Economics 172 Issues in African Economic Development

1. Economics 172Issues in African Economic Development Lecture 17 March 16, 2006

2. Outline: • Impacts of slavery on African economic development (Nunn 2005) • Historical population density and political power in Africa (Herbst 2000) Economics 172

3. Long-run impacts of slavery in Africa • Nunn (2005) compiled a new dataset on the country of origin of individuals sent to the New World in the Atlantic Ocean and Indian Ocean slave trades, using shipping records, slave ethnicity data • He assigns people shipped from a particular port as originally coming from that country or its neighbors (e.g., people shipped from ports today in Ghana are assigned to either Ghana or Burkina Faso) Economics 172

4. Map of Africa Economics 172

5. Long-run impacts of slavery in Africa • Nunn (2005) compiled a new dataset on the country of origin of individuals sent to the New World in the Atlantic Ocean and Indian Ocean slave trades, using shipping records, slave ethnicity data • He assigns people shipped from a particular port as originally coming from that country or its neighbors (e.g., people shipped from ports today in Ghana are assigned to either Ghana or Burkina Faso) • Although an improvement, there are many ways this could generate imperfect data Economics 172

6. Numbers of slaves taken, by country • Nunn constructs a measure of slavery exposure Economics 172

7. Long-run impacts • The main regression equation is: • The Y variables here include long-run income levels (per capita), economic growth rates, political outcomes. Nunn finds consistently negative impacts of slavery exposure on later economic outcomes Economics 172

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10. Long-run impacts • The magnitude of these negative effects is quite large: a 1 s.d. increase in slave exports increases annual per capita economic growth during 1960-2000 by 1.25% • There are also adverse impacts on many other political and institutional outcomes (Table 12). How to interpret the true channels leading to poor economic outcomes? Economics 172

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13. Interpretation of Nunn’s results • Countries most exposed to European slave trading today look much worse off than other African countries. Several of Africa’s success stories (e.g., Botswana) were untouched by the trade Economics 172

14. Interpretation of Nunn’s results • Countries most exposed to European slave trading today look much worse off than other African countries. Several of Africa’s success stories (e.g., Botswana) were untouched by the trade • But it is unclear exactly what the cause of this is. There are many theoretically plausible mechanisms through which slavery could affect current outcomes Economics 172

15. Interpretation of Nunn’s results • Countries most exposed to European slave trading today look much worse off than other African countries. Several of Africa’s success stories (e.g., Botswana) were untouched by the trade • But it is unclear exactly what the cause of this is. There are many theoretically plausible mechanisms through which slavery could affect current outcomes • Omitted variables: were the areas with the weakest political institutions historically most preyed upon? Economics 172

16. Outline: • Impacts of slavery on African economic development (Nunn 2005) • Historical population density and political power in Africa (Herbst 2000) Economics 172

17. Population density and politics in Africa • The basic idea: historically, land was abundant in Africa and population was low. The scarce resource was labor not land Economics 172

18. Population density and politics in Africa • The basic idea: historically, land was abundant in Africa and population was low. The scarce resource was labor not land • Wars in Sub-Saharan Africa traditionally were over control of labor (the valuable scarce resource) rather than the control of land • The result is that warfare and politics look very different historically in Africa than in Europe or Asia, with their much higher population densities Economics 172

19. Table 1.1, 1990 population densities RegionDensity in 1900 (people/km2) Japan 118.2 Europe 62.9 China 45.6 South Asia 38.2 Sub-Saharan Africa 4.4 Latin America 3.7 Economics 172

20. Table 1.1, 1990 population densities RegionDensity in 1900 (people/km2) Japan 118.2 Europe 62.9 China 45.6 South Asia 38.2 Sub-Saharan Africa 4.4 Latin America 3.7 • Why was population density so low in Africa? Economics 172

21. Table 1.1, 1990 population densities RegionDensity in 1900 (people/km2) Japan 118.2 Europe 62.9 China 45.6 South Asia 38.2 Sub-Saharan Africa 4.4 Latin America 3.7 • Why was population density so low in Africa? (i) Tropical disease; (ii) Low agricultural productivity; (iii) The slave trade Economics 172

22. Population density and politics in Africa • Low population density made it difficult to radiate political power over space • Exception: the highlands of East Africa (e.g., Rwanda) Economics 172

23. Population density and politics in Africa • Low population density made it difficult to radiate political power over space • Exception: the highlands of East Africa (e.g., Rwanda) • This picture begins to change in the 18th and 19th century, with the importation of millions of guns as part of the Slave Trade • Larger states emerge during this period – Sokoto Emirate in Nigeria, Zulu Empire in Southern Africa, Buganda in Uganda, Ashanti in Ghana. Other important pre-colonial states include Swahili-Omani Kingdom, Ethiopia, Liberia Economics 172

24. The rise of European colonialism • This process of political consolidation was short-circuited by European conquest in the late 1800s • Why did Europeans decide to conquer Africa, after being content for hundreds of years with trade? Economics 172

25. The rise of European colonialism • This process of political consolidation was short-circuited by European conquest in the late 1800s • Why did Europeans decide to conquer Africa, after being content for hundreds of years with trade? (1) The invention of quinine greatly reduced the threat of malaria for Europeans (2) The invention of the machine gun (the Maxim gun) greatly increased their relative military might Economics 172

26. Whiteboard #1 Economics 172

27. Whiteboard #2 Economics 172

28. Whiteboard #3 Economics 172

29. Whiteboard #4 Economics 172

30. Whiteboard #5 Economics 172

31. Map of Africa Economics 172