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Explaining Growth in Burundi: 1960-2000

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  • Janvier D. Nkurunziza

    (Centre for the Study of African Economies)

  • Floribert Ngaruko

    (University of Nice)

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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://128.118.178.162/eps/mac/papers/0409/0409012.pdf
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    Bibliographic Info

    Paper provided by EconWPA in its series Macroeconomics with number 0409012.

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    Length: 68 pages
    Date of creation: 15 Sep 2004
    Date of revision:
    Handle: RePEc:wpa:wuwpma:0409012

    Note: Type of Document - pdf; pages: 68
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    Web page: http://128.118.178.162

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    1. Marcel Fafchamps, 1999. "Networks,communities and markets in Sub-Saharan Africa: implications for firm growth and investment," Economics Series Working Papers WPS/1999-24, University of Oxford, Department of Economics.
    2. repec:fth:oxesaf:99-24 is not listed on IDEAS
    3. Paul Collier & Jan Willem Gunning, 1998. "Explaining African economic performance," Economics Series Working Papers WPS/1997-02.2, University of Oxford, Department of Economics.
    4. Ernest Aryeetey & Christopher Udry, 2000. "Saving in Sub-Saharan Africa," CID Working Papers 38, Center for International Development at Harvard University.
    5. Adeola F. Adenikinju & Olugboyega Oyeranti, 1999. "Characteristics and Behaviour of African Factor Markets and Market Institutions and Their Consequences for Economic Growth," CID Working Papers 31, Center for International Development at Harvard University.
    6. Paul Collier & Marcel Fafchamps & Francis Teal & Stefan Dercon, 1999. "Contract flexibility and dispute resolution in African manufacturing," Economics Series Working Papers WPS/1999-20, University of Oxford, Department of Economics.
    7. Norman Gemmell,, . "Evaluating the Impacts of Human Capital Stocks and Accumulation on Economic Growth: Some New Evidence," Discussion Papers 95/17, University of Nottingham, CREDIT.
    8. Fafchamps, Marcel & Minten, Bart, 1998. "Relationships and traders in Madagascar," MTID discussion papers 24, International Food Policy Research Institute (IFPRI).
    9. Susan M. Collins & Barry P. Bosworth, 1996. "Economic Growth in East Asia: Accumulation versus Assimilation," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 27(2), pages 135-204.
    10. Ali A. Ali & Ibrahim A. Elbadawi, 1999. "Inequality and the Dynamics of Poverty and Growth," CID Working Papers 32, Center for International Development at Harvard University.
    11. Benhabib, Jess & Rustichini, Aldo, 1996. " Social Conflict and Growth," Journal of Economic Growth, Springer, vol. 1(1), pages 125-42, March.
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