Working Paper: NBER ID: w17184
Authors: Stelios Michalopoulos; Elias Papaioannou
Abstract: We investigate jointly the importance of contemporary country-level institutional structures and local ethnic-specific pre-colonial institutions in shaping comparative regional development in Africa. We utilize information on the spatial distribution of African ethnicities before colonization and regional variation in contemporary economic performance, as proxied by satellite light density at night. We exploit the fact that political boundaries across the African landscape partitioned ethnic groups in different countries subjecting identical cultures to different country-level institutions. Our regression discontinuity estimates reveal that differences in countrywide institutional arrangements across the border do not explain differences in economic performance within ethnic groups. In contrast, we document a strong association between pre-colonial ethnic institutional traits and contemporary regional development. While this correlation does not necessarily identify a causal relationship, this result obtains conditional on country fixed-effects, controlling for other ethnic traits and when we focus on pairs of contiguous ethnic homelands.
Keywords: Africa; Ethnic Institutions; National Institutions; Economic Development
JEL Codes: N00; N17; O10; O55
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| precolonial ethnic institutional traits (F54) | contemporary regional development (R11) |
| contemporary national institutions (O43) | regional development (R58) |
| precolonial ethnic institutional traits (F54) | economic performance today (P17) |
| contemporary national institutions (O43) | differences in economic performance within ethnic groups (J15) |