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Precolonial centralisation, foreign aid and modern state capacity in Africa

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  • Broich, Tobias

    (UNU-MERIT)

  • Szirmai, Adam

    (UNU-MERIT)

  • Thomsson, Kaj

Abstract

In this paper, we empirically explore the determinants of bureaucratic capacity in contemporary Africa. We connect the aid-governance literature with the historical, political economy and anthropological literature on African state formation. Our Ordinary Least Squares (OLS) results show that there is a positive and statistically significant relationship between precolonial centralisation and bureaucratic quality in Africa from the mid-1990s onwards. Before the mid-1990s there is no such relationship. We also find that the often negative and statistically significant effect of aid dependence on bureaucratic capacity disappears, once we control for precolonial centralisation. The OLS results survive a set of robustness tests, including the addition of several control variables and instrumental variable estimation using a variety of instruments suggested in previous research. As the colonial period is slowly fading, the influence of precolonial political institutions on modern state capacity is reasserting itself. Our results provide further evidence for the importance of precolonial centralisation in our understanding of present day economic and political developments on the continent.

Suggested Citation

  • Broich, Tobias & Szirmai, Adam & Thomsson, Kaj, 2015. "Precolonial centralisation, foreign aid and modern state capacity in Africa," MERIT Working Papers 2015-025, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
  • Handle: RePEc:unm:unumer:2015025
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    File URL: https://www.merit.unu.edu/publications/wppdf/2015/wp2015-025.pdf
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    Cited by:

    1. Bernhard Reinsberg & Alexander Kentikelenis & Thomas Stubbs & Lawrence King & Centre for Business Research, 2018. "The World System & the Hollowing-out of State Capacity: How Structural Adjustment Programs Impact Bureaucratic Quality in Developing Countries," Working Papers wp503, Centre for Business Research, University of Cambridge.
    2. Stelios Michalopoulos & Elias Papaioannou, 2020. "Historical Legacies and African Development," Journal of Economic Literature, American Economic Association, vol. 58(1), pages 53-128, March.
    3. Broich, Tobias, 2017. "U.S. and Soviet foreign aid during the Cold War: A case study of Ethiopia," MERIT Working Papers 2017-010, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).

    More about this item

    Keywords

    Africa; Foreign Aid; Precolonial Centralisation; State Capacity;

    JEL classification:

    • F35 - International Economics - - International Finance - - - Foreign Aid
    • H10 - Public Economics - - Structure and Scope of Government - - - General
    • N47 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Africa; Oceania
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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