Economics from a Historical Perspective

Economics from a Historical Perspective
Nathan Nunn
Harvard University
October 22, 2015
Nathan Nunn
Economics from a Historical Perspective
Global Distribution of World Income, 2011
Nathan Nunn
Economics from a Historical Perspective
The Evolution of Regional Incomes
Levels of Per Capita GDP, 1000-1998
25000
1990 International Dollars
20000
15000
10000
5000
0
1000
1500
1820
1870
1913
1950
1960
1970
1980
1990
Year
West. Offshoots
Western Europe
Nathan Nunn
Latin America
Asia
Africa
Economics from a Historical Perspective
1998
Historical Divergence: The Triangular Trade
Nathan Nunn
Economics from a Historical Perspective
The Rise of Western Europe (Acemoglu et al., 2005)
VOL. 95 NO. 3
ACEMOGLU ET AL.: THE RISE OF EUROPE
FIGURE 1A. WESTERN EUROPE, EASTERN EUROPE,
AND
ASIA: URBANIZATION RATES, WEIGHTED
Nathan Nunn
547
BY
POPULATION, 1300 –1850
Economics from a Historical Perspective
The Rise of the Atlantic Traders (Acemoglu et al., 2005)
FIGURE 1A. WESTERN EUROPE, EASTERN EUROPE,
AND
ASIA: URBANIZATION RATES, WEIGHTED
FIGURE 1B. ATLANTIC TRADERS, WEST EUROPEAN COUNTRIES NOT ATLANTIC TRADERS,
URBANIZATION RATES, WEIGHTED BY POPULATION, 1300 –1850
Europe, and is quite different in nature from the
European growth that took place before 1500.
Not all societies with access to the Atlantic
show the same pattern of growth, however. The
data suggest an important interaction between
medieval political institutions andNathan
access Nunn
to the
BY
AND
POPULATION, 1300 –1850
EASTERN EUROPE:
easy access to the Atlantic, even such nonabsolutist states as Venice and Genoa, did not experience any direct or indirect benefits from
Atlantic trade.
Figures 1 and 2 illustrate the central thesis
Economics
fromFigure
a Historical
Perspective
of
this paper.
1, panel
A, shows that
Africa’s Slave Trade
Nathan Nunn
Economics from a Historical Perspective
Africa’s Slave Trade
Nathan Nunn
Economics from a Historical Perspective
Africa’s Slave Trade
Nathan Nunn
Economics from a Historical Perspective
10
The Slave Trade in Africa (Nunn, 2008)
Average income per person in 2000
7.5
Mauritius
Equatorial Guinea
Seychelles
Tunisia
Botswana
Namibia
Morocco
Swaziland
South Africa
Egypt
Libya
Cape Verde Islands
Lesotho
Gabon
Algeria
Congo
Senegal
Mozambique
Ivory Coast
Benin
Ghana
Nigeria
Cameroon
Kenya
Mauritania
Sudan
Gambia
Somalia
Burkina
Faso
Liberia
Mali
Angola
Uganda
MadagascarMalawi
Guinea−Bissau
Central AfricanZambia
Republic
Ethiopia
Burundi
Guinea Togo
Tanzania
Niger
Sao Tome & Principe Zimbabwe
Djibouti
Rwanda
Comoros
Chad
Sierra Leone
5
Democratic Republic of Congo
−4
0
5
Slave exports normalized by land area
Nathan Nunn
Economics from a Historical Perspective
11
Plantation Slavery in the Americas
Nathan Nunn
Economics from a Historical Perspective
Plantation Slavery in the Americas (Nunn, 2008)
e ( ln per capita GDP, 2000 | X )
0
2.1
Partial correlation plot: slavery in 1750 and income in 2000
United States
Canada
Bahamas
Argentina
Netherlands Antilles
Chile
Mexico
Uruguay
Barbados
Trinidad & Tobago
Antigua& &Nevis
Barbuda
St. Christ.
Brazil
Dominican
Republic
Colombia
Venezuela Grenada
Cuba
Belize
Dominica
Peru
Paraguay St. Lucia
St. Vincent & Gren.
Suriname
Guyana
Ecuador
Jamaica
−2
Haiti
−.6
0
e ( slaves / total population, 1750 | X )
.6
coef = −2.63, se = .42, t = −6.23
Nathan Nunn
Economics from a Historical Perspective
Traditional Views on Economic Development
1
Short-run factors like: capital, health, education, and
policies.
2
More fundamental slow-moving factors like: domestic
institutions, social norms, or cultural traits.
3
Geography.
