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Historical legacies: A model linking Africa's past to its current underdevelopment

  • Nunn, Nathan

Recent studies have found evidence linking Africa’s current underdevelopment to colonial rule and the slave trade. Given that these events ended long ago, why do they continue to matter today? I develop a model, exhibiting path dependence, that explains how these past events could have lasting impacts. The model has multiple equilibria: one equilibrium with secure property rights and a high level of production and others with insecure property rights and low levels of production. I show that external extraction, when severe enough, causes a society initially in the high production equilibrium to move to a low production equilibrium. Because of the stability of low production equilibria, the society remains trapped in this suboptimal equilibrium even after the period of external extraction ends. The model provides one explanation why Africa’s past events continue to matter today.

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Article provided by Elsevier in its journal Journal of Development Economics.

Volume (Year): 83 (2007)
Issue (Month): 1 (May)
Pages: 157-175

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Handle: RePEc:eee:deveco:v:83:y:2007:i:1:p:157-175
Contact details of provider: Web page: http://www.elsevier.com/locate/devec

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