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Explaining growth in Burundi: 1960-2000

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  • Janvier D. Nkurunziza
  • Floribert Ngaruko
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    Abstract

    This study analyses Burundi’s economic performance over the period 1960- 2000 and finds that it has been catastrophic. The usual economic factors explaining growth are endogenous to political decisions, suggesting that it is politics not economics that explains the dismal performance. This picture particularly limits the relevance of textbook models that rely on the assumption of a competitive resource allocation rule. When cronies rather than qualified managers are running the economy, when priority is given to investment projects in function of their location rather than the objective needs of the economy, the economic model loses its explanatory power. Economic performance has been shaped by the occurrence of violent conflicts caused by factions fighting for the control of the state and its rents. The capture of rents by a small group have become the overarching objective of the successive governments that have ruled the country since shortly after its independence. Therefore, the economic system will not change unless the political system is modernised from a dictatorial regime playing a zero-sum game to a more democratic and accountable regime. Therefore, it would be naïve to propose that economic reforms will boost the country’s economy if they are not preceded or at least accompanied by political reforms. One central message of this study is that Burundi’s poor economic performance is the result of specific identifiable factors evolving around governance. There is nothing fundamentally wrong with Burundi: Development failure may be reversed if the issues identified in the study are properly addressed.

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    File URL: http://www.csae.ox.ac.uk/workingpapers/pdfs/2002-03text.pdf
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    Bibliographic Info

    Paper provided by Centre for the Study of African Economies, University of Oxford in its series CSAE Working Paper Series with number 2002-03.

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    Date of creation: 2002
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    Handle: RePEc:csa:wpaper:2002-03

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    1. Pritchett, Lant & Filmer,Deon, 1997. "What educational production functions really show : a positive theory of education spending," Policy Research Working Paper Series 1795, The World Bank.
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    Cited by:
    1. Robinson, James A. & Torvik, Ragnar, 2009. "A political economy theory of the soft budget constraint," European Economic Review, Elsevier, vol. 53(7), pages 786-798, October.
    2. Janvier D. Nkurunziza, 2010. "Why Is The Financial Sector In Burundi Not Development-Oriented?," EUI-RSCAS Working Papers 29, European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS).
    3. Milanovic, Branko, 2003. "Is inequality in Africa really different ?," Policy Research Working Paper Series 3169, The World Bank.

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