African Economic Development and Colonial Legacies
This article reviews how colonial rule and African actions during the colonial period affected the resources and institutional settings for subsequent economic development south of the Sahara. The issue is seen from the perspective of the dynamics of development in what was in 1900 an overwhelmingly land abundant region characterised by shortages of labour and capital, by perhaps surprisingly extensive indigenous market activities and by varying but often low levels of political centralisation. The differential impact of French and British rule is explored, but it is argued that a bigger determinant of the differential evolution of poverty, welfare and structural change was the contrast between "settler" and "peasant" economies.
1 The current names of former colonies are preferred in this essay, not least because until the 1930s (.)
1This article asks how the legacies of European rule, both generally and in particular categories of colony, have affected post colonial economic development in Sub Saharan Africa. The year 1960 is conventionally used as the "stylised date" of independence, for the good reason that it saw the end of colonial rule in most of the French colonies south of the Sahara as well as in the most populous British and Belgian ones (Nigeria and Congo respectively).1 Half a century is a reasonable period over which to review the economic impact of legacies because it allows us to consider the issue in the context of different phases of post colonial policy and performance.
2The causal significance of legacies varies, in that they affect subsequent freedom of manoeuvre to different extents and in different directions. At its strongest, legacy takes the form of "path determination", implying that colonial choices determined post colonial ones, or at least conditioned them, such that departure from the colonial pattern was, and perhaps remains, difficult and costly. Besides asking about the strength of the influence of the past on the future, we need to consider the nature of that influence. Did colonial rule put African countries on a higher or lower path of economic change? It will be argued here that the "path(s)" on which African economies were (to a greater or lesser extent) set by the time of independence are most usefully seen not as necessarily initiated in the colonial period, but often rather as continuations and adjustments from paths of change established before the European partition of the continent.
3The following discussion has three preliminary sections. Thus, chapter 2 first attempts a summary of the economic record since independence in order to define the pattern for which colonial legacies may have been partly responsible. Chapter 3 outlines contending views of those legacies. Chapter 4 tries to define the economic and political structures and trends within Africa on the eve of the European partition of the continent. It identifies an emerging African comparative advantage in land extensive forms of production, which West Africans in particular were already exploiting and, by their investments and initiatives, deepening.
4In this framework, chapter 5 then introduces the colonial regimes, highlighting their fiscal constraints and comparing different national styles of colonial rule, focusing on the largest empires, those of Britain and France. that defined by the extent and form of European appropriation and use of land: "settler", "plantation" and "peasant" colonies. Chapter 6 considers how far colonial rule (and the actions of European companies that it facilitated) reinforced the emergence of a comparative advantage in land extensive primary exports and looks at the consequences of this for the welfare of the population. Chapter 7 explores colonial contributions, and their limits, for the very long term shift of African factor endowments from labour scarcity towards labour abundance and a relatively high level of human capital formation, such as helped Tokugawa Japan, and more recently other parts of Asia, to achieve "labour intensive industrialisation" (Sugihara 2007). Chapter 8 assesses the impact of different kinds of European regime on African entrepreneurship and on institutions facilitating, hindering or channelling African participation in markets. Chapter 9 completes the substantive discussion by commenting on the long term effects of the colonial intrusion on the capacity of the State in Africa for facilitating and promoting economic development.
2. Post colonial change and variation
5Notoriously, output per head in Sub Saharan Africa is the lowest of any major world region and has, on average, expanded slowly and haltingly since 1960. But there have been important changes, and variations over space, in policy and performance. In policy, structural adjustment in the 1980s marked a watershed: a fundamental shift from administrative to market means of resource allocation. The change, however, was less dramatic in most of the former French colonies, where (except in Guinea) the maintenance of a convertible currency had enabled governments to avoid some of the supplementary price and quantity controls which had increasingly been imposed in the mostly former British colonies outside the franc zone. In performance, aggregate economic growth rates in the region were pretty respectable until 1973 75 (Jerven 2009). Ironically, in the decade or so following the adoption of structural adjustment they were stagnant or negative, before the Chinese led boom in world commodity prices eased the region into 12 years of gross domestic product (GDP) growth at an average of 5% a year before the crises of 2007 (rising fuel and food prices, then the beginning of the international financial crisis) and 2008 brought about a "great recession" in 2009 (IMF 2009).
