Is colonialism history? The declining impact of colonial legacies on African institutional and economic development

This paper investigates the claim that colonial history has left an enduring imprint on Africa's institutional and economic development. The literature following Acemoglu, Johnson and Robinson (2001) and Sokoloff and Engerman (2000) maintains that different types of colonialism affected the institutional environment differently, and that path-dependence subsequently ensures that these institutional differences and their impact on economic performance are persistent over time. By tracing the impact of colonial institutions on contemporary institutions over time, I show that – in contrast to claims in this literature – the relevance of colonial legacies to institutional quality and to per capita income is rapidly disappearing in Africa. Differences in institutional quality or income are explained less and less by colonial legacy, while there is some evidence that precolonial social and geographical circumstances are becoming more important. I conclude that while colonialism has affected African institutional and economic development significantly, this impact is not persistent. Rather, the evidence suggests that colonialism has created a large but very temporary institutional shock, after which a long-run equilibrium is being restored.