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Political Equality and the Performance of African Economies, 1972-1999

Today, thirty-two African countries are poorer than they were in 1980, and some are poorer than they were in 1960. Since the slowdown of Africa's growth in the 1970s, the gap between the region and other comparable developing regions has averaged 1.5-2.5% per year, depending on samples and measures. The ramifications of stagnation for poverty and human development have been severe, with life expectancy in many countries dropping to below forty in recent years. Many economists and political scientists emphasize the role of poor economic management in the decline of African economies. This study draws from the literatures on African politics and the political economy of economic management, formulating a unique game-theoretic framework for thinking about the incentives facing policy elites. The key result is that increases in the concentration of political resources – factors which provide social actors with influence in the selection of policy elites – generate incentives for policy elites to under-provide public goods, tax heavily, and provide particularistic transfers to narrowly-based and politically powerful actors. The result is primarily concerned with the results of autocratic institutions and narrowly based governments, rather than with the supposed power of private interest groups. The study then turns to the growth record of African countries, focusing not on the average gap between African economies and those of other regions, but on variance within the Africa sample itself. This is a complementary task to the world-data regressions which currently dominate the literature on the performance of African economies, and demonstrates that a number of the common conclusions of that literature do not hold within the Africa sample itself. The study then uses panel data to demonstrate a large and robust relationship between political openness and overall and sectoral growth across African economies and across time, such that the difference in political openness between the most democratic and the least democratic African state is associated with a growth gap of over 4.5 percentage points per year.