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
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