been a persistent phenomenon? Our study sheds light on this question by providing new evidence on long-term African growth-trajectories. We show that slave trade regressions are not robust for pre-1970s GDP per capita levels, or for pre-1973 and post-1995 growth rates. We calculate urban unskilled real wages of African workers in nine British African countries 1880-1965, adopting Allen’s (2009) subsistence basket methodology. We find that real wages were above subsistence level, rose significantly over time and were, in major parts of British Africa, considerably higher than real wages in Asian cities up to, at least the 1930s. We explain the intra-African variation in real wage levels by varying colonial institutions concerning land alienation, taxation and immigration.
British colonial rule has often been praised for its comparatively benign features, such as its support for local educational development. This paper studies the origins of formal education in sub-Saharan Africa arguing that the beneficial effects of British educational policy should not be overstated. British African colonies showed significantly higher school enrolment rates in the late colonial era, but these were not the result of impressive investment efforts. Missionary schools provided the bulk of education to native Africans at extremely low costs. We show that local African conditions affecting the African reception of missionary education explain much more of the variation in colonial educational outcomes than metropolitan identity.
This paper offers time-series of urban unskilled labor wages and commodity prices in eight British African colonies (1880-1940) and shows that real wages were above subsistence level and rising, especially during the interwar years. Real wages in West Africa and Mauritius were even considerably higher than in some major Asian cities. Our results cast doubt on studies emphasizing the existence of ‘structural impediments’ to African economic growth. We also document an East-West divergence within Africa and argue this was caused by variations in colonial land and labor market institutions, challenging the view that African colonial institutions were exclusively extractive.
This paper presents a new benchmark of fisher weighted sector PPPs for agriculture, mining and five manufacturing branches in the US, UK, France and the Netherlands around 1910. The PPPs are constructed according to an industry-of-origin approach in order to assess comparative levels of labour productivity at a sector level. The estimates are subsequently used to build up a comparison of total labour productivity and GDP per capita. Our main findings are that the relative levels of labour productivity and per capita GDP in the Western European countries have been overestimated in the literature so far. A backward projection of our productivity estimates into the nineteenth century sheds new light on the timing of the take-over in productivity and income leadership between the Netherlands, UK and US. The US-UK take-over occurred between 1879 and 1899 in terms of GDP per capita, but we show that in terms of aggregate labour productivity the US was already world leader around 1850. The Dutch economy seems to have lost its economic leadership earlier than hitherto has been assumed.
For over three decades (1966-1998) socio-economic policies in Indonesia were founded on Soeharto’s development trilogy “growth, stability and equity”. Literature agrees that the policy goals of growth and stability were met by and large, but remains inconclusive about equity. In this paper we estimate Theil indices of sector income distribution to evaluate the impact of structural change on the trend of Indonesian income inequality for the period 1961-2002. Where conventional Gini-coefficients based on household expenditure surveys suggest that Indonesian income equality is comparatively confined and reveals no long run tendency in either upward or downward direction, our results indicate that inter and intra-sector income inequality increased rapidly under Soeharto, as well as the share of the labour force engaged in informal sector activities.
The colonial heritage of high land inequality in Latin American countries is still, after nearly two centuries of independence, one of the crucial underpinnings of its persistent high levels of income inequality. This paper assesses the colonial strategy of land redistribution in a global comparative perspective using new and existing land inequality figures in an OLS regression framework. The two central questions addressed are 1) what explains the cross-country variation in land inequality at the end of the colonial age? 2) how does initial land inequality relate to current income inequality? The main conclusions of the paper are that geography and factor endowments play a less decisive role than often argued in literature. And second, controlling for regional fixed effects, initial land inequality explains a substantial part of the present cross-country variation in current income inequality.
Cross-country research on educational inequality presents contrasting views on the extent of educational inequality in Latin America and Sub-Saharan Africa. The differences in opinion also concern the relation between educational inequality and income inequality. This paper argues that part of the reported results are influenced by the type of inequality indicator applied. Moreover, there may be a separate effect of educational attainment and educational distribution on income inequality, which cannot be discerned properly by conventional indicators (in particular the Gini-coefficient faces this problem). A new indicator of educational distribution, which we coined the grade enrolment ratio, focuses at the distribution of students among consecutive grades in schooling, apart from average years of schooling (attainment). We find that the grade enrolment ratio outperforms the other indicators in explaining cross-country variation in income inequality and accurately assesses Latin American and Sub-Saharan African educational inequality.
This study argues that the creation of productive jobs is the key to economic growth, social development and improvements in living standards. The study provides extensive empirical evidence showing that the long run trend has been towards simultaneous growth in per capita income, productivity and employment growth. However, depending on the type of indicator and the time frame adopted, there are legitimate concerns about the distribution of the productivity and welfare gains from growth both within as well as between countries. Following the analysis of the long term growth pattern (Chapter 2), the study investigates under which conditions, in which regions and which industries a trade-off occurs between productivity and employment growth. In Chapter 3 patterns of employment-productivity trade-offs are established across regions and time periods at the macro level. Chapter 4 focuses on sectors of the economy. In Chapter 5 the study discusses the policy areas that will be most conducive to breaking or reducing the trade-off between productivity growth and employment in order to exploit the long run growth potential. We argue that, in addition to sound macroeconomic policies, a sensible role for market forces in allocating resources to their most productive uses is important. However, the key challenge is to create an institutional environment that can alleviate some of the negative effects in the short and medium run while not hampering the realisation of the long run growth potential. Support to the creation of social capabilities and national innovation systems are important policy areas to achieve this goal. While strengthening an economy’s fundamentals in the short and medium run, these also contribute to the virtuous circle of productivity growth, employment creation and poverty alleviation, which is the main theme of the ILO World Employment Report 2004.