Working Paper: CEPR ID: DP6253
Authors: Nathan Nunn; Diego Puga
Abstract: There is controversy about whether geography matters mainly because of its contemporaneous impact on economic outcomes or because of its interaction with historical events. Looking at terrain ruggedness, we are able to estimate the importance of these two channels. Because rugged terrain hinders trade and most productive activities, it has a negative direct effect on income. However, in Africa rugged terrain afforded protection to those being raided by slave traders. Since the slave trade retarded subsequent economic development, in Africa ruggedness also has had a historical indirect positive effect on income. Studying all countries worldwide, we find that both effects are significant statistically and that for Africa the indirect positive effect dominates the direct negative effect. Looking within Africa, we provide evidence that the indirect effect operates through the slave trade. We also show that the slave trade, by encouraging population concentrations in rugged areas, have also amplified the negative direct impact of rugged terrain in Africa.
Keywords: Africa; Economic Development; Geography; Slave Trades; Terrain Ruggedness
JEL Codes: N40; N50; O11; O13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Ruggedness (L15) | Income (D31) |
| Ruggedness (L15) | Slave Trades (J47) |
| Slave Trades (J47) | Political Structures (H19) |
| Political Structures (H19) | Economic Development (O29) |