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Trade and Colonial Status

  • José De Sousa
  • Julie Lochard

Does colonisation explain differences in trade performance across developing countries? In this paper, we analyse the differential impact of British versus French colonial legacies on the current trade of African ex-colonies. We initially find that former British colonies trade more, on average, than do their French counterparts. This difference might be the result of the relative superiority of British institutions. However, a core concern is the non-random selection of colonies by the British. Historians argue that with Britain, trade preceded colonisation. Using an instrument based on colonisation history to control for this endogeneity, we find no evidence of a systematic difference between the British and French colonial legacies with respect to trade. This finding suggests that the apparent better performance of British ex-colonies might be instead explained by pre-colonial conditions.

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File URL: http://www6.rennes.inra.fr/smart/Media/Working-papers/WP10-12
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Paper provided by INRA UMR SMART in its series Working Papers SMART - LERECO with number 10-12.

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Length: 37 p.
Date of creation: 2010
Date of revision:
Handle: RePEc:rae:wpaper:201012
Contact details of provider: Web page: http://www.rennes.inra.fr/smart_eng/Working-Papers-SMART-LERECO
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  1. Santos Silva, J.M.C & Tenreyro, Silvana, 2005. "The Log of Gravity," CEPR Discussion Papers 5311, C.E.P.R. Discussion Papers.
  2. Freund, Caroline & Rocha, Nadia, 2010. "What constrains Africa's exports ?," Policy Research Working Paper Series 5184, The World Bank.
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