1 For a general account see Rimmer (1992, esp. 5, 228).
6There were notable exceptions to the general growth trends, both before and after the turning point in the early to mid 1970s. Cte d'Ivoire and Ghana made a particularly interesting contrast: similarly sized neighbours with relatively similar factor endowments and geographical features, but with different colonial heritages. Cte d'Ivoire underwent what might loosely be described as a magnified version of the standard growth trajectory. It averaged an annual GDP growth of 9.5% from 1960 to 1978 (Berthélemy and Sderling 2001, 324 5) but then had several years of stagnation followed by civil war. Meanwhile, Ghana did almost the opposite. Ghanaian GDP per capita was barely higher in 1983, when it began structural adjustment, than at independence in 1957.1 However, as one of the two most successful cases of structural adjustment in Africa (the other being Uganda), Ghana averaged nearly 5% annual growth during the quarter century after 1983. Thus, roughly, while Cte d'Ivoire was rising Ghana was falling, and vice versa. Only one Sub Saharan economy, Botswana, sustained growth over three, indeed four, decades since its independence, which was in 1966. Botswana averaged 9.3% annual growth (Berthélemy and Sderling 2001, 324 5).
3. Contrasting perspectives on the colonial legacy
2 For Africanist commentaries see Austin (2008b) and Hopkins (2009).
7A feature of the theoretical and ideological debate about the history of economic development in Africa is that it is possible to reach rather similar conclusions from very different scholarly and political starting points. Regarding the colonial impact, the case for the prosecution, which a generation ago was urged most strongly by dependency theorists and radical nationalists (Amin 1972; Rodney 1972), is now championed by "rational choice" growth economists. Daron Acemoglu, Simon Johnson and James A. Robinson (2001; 2002) have argued that Africa's relative poverty at the end of the 20th century was primarily the result of the form taken by European colonialism on the continent: Europeans settling for extraction rather than settling themselves in overwhelming numbers and thereby introducing the kinds of institution (private property rights and systems of government that would support them) that, according to Acemoglu, Johnson and Robinson, was responsible for economic development in Europe and the colonies of European settlement in North America and Australasia.2
8Colonial extraction in Africa could be seen most decisively in the appropriation of land for European settlers or plantations, a strategy used not only to provide European investors and settlers with cheap and secure control of land, but also to oblige Africans to sell their labour to European farmers, planters or mine owners (Palmer and Parsons 1977). where the land remained overwhelmingly in African ownership, we will see that major parts of the services sector were effectively monopolised by Europeans. Then there was coercive recruitment of labour by colonial administrations, whether to work for the State or for European private enterprise (Fall 1993; Northrup 1988). Of potentially great long term importance was the unwillingness of colonial governments to accept, still less promote, the emergence of markets in land rights on land occupied by Africans, whether in "settler" or "peasant" colonies (Phillips 1989). From the perspectives of both dependency theory and "rational choice" institutionalism, the original sin of colonialism in Africa was that it did not introduce a full blooded capitalist system, based upon private property and thereby generating the pressures towards competition and accumulation necessary to drive self sustained economic growth.
9A narrower but important argument was made by the then small group of liberal development economists between the 1950s and 1970s. At a time when development economists (especially but not exclusively those writing in French) tended to favour a leading role for the State in the search for development in mixed economies (Hugon 1993; Killick 1978) P. T. Bauer (1953; 1972) attacked the late colonial State for introducing statutory marketing boards and thereby laying the foundation of what he considered to be deadening State interventionism,
http://www.lacapannadifraja.it/category/hogan-outlet/.