Nathan Nunn
Economics from a Historical Perspective
Dispersion of Income and Investment (Grier and Grier,
2007)
28
K. Grier, R. Grier / Journal of Development Economics 84 (2007)K.25–45
Grier, R. Grier / Journal of Development Eco
(a) Real per capita GDP
Nathan Nunn
(b) Capital Investment
Economics from a Historical Perspective
Dispersion of Schooling
K. Grier, R. Grier / Journal of Development Economics 84 (2007) 25–45
(c) Primary schooling
(d) Secondary schooling
Fig. 3. The dispersion of primary and secondary school enrollment rates across 90 countries.
Finally, Panels B and C of Figs. 4 and 5 examine the behavior of government spen
openness across the two country groupings. Again, both sub-samples show s
convergence behavior. When we again consider inflation and the black market pre
find no evidence of divergence over time for either series in either country grouping. Th
countries evolve in a manner consistent with the neoclassical model, but the 68 d
countries present striking evidence against the model.
2.3. What
about papers
findingfrom
conditional
convergence?
Nathan
Nunn
Economics
a Historical
Perspective
Dispersion of Policies
32 Economics 84 (2007)
K. 25–45
Grier, R. Grier / Journal 31
of Development Eco
K. Grier, R. Grier / Journal of Development
(e) Government spending
Nathan Nunn
(f) Openness to trade: (X+M)/Y
Economics from a Historical Perspective
Traditional Views on Economic Development
1
Short-run factors like: capital, health, education, and policies.
2
More fundamental slow-moving factors like: domestic
institutions, social norms, or cultural traits.
3
Geography.
Nathan Nunn
Economics from a Historical Perspective
ists living in the southeastern Peruvian Amazon, behaved
much less prosocially than student populations around the
3.2. Ethnographic description
Was this simply an odd result, perhaps due to the unusual
circumstances of the experiment, or had Henrich tapped
real behavioral differences, perhaps reflecting the distinct
discussed here. In selecting these, we included societies
both sufficiently similar to the Machiguenga to offer the
possibility of replicating the original Machiguenga results,
the location of each field site, and Table 1
world (Henrich Culture
2000). The UG “Machiguenga
outlier” etFigure
Measuring
(Henrich
al.,1 shows
2005)
provides some comparative information about the societies
sparked curiosity among a group of behavioral scientists:
Figure 1.
Locations of the 15 small-scale societies.
BEHAVIORAL AND BRAIN SCIENCES (2005) 28:6
Nathan Nunn
Economics from a Historical Perspective
799
The Ultimatum Game
Nathan Nunn
Economics from a Historical Perspective
lack any stable
Culture
ecision-making
sified as family
el societies, exties or nonkin
re. In these cirins ephemeral
of both related
perate in ecoubstantially on
of prestigious
s and clans are
complexity, and
are organized
rom a common
signed accordlays some role.
nd political orveral unrelated
in the hands of
larger scale of
re composed of
council of older
uncils is often
and achieved
s act only to orict, and may or
On the responder side of the UG (Figure 3), rejection
and
Integration
(Henrich
et al., 2005)
ratesMarket
are also quite
variable. In some
groups, rejections
were extremely rare, even in the presence of low offers, but
Figure 2. A bubble plot showing the distribution of UG offers
for each group. The size of the bubble at each location along each
Nathan Nunn
Economics from a Historical Perspective
The Lamalera
Nathan Nunn
Economics from a Historical Perspective
The Lamalera
Nathan Nunn
Economics from a Historical Perspective
Origins
of Distrust
in Africa
(Nunn
andTown,
Wantchekon,
anner
of enslavement
for a sample
of slaves
from Free
Sierra Leone.2011)
The sla
wed by Sigismund Koelle during the 1840s.
Table 1. The Method of Enslavement of Koelle’s Informants
Manner of Enslavement
Taken in a war
Kidnapped or seized
Sold/tricked by a relative, friend, etc.
Through a judicial process
Percentage
24.3%
40.3%
19.4%
16.0%
Notes: The data are from Sigismund Koelle’s Linguistic Inventory. The
sample consists of 144 informants interviewed by Koelle for which their
means of enslavement is known.
sample, the most common manner of enslavement was kidnappings, with ju
Economics
from a Historical
Perspective
he slaves in the sample being Nathan
takenNunn
in this
manner.
The next
most common m
Origins of Distrust in Africa (Nunn and Wantchekon, 2011)
Atlantic Slave Exports
0
1 - 50,000
50,001 - 100,000
10,0001 - 1,000,000
1,000,001 - 4,000,000
Nathan Nunn
Economics from a Historical Perspective
cent) (box map 5.1.1). Despite large cross-regional differences, participation rates have converged over time as countries and regions
that started with very low rates (primarily Latin America and the
Middle East and North Africa) experienced large increases and
those with higher rates (primarily Europe and Central Asia and East
Asia and Pacific) experienced small declines (box figure 5.1.1).
the form of rising demand for female labor and, in some cases,
higher absolute and relative wages.
