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How Does Colonial Origin Matter for Economic Performance in sub-Saharan Africa?

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Abstract

This paper investigates the channels through which colonial origin affects economic outcomes in sub-Saharan Africa (SSA). It focuses on four key channels of transmission namely, human capital, trade openness, market distortion and selection bias. In contrast with previous studies where only initial conditions at independence were held to influence the subsequent growth path, the methodology that we apply in this paper combines (1) the pre-colonisation initial conditions, (2) the initial conditions at independence and (3) the subsequent post-colonial changes in explaining income differences amongst former SSA colonies. Our sample comprises of 38 SSA countries studied over the period 1960-2000, and we use pooled OLS and Hausman-Taylor estimation techniques in a panel framework. The results suggest that former British colonies have had marginally higher income levels than former French colonies, and this is attributable to the legacy of British colonisation in trade openness and human capital. We do not find robust evidence in support of the market distortion and selection bias channels. Besides highlighting the importance of the trade openness channel, the study is also the first, to the best of our knowledge, to simultaneously examine a range of feasible transmission channels between colonial origin and economic growth performance.

Suggested Citation

  • J.A. Agbor & J. W. Fedderke & N. Viegi, 2010. "How Does Colonial Origin Matter for Economic Performance in sub-Saharan Africa?," Working Papers 176, Economic Research Southern Africa.
  • Handle: RePEc:rza:wpaper:176
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    Cited by:

    1. Asongu Simplice, 2012. "Reversed Economics and Inhumanity of Development Assistance in Africa," Working Papers of the African Governance and Development Institute. 12/034, African Governance and Development Institute..
    2. Asongu, Simplice, 2018. "CO2 emission thresholds for inclusive human development in Sub-Saharan Africa," MPRA Paper 89130, University Library of Munich, Germany.
    3. Asongu Simplice, 2012. "How has Mobile Banking Stimulated Financial Development in Africa?," Working Papers of the African Governance and Development Institute. 12/027, African Governance and Development Institute..
    4. Simplice A., Asongu, 2011. "Law, Finance and Investment: does legal origin matter?," MPRA Paper 34698, University Library of Munich, Germany.
    5. Simplice A. Asongu, 2015. "Law,Finance, Economic Growth and Welfare: Why Does Legal Origin Matter?," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 7(2), pages 30-55, July.
    6. Simplice A., Asongu, 2011. "Law, economic growth and human development," MPRA Paper 34082, University Library of Munich, Germany.
    7. Agbor, Julius A & Fedderke, Johannes W & Viegi, Nicola, 2013. "How colonial education practices helped shape the pattern of decolonization in West Africa," International Journal of Development and Conflict, Gokhale Institute of Politics and Economics, vol. 3(2), pages 1-23.
    8. Simplice A, Asongu, 2012. "The political economy of development assistance: peril to government quality dynamics in Africa," MPRA Paper 36543, University Library of Munich, Germany.
    9. Asongu Simplice, 2011. "Government Quality Determinants of Stock Market Performance in African Countries," Working Papers of the African Governance and Development Institute. 11/019, African Governance and Development Institute..
    10. Ekkayokkaya, Manapol & Foojinphan, Pimnipa & Wolff, Christian C.P., 2017. "Cross-border mergers and acquisitions: Evidence from the Indochina region," Finance Research Letters, Elsevier, vol. 23(C), pages 253-256.
    11. Simplice A, Asongu, 2011. "Government quality determinants of stock market performance in developing countries," MPRA Paper 35508, University Library of Munich, Germany.
    12. Simplice A. Asongu, 2016. "Law and Investment in Africa," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 8(2), pages 95-124, April.
    13. Asongu Simplice, 2011. "Democracy and Stock Market Performance in African Countries," Working Papers of the African Governance and Development Institute. 11/021, African Governance and Development Institute..
    14. Simplice A, Asongu, 2012. "New indicators for the mobile banking nexus," MPRA Paper 38575, University Library of Munich, Germany.
    15. Asongu Simplice, 2011. "Law, Democracy and the Quality of Government in Africa," Working Papers of the African Governance and Development Institute. 11/018, African Governance and Development Institute..

    More about this item

    Keywords

    Colonial Origin; Human Capital; Institutions; Hausman-Taylor; sub-Saharan Africa;

    JEL classification:

    • F54 - International Economics - - International Relations, National Security, and International Political Economy - - - Colonialism; Imperialism; Postcolonialism
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • I20 - Health, Education, and Welfare - - Education - - - General
    • N17 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Africa; Oceania

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