Researchers analyze 'Africa effect,' the slow growth of some economies

The researchers found that whatever the material situations of various African states — whether resource-scare or resource-rich, land-locked or coastal — each economy grew more slowly in Africa than it did in counterpart economies elsewhere in the world. In fact, without the “Africa effect,” they found that no natural obstacle would have prevented coastal African countries from growing at the same rate as Asian countries such as Mauritius or Thailand.

In order to explain this, several anti-growth tendencies were identified, and were labeled “syndromes.” According to the researchers, two-thirds of the 26-country sample displayed anti-growth syndromes. In explaining the root of this phenomenon, the study became one of the political economy of growth. These syndromes were often the result of policies made by ruling political parties, authoritarian regimes that sacrificed economic growth for political benefit. But still, the question remained. Why would governments choose policies that undermine the growth of their own economy? In many cases, it was in the name of their own political growth that governments sacrificed their economic growth.

“Through their policy choice, these governments used their power not to safeguard property rights but to redistribute wealth,” says Bates, the Eaton Professor of the Science of Government. “When these governments tried to regulate and control their own economy, what actually happened was that they limited the growth of their economy.”

An unusually large-scale project for work of its kind, the study involved more than 50 scholars from around the world, and encompassed case studies of the economies of 26 countries throughout sub-Saharan Africa, written by scholars native to that country, as well as a statistical study involving data from throughout the continent.

Previously, smaller groups of researchers had examined large data sets involving Africa’s economy, but what made this work extraordinary were the teams of African scholars who produced case studies, chronicling their own political economy. These political narratives augment and expound upon the results of the quantitative work.

“This study is important in understanding the political economy of Africa, but it’s not just the findings of the study that are significant, it’s the way that the findings emerged,” says Bates. “While there have been other studies that have examined the lack of economic growth in Africa in the late 20th century, this is the first study that has been done in so much depth and with so much detail. It is all the more significant because this is the first time that African scholars have authored the research, and can therefore feel a true sense of ownership and understanding.”

Bates goes on to explain that African economies began to change in the 1990s, due to political reform, and increasing pressure from human rights lobbies and the World Bank. Through the 1980s, 85 percent of Africa’s governments were authoritarian, but by the mid-’90s, that figure fell to 50 percent. The subsequent breakdown of the authoritarian regimes that contributed to these economic “syndromes” also led to economic growth in the late 20th and early 21st centuries.

“Recent political victories are not secure, and the African people must remain vigilant in order to ensure that these gains endure,” says Bates. “By understanding the causal effects of events in their political and economic history, these countries will have increased ability to knowledgeably move forward.”

In addition to the African scholars, the study brought together researchers from the University of Oxford, the University of Toulouse, and Swarthmore College, as well as Harvard. The project was funded by and through the African Economic Research Consortium (AERC), as part of its Collaborative Research Program.

The project was led by Benu Ndulu, an economist from Tanzania and the head of the regional office of the World Bank in Africa. The AERC, a group of African scholars dedicated to conducting rigorous inquiry into the economic problems of sub-Saharan Africa, managed the field research involved with the project.

The results of the project will be published this fall by the University of Cambridge Press in a book called “The Political Economy of Economic Growth in Africa.” The two-volume publication is authored by Stephen A. O’Connell, Jean-Paul Azam of the University of Toulouse, Bates, Augustin K. Fosu of the United Nations, Jan Willim Gunning of the Vrije Universiteit, and Dominique Nijinkeu of International Lawyers and Economists Against Poverty.

Source: Harvard University