In addition, economic development has been accompanied by
improvements in infrastructure, including electricity, water, roads,
and transport, which can alleviate time constraints and reduce the
Female Labor Force Participation
B OX M A P 5.1.1 Female labor force participation—Some high rates and some low
70+
60–<70
50–<60
40–<50
0–<40
No data
Countries
with the
highest FLFPR
Source: International Labor Organization (2010a).
Nathan
Burundi
Tanzania
Rwanda
Madagascar
NunnMozambique Economics
92%
89%
88%
86%
86%
from a Historical Perspective
Countries
with the
lowest FLFPR
Countries
with the
highest FLFPR
Gender Norms around the World
Burundi
Tanzania
Rwanda
Madagascar
Mozambique
Pakistan
Saudi Arabia
Syrian Arab Republic
Yemen, Republic of
Iraq
92%
89%
88%
86%
86%
22%
22%
22%
21%
15%
0
Nathan Nunn
50
female labor force participation rate, %
Economics from a Historical Perspective
100
Origins of Gender Norms (Alesina, Giuliano and Nunn,
2013)
Nathan Nunn
Economics from a Historical Perspective
Origins of Gender Norms (Alesina, Giuliano and Nunn,
2013)
Nathan Nunn
Economics from a Historical Perspective
e(Female labor force participation in 2000 | X)
−40
0
40
Traditional Plough Use and FLFP
VUT
THA
LAO
KHM
CHN
VNM
TZA
MDG
PNG
PER
BDI
GIN GAB
AGO
UGA
ROU BRN
MOZ
KEN
DJI
BOL
KAZ
LSO
JAM
AZE BHS MNG
COGBRA
MRT SGP
PRT
COM
ZWEBFA
ISR
IDN
CYP
TKM
URY
CAF
KWT
NOR
GHA CAN
DNK MYS
NAM
VCT PAN NCL GMB
SWE
ETH
CPHL
HEFIN AUS
LTU
USA
DOM
ARG RUS
SVK
BIH
TTO HTI
CZE
NZL
SWZ
JPN
VEN
SVN
EST
LBRUZB
ARM
ALB
BLR
SEN
GBR
KOR
ECU
LCA
ZAF
NLD
GRC
POL
BGD
CMR
NPL
MDA GEO
MWI
BEN
LVA
BHR
MDV
SLE
FRA
GUY
PRY
BGR
MUS CRI GTM
DEU
DZA
AUT
ESP
ARE
TCD
CPV
H
RV
BLZ
FJI
ZMB
UKR
BTN
KGZ
IRL
SLV
ITA
ERI
CIV
HND
CHL
MEX
BELIRN
LBY LKA
MKD
TGO HUN
PRI
GNQ COL
OMN
MLT
SUR
NIC
EGY
TUR
LUX GNB
MAR
SAU
TUNJOR
IND
NGA
SYR
LBN
ZARSLB
SDN
MLI
NER
YEM
PAK
ISL
−1
BWA
RWA
0
e(Traditional plough use | X)
TJK
1
(coef = −12.401, t−stat = −4.18)
Nathan Nunn
Economics from a Historical Perspective
e(Share of firms with female ownership, 2003−2010 | X)
−40
0
40
Traditional Plough Use and Female Firm Ownership
VCT
PHL
KGZ
VNM
MNG
MLI
NIC CIV BRA
GUY
MDA
KNA
LBR
ZWE
GRD
BWABHS CAF
PRT
AGOBLR
MDG
ROU
VUT
IDNPRY
RWA
FJI
LAO
POL
BOL UKR
TTO
IRL
CRIUZB
TCD
TUR
ZAR
GTM
LVA
TJK
BDI
GHA
ARG
HND
EGY
BEN
SVN
ETH
HUN GEO
DMA
UGA
BTN ESP
KEN
NAM
KAZ JAM
COL
SLV
LTU
PER
ZMB MKD
VEN EST
NPL
LBN
RUS ARM
BGR
CPV
LCA
BLZ
GAB
SWZ
MRTGRCLKADOM
HRV
CHL
TZA
BIH
ECU
TGO
PAN
MEX SVK
DZA URY
NER
MOZ
ZAF
SEN DEU
MWI
CZE
ATG
LSO
AZE GIN
SUR
BFA
KOR BGD
GMB
NGA
SYR MAR
GNB MYS JOR
CMR
MUS
YEM
PAK ALB
INDERI
SLE
−1
0
e(Traditional plough use | X)
1
(coef = −15.241, t−stat = −3.75)
Nathan Nunn
Economics from a Historical Perspective
Traditional Views on Economic Development
1
Short-run factors like: capital, health, education, and policies.