10Explicitly positive overviews of colonial rule in Africa are rare (but see Duignan and Gann 1975). Many studies, though, mention the suppression of intra African warfare, the abolition of internal slave trading and slavery, the introduction of mechanised transport and investment in infrastructure, and the development of modern manufacturing in the "settler" economies and in the Belgian Congo. Excited by the late 20th century wave of economic "globalisation", some economic liberals have argued that the British empire pioneered the process through its general opposition to tariff protection (1846 1931) and by other pro market measures (Ferguson 2003; Lal 2004). With respect to tariffs, this case would apply less strongly to French colonies because of the protectionism of the French empire. It is also much less true of the final 30 years of British rule in Africa, which saw not only tariffs but also the creation of marketing boards. From the perspective of institutional change, a fundamental observation applicable to the region generally was highlighted by John Sender and Sheila Smith (1986). Writing in the "tragic optimist" tradition of Marx's writings on British rule in India, they emphasised that wage labour was rare at the beginning of colonial rule and increasingly common by the end of it. For them, as for Bill Warren (1980), imperialism was the "pioneer of capitalism".
11Besides optimism and pessimism,
http://www.virgiliodegiovanni.it/category/hogan-outlet, a third view of colonial rule, and by implication of its legacy, is that its importance has been over rated. There are different routes to this conclusion. about 60 years in most of tropical Africa (Ajayi 1969), and by the weakness of the colonial State (Herbst 2000). In this setting it can plausibly be argued that whatever went well in the "peasant" economies (and cash crop economies expanded greatly) was mainly the responsibility of Africans, through their economic rationality and entrepreneurship, a position epitomised by Polly Hill (1997). More ambivalent are the arguments of Jean Franois Bayart (1989; 2000). Building on the familiar observation that rulers in Africa have usually found it hard to raise large revenues from domestic sources, Bayart argues that, during colonial rule and since,
http://www.lacapannadifraja.it/category/hogan-interactive/, African elites became clients of colonial or overseas States. Thereby they forged relations which, though unequal, benefited themselves as well as the foreigners. Whereas dependency theory emphasised the primacy of foreign agency in determining historical outcomes,
http://www.cioccolart.it/category/hogan-interactive/, Bayart insists that African elites played a calculating and key role in establishing the "extraverted" pattern of African political economy.
4. A pre colonial perspective on colonial legacies
12To evaluate the colonial legacy, we need to distinguish it from the situation and trends at the beginning of colonial rule, which in most of Sub Saharan Africa occurred during the European "Scramble", from 1879 to circa 1905. At that time the region was, as before, characterised generally (not everywhere all the time) by an abundance of cultivable land in relation to the labour available to till it (Hopkins 1973; Austin 2008a). This did not mean "resource abundance" as much of Africa's mineral endowment was either unknown or inaccessible with pre industrial technology or was not yet valuable even overseas. For example, many of the major discoveries (notably of oil in Nigeria and diamonds in Botswana) were to occur only during the period of decolonisation. Moreover, the fertility of much of the land was relatively low or at least fragile, making it costly or difficult to pursue intensive cultivation, especially in the absence of animal manure. Sleeping sickness prevented the use of large animals, whether for ploughing or transport, in the forest zones and much of the savannas. The extreme seasonality of the annual distribution of rainfall rendered much of the dry season effectively unavailable for farm work. The consequent low opportunity cost of dry season labour reduced the incentive to raise labour productivity in craft production. Conversely, the characteristic choices of farming techniques were land extensive and labour saving; but the thinness of the soils constrained the returns on labour (Austin 2008a). All this helps to explain why the productivity of African labour was apparently higher outside Africa over several centuries, cf. the underlying economic logic of the external slave trades which in turn, ironically, aggravated the scarcity of labour within Africa itself (Austin 2008b; Manning 1990).
