Working Paper
How Does Colonial Origin Matter for Economic Performance in Sub-Saharan Africa?

This paper investigates some of the existing hypotheses regarding the transmission of different colonial legacies to modern day economic growth. The fact that different colonial strategies were pursued by different colonizers in various territories suggests possible ramifications for current development paths. This paper attempts to understand why economic growth performance is different even among African countries, where former British colonies appear to do marginally better. It focuses on two key channels of transmission, namely education and trade. Thirty-six Sub-Saharan African countries during the period 1960–2000 are considered using Hausman-Taylor estimation technique in an annualized panel data framework. In contrast with the methodology of previous studies where only the initial conditions at independence were held to influence the post-colonial growth path, this study attempts to distinguish the direct influences of colonization from the indirect influences by combining both the initial conditions at independence alongside the subsequent post-independence changes in explaining growth differences amongst former Sub-Saharan African colonies. The results suggest that the indirect influences of colonial educational policies matter more for post-colonial growth than the direct influences.