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Structural Impediments to African Growth? New Evidence from Real Wages in British Africa, 1880-1965

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  • Ewout Frankema

    ()
    (Utrecht University)

  • Marlous van Waijenburg
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    Abstract

    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.

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    File URL: http://www.cgeh.nl/sites/default/files/WorkingPapers/CGEH.WP_.No24.Frankema&vanWaijenburg2.pdf
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    Bibliographic Info

    Paper provided by Utrecht University, Centre for Global Economic History in its series Working Papers with number 0024.

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    Length: 55 pages
    Date of creation: Dec 2011
    Date of revision:
    Handle: RePEc:ucg:wpaper:0024

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    Postal: University of Utrecht, Drift 10, The Netherlands
    Web page: http://www.cgeh.nl
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    Keywords: Africa; living standards; real wages; labor market; colonial institutions;

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    References

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    1. Daron Acemoglu & Simon Johnson & James A. Robinson, 2000. "The Colonial Origins of Comparative Development: An Empirical Investigation," NBER Working Papers 7771, National Bureau of Economic Research, Inc.
    2. Williamson, Jeffrey G., 1999. "Real wages, inequality and globalization in latin america before 1940," Revista de Historia Económica, Cambridge University Press, vol. 17(S1), pages 101-142, March.
    3. Morten Jerven, 2010. "Random Growth in Africa? Lessons from an Evaluation of the Growth Evidence on Botswana, Kenya, Tanzania and Zambia, 1965-1995," Journal of Development Studies, Taylor & Francis Journals, vol. 46(2), pages 274-294.
    4. Robert C. Allen & Jean‐Pascal Bassino & Debin Ma & Christine Moll‐Murata & Jan Luiten Van Zanden, 2011. "Wages, prices, and living standards in China, 1738–1925: in comparison with Europe, Japan, and India," Economic History Review, Economic History Society, vol. 64(s1), pages 8-38, February.
    5. François Bourguignon & Christian Morrisson, 2002. "Inequality Among World Citizens: 1820-1992," American Economic Review, American Economic Association, vol. 92(4), pages 727-744, September.
    6. zmucur, S leyman & Pamuk, Sevket, 2002. "Real Wages And Standards Of Living In The Ottoman Empire, 1489 1914," The Journal of Economic History, Cambridge University Press, vol. 62(02), pages 293-321, June.
    7. Nathan Nunn & Nancy Qian, 2011. "The Potato's Contribution to Population and Urbanization: Evidence From A Historical Experiment," The Quarterly Journal of Economics, Oxford University Press, vol. 126(2), pages 593-650.
    8. Broadberry, Stephen N & Gupta, Bishnupriya, 2005. "The Early Modern Great Divergence: Wages, Prices and Economic Development in Europe and Asia, 1500-1800," CEPR Discussion Papers 4947, C.E.P.R. Discussion Papers.
    9. Nunn, Nathan, 2007. "The Long-Term Effects of Africa's Slave Trades," MPRA Paper 4134, University Library of Munich, Germany.
    10. Frankema, Ewout, 2010. "Raising revenue in the British empire, 1870–1940: how ‘extractive’ were colonial taxes?," Journal of Global History, Cambridge University Press, vol. 5(03), pages 447-477, November.
    11. Bates, Robert H. & Coatsworth, John H. & Williamson, Jeffrey G., 2007. "Lost Decades: Postindependence Performance in Latin America and Africa," The Journal of Economic History, Cambridge University Press, vol. 67(04), pages 917-943, December.
    12. Sue Bowden & Blessing Chiripanhura & Paul Mosley, 2008. "Measuring and explaining poverty in six African countries: A long-period approach," Journal of International Development, John Wiley & Sons, Ltd., vol. 20(8), pages 1049-1079.
    13. Ewout Frankema, 2010. "The colonial roots of land inequality: geography, factor endowments, or institutions?," Economic History Review, Economic History Society, vol. 63(2), pages 418-451, 05.
    14. Allen,Robert C., 2009. "The British Industrial Revolution in Global Perspective," Cambridge Books, Cambridge University Press, number 9780521868273.
    15. Collier, Paul, 2008. "The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done About It," OUP Catalogue, Oxford University Press, number 9780195374636, September.
    16. Rafael Dobado González & Hector García, 2009. "Neither so low nor so short! Wages and heights in eighteenth and early nineteenth centuries colonial Hispanic America," Working Papers del Instituto Complutense de Estudios Internacionales 14-09, Universidad Complutense de Madrid, Instituto Complutense de Estudios Internacionales.
    17. van Zanden, Jan L., 1999. "Wages and the standard of living in Europe, 1500 1800," European Review of Economic History, Cambridge University Press, vol. 3(02), pages 175-197, August.
    18. Paul Hoebink, 2008. "The bottom billion: why the poorest countries are failing and what can be done about it, by Paul Collier; Reinventing foreign aid, edited by William Easterly; Nouvelles migrations latino-americaines e," European Journal of Development Research, Taylor and Francis Journals, vol. 20(4), pages 733-744.
    19. Robert Allen & Robert C. Allen, 2007. "Wages, Prices, and Living Standards in China, Japan, and Europe, 1738-1925," Economics Series Working Papers 316, University of Oxford, Department of Economics.
    20. Allen, Robert C., 2001. "The Great Divergence in European Wages and Prices from the Middle Ages to the First World War," Explorations in Economic History, Elsevier, vol. 38(4), pages 411-447, October.
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    Cited by:
    1. Jerven, Morten & Austin, Gareth & Green, Erik & Uche, Chibuike & Frankema, Ewout & Fourie, Johan & Inikori, Joseph & Moradi, Alexander & Hillbom, Ellen, 2012. "Moving Forward in African Economic History. Bridging the Gap Between Methods and Sources," Lund Papers in Economic History 124, Department of Economic History, Lund University.

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