2
More fundamental slow-moving factors like: domestic
institutions, social norms, or cultural traits.
3
Geography.
Nathan Nunn
Economics from a Historical Perspective
Geography and Income
ht review articles
obal
of per capita
bal pattern of
ibution is
n, with
ome levels
lower in
ons.
Tropic of Cancer
Tropic of Capricorn
GDP per capita 1995
US$450–1,999
US$2,000–4.999
US$5,000–9,999
US$10,000–15,999
US$16,000–31,100
No data
dical costs associated with the disease, as well as some
f the income that is foregone as a result of malaria
and mortality. Private medical costs refer to personal
explore some of these additional pathways through which malaria
affects economic development.
Nathan Nunn
Economics from a Historical Perspective
Historical Impacts of the TseTse Fly in Africa (Alsan,
2014)
Nathan Nunn
Economics from a Historical Perspective
Reanalysis for the year 1871. Panel B shows the suitability for rainfed agr
Historical Impacts of the TseTse Fly in Africa
Panel A
Panel B
0.25
0.25
0.2
0.2
0.15
0.15
0.1
0.1
0.05
0.05
0
0
0–25%
26–50%
51–75%
76–100%
0–2
Large domesticated animals
Intensively cultivate
City 1800
Plow use
Political centralization
Figure 4. Weighted
Average
Precolonial Outcome
Economics from
a Historical Perspective
Nathan Nunn
Historical Impacts of Ruggedness (Nunn and Puga, 2011)
Nathan Nunn
Economics from a Historical Perspective
Historical Impacts of Ruggedness
Nathan Nunn
Economics from a Historical Perspective
Historical Impacts of Ruggedness
Nathan Nunn
Economics from a Historical Perspective
Historical Impacts of Ruggedness
Nathan Nunn
Economics from a Historical Perspective
Historical Impacts of Ruggedness
12
Income and Ruggedness among Non−African Countries
(coef. = −.213, t−stat. = −2.38, N = 121)
Log Real GDP per Person 2000
9
LUX
NLD
SGP
BHS
KNA
ATG
DMA
NOR
USA
IRL
CHE
AUT
CAN FRA ISL
JPN HKG
FINBEL GBR
DEUSWE
ISR PYF ITA
PRINCL
ESP
ARE
CYP
MAC
PRTMLT NZL SVN GRC
KOR
KWT
BHR
CZE
BRB
HUN
SAUOMN
ARG
SVK
POL
EST
HRV
MEX CRI CHL
MYS
URY TTO
LTU
LVA BRA
GRD
RUS
TON
TUR
DOM
COLTHA ROUBGR
PAN
BLZ
IRNMKD
VEN
LCA
VCT
BIH
FJI WSM
BLR PRY KAZ
PER
SLV
LBN
GUY UKR
PHL
GTM
CHN
JOR
ALB
TKM
JAM
LKA
ECU
NIC
SYR IDN
VUT
AZE
HND
ARM
BOLIND
PNG
VNM
GEO
SLB PAK
KHM
HTI
MNG
LAO
KGZ
UZB
BGD
MDA
NPL
DNK
AUS
TJK
6
YEM
−3
0
Ruggedness (Box−Cox Transformed)
Nathan Nunn
Economics from a Historical Perspective
3
Historical Impacts of Ruggedness
12
Income and Ruggedness among African Countries
Log Real GDP per Person 2000
9
(coef. = .242, t−stat. = 1.82, N = 49)
SYC
GNQ
MUS
BWA
GAB
DZA
ZAF
TUN NAM
CPV
EGY
ZWE
GHA
CMR GINAGO
GMB
SDN
CIV
TGO
SEN
UGA
CAF
KEN
BEN
COG BFANGA
MOZ
MDG
TCD
GNB
MLI
ZMB
NER
COD
ETHBDI
MWI
TZA
SLE
6
MRT
−3
SWZ
MAR
DJI
ERI
LSO
COM
RWA
0
Ruggedness (Box−Cox Transformed)
Nathan Nunn
Economics from a Historical Perspective
3
Conclusions
We really cannot understand economic development today
without thinking about history and how we got here.
Next question: What implications does this have for economic
policy moving forward?
Nathan Nunn
Economics from a Historical Perspective