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The great divergence in South Africa: Population and wealth dynamics over two centuries

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  • Fintel, Dieter von
  • Fourie, Johan

Abstract

Does wealth persist over time, despite the disruptions of historical shocks like colonisation? This paper shows that South Africa experienced a reversal of fortunes after the arrival of European settlers in the eastern half of the country. Yet this was not because of an institutional reversal. We argue, instead, that black South Africans found themselves at the mercy of two extractive regimes: one in ‘white South Africa’ and another in the ‘homelands’. The political and economic institutions of each of those regimes favoured a small elite: in white South Africa, whites, and in the homelands, the black chiefs and headmen. Democracy brought inclusive institutions for black residents in white South Africa but not for those in the former homelands. This is why we see mass migration to the urban areas of South Africa today, and why addressing the institutional weaknesses of the former homelands are key to alleviating the poverty in these regions where a third of South Africans still reside.

Suggested Citation

  • Fintel, Dieter von & Fourie, Johan, 2019. "The great divergence in South Africa: Population and wealth dynamics over two centuries," Journal of Comparative Economics, Elsevier, vol. 47(4), pages 759-773.
  • Handle: RePEc:eee:jcecon:v:47:y:2019:i:4:p:759-773
    DOI: 10.1016/j.jce.2019.08.005
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    Cited by:

    1. Johan Fourie, 2020. "The settlers of South Africa and the expanding frontier," Working Papers 14/2020, Stellenbosch University, Department of Economics.
    2. Daniel de Kadt & Johan Fourie & Jan Greyling & Elie Murard & Johannes Norling, 2020. "The causes and consequences of the 1918 influenza in South Africa," Working Papers 12/2020, Stellenbosch University, Department of Economics.

    More about this item

    Keywords

    Reversal of fortunes; Population persistence; Institutional reversal; Colonial impact; Settler economy; African economic history; Traditional leaders;

    JEL classification:

    • N97 - Economic History - - Regional and Urban History - - - Africa; Oceania
    • N37 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Africa; Oceania
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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