13Within Africa, the structure of incentives encouraged a high degree of self sufficiency, and by the middle of the 20th century it was widely assumed that pre colonial economies had necessarily been overwhelmingly subsistence oriented. The last half century of research has progressively changed this assessment, especially for West Africa where a strong tendency towards extra subsistence production was evident in the 16th and 17th centuries. While damaged by the aggravated "Dutch disease" effects of the Atlantic slave trade (Inikori 2007; Austin, forthcoming), this tendency was strongly resumed from the first decade of the 19th century when that trade began to be abolished, with West Africans producing on a wider and larger scale for internal as well as overseas markets. Given the relative scarcity of labour, and in the absence (generally) of significant economies of scale in production, it was rare for the reservation wage (the minimum wage rate sufficient to persuade people to sell their labour rather than work for themselves) to be low enough for a would be employer to afford to pay it. Hence the labour markets of pre colonial Africa mainly took the form of slave trading (Austin 2005, chapters 6, 8; Austin 2008a).
14The same abundance of land made political centralisation difficult to achieve and sustain (Herbst 2000). Political fragmentation had facilitated the Atlantic slave trade, in that larger States would have had stronger incentives and capacities for rejecting participation in it (Inikori 2003). This fragmentation later facilitated the European conquest. Ethiopia was the exception that proved the rule, with its fertile central provinces and large agricultural surplus supporting a long established and modernising State that,
http://www.cioccolart.it/category/hogan-sito-ufficiale, alone in Africa, had the economic base to resist the "Scramble" successfully.
2 The historiography is too complex to be summarised here. But it can be said that, although the moti (.)
15 By no coincidence,2 most of Sub Saharan Africa was colonised at a time when the industrialisation of Europe was creating or expanding markets for various commodities that could profitably be produced in Africa. The land labour ratio, the environmental constraints on intensive agriculture and also the specific qualities of particular kinds of land in various parts of the continent gave Africa at least a potential comparative advantage in land extensive primary production. By the time of colonisation, especially in West Africa, the indigenous populations were increasingly taking advantage of the combination of these supply side features and of access to expanding overseas markets. From Senegal to Cameroon thousands of tonnes of groundnuts and palm oil, and from the 1880s rubber, were being produced for sale to European merchants (Law 1995).
5. Colonial regimes: similarities and variations
16Colonial rule in Africa was intended to be cheap, viz. for taxpayers in Europe. The British doctrine was that each colony should be fiscally self supporting. Thus, any growth in government expenditure was supposed to be financed from higher revenues, as it was in Ghana in the 1920s when Governor Guggisberg was able to fund the creation of what became the country's best known hospital and school, as well as a new harbour and more railways and roads, from customs proceeds that had been fuelled by the colony's increasing exports of cocoa beans. In practice the French were equally committed to covering costs. In French West Africa too there was a major programme of public works in the 1920s, although, as also in Ghana, within a few years expenditure had to be curtailed when export prices fell and the growth of revenue ended (Hopkins 1973, 190).
17After retrenchment during the 1930s Depression, and especially during the Second World War, colonial administrations found themselves (for a variety of reasons) entering the post war era with a new public commitment to be seen to promote actively the development of the economies over which they presided. "Developmental" language was partly redeemed by greater spending. In principle this came partly from the metropolitan taxpayer. However, in the French case Patrick Manning (1998, 123 5) has calculated that the government continued to receive more in tax from Africa than it spent in Africa. In British West Africa the new statutory export marketing boards accrued substantial surpluses by keeping a large margin between the price paid to producers and the price that the boards received for the crop on the world market. The surpluses were kept in London, in British government bonds, as forced savings from African farmers (Rimmer 1992, 41 2), which assisted the British metropolitan economy to recover from the post war dollar shortage.
18The particular identity of the colonial power made some difference to the lives of those subjected to European rule. Contrasts between the two largest empires in Africa are traditionally made with reference to greater British reliance on African chiefs as intermediaries ("indirect rule") and the French doctrine of assimilating a small minority of Africans into French culture and citizenship. On the whole it is arguable that, in economic terms, the similarities were much greater than the differences, except when the latter arose from the composition of their respec
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