01 Dec Africa: Why Economists Get It Wrong
By Andy Wynne and Abiodun Olamosu
Morten Jerven Africa: Why the Economist Got it Wrong (London, Zed Books: 2015)
This book provide a critical review of the recent economic history of Africa. He argues that, for most of the past two decades, mainstream economists have been trying to explain the chronic failure of economic growth in Africa. In contrast, during the 1950s, the 1960s and even into the 1970s many African economies actually grew rapidly, but this development was subsequently overshadowed by the economic problems of the 1980s and 1990s.
In recent years, this pessimism has changed to the undue optimism of ‘Africa Rising’ with sustained economic growth in a situation which is unlikely to be replicated or sustained for very long. However, per capita GDP in Africa is still way below that in the industrialised countries. The dominant reason for this is held to be bad governance and poor institutions, but this argument may be overstated, for example, the Chinese economy has clearly expanded massively in recent years without good governance in the western sense.
Morten’s main message is quite simple. He argues that we “need to rephrase the central research question about African economic growth. The question is not ‘Why has Africa failed?’ but ‘Why did African economies grow and then decline only to grow again?’” (page 8).
The encouragement for a critical historic reading of African economic is useful, but Morton does not go far enough. He recognises that the “GDP numbers tell us too little about what has really happened or about whether living conditions on the African continent are improving” (page 5). But then he says little to differentiate between average economic growth of a region and its impact on the 99% or even the bottom 50% of the population.
Recent economic growth in Africa has taken place in societies that are significantly more unequal than they were in the 1960s. As a result, most of the recent economic growth has been grabbed by the already rich ruling elite. Many Africans are still living in chronic poverty which is not significantly better than when they gained independence in the nineteen sixties. Redistribution of wealth and income resulting from collective action by the working class and other poor people of Africa would actually achieve significant poverty reduction, something that the economic growth of recent years has not achieved.
Morten also points out that the economic data on Africa is relatively sparse and inaccurate (but then uses this as an excuse for little real action having been taken on poverty reduction). As a result of this poor data, poor theories are developed, especially about the poor of the continent. Although Morten does not take this final step, he does acknowledge that some of the supposed causes of poor economic growth are better seen as symptoms of growing poverty. The real value of public servants’ salaries reduced significantly in the 1980s across many African countries leading to increased corruption and a deterioration in governance.
Morten provides a very useful explanation or argument of why western policies or technologies cannot simply be grafted onto the current reality of Africa. Was it really poor political institutions that explain why the plough, for example, was not adopted more widely and more quickly across Africa? Morten answers with three simple propositions. First, trypanosomiasis or sleeping sickness, carried by the tsetse fly, is endemic to large areas of sub-Saharan Africa except for South Africa. At least in the core tropical forest zone, its prevalence made it impossible to keep cattle and so the plough was not efficient. Second land was relatively abundant and so shifting cultivation was still possible and there was no incentive to adopt labour intensive practices like ploughing. Finally, tropical soils are fertile only to a shallow depth and the risk of erosion is significantly increased through the adoption of ploughing. A similar effect was dramatically shown in the Great Plains of America in the 1930s when millions of acres of natural grassland was ploughed to plant wheat. The result was the Dust Bowl. This is an important lesson which many aid agencies have yet to learn. There are no simple or standard answers, for example, aspects of ‘good governance’ which should just be adopted across sub-Saharan Africa. Successful reform is complex and has to fit and be appropriate for local conditions.
As we outlined in our recent paper on the economic history of Africa since independence, Morten accepts that Africa’s economic growth failure in the 1980s and 1990s happened because of a combination of external economic shocks and (as he understates) “a less-than-perfect policy response” (page 125). The result, as Morton accepts, were a series of misguided structural adjustment policies (SAPs). Dependence on world markets for primary commodity exports lead to a convergence of negative economic performance in the 1980s, with only a few exceptions. African economies embarked on relatively homogenous policies that were not suited to heterogeneous country conditions.
Morten, dismisses Karl Marx, by saying that he wrote that “the more developed countries showed the last developed the image of their own future” (132), but that this interpretation of economic development has been debunked timeline again. Despite this, there is much that we can learn from Morten’s short book, especially his encouragement for non-economists to read economics more critically and the need to analyse the specific conditions of individual African economies rather than generalising from the European experience.
We have to properly understand actual economic history and how and why different institutions have developed and the subtle nuances between. As Morten concludes, we should focus on how African economies work rather than only explaining why they don’t. However, this book is only a step in the right direction, we still need to develop a deeper understanding of African economies from the point of view of the poor and working classes and how their collective action could help to bring about the fundamental change and redistribution of wealth and power that is so badly needed.
Abiodun Olamosu is a trade unionist and activist from Nigeria. Andy Wynne is a Senior Lecturer in Public Financial Management at the University of Leicester and a consultant who has worked extensively in West Africa.