Introduction
Sub-Saharan Africa, Africa for the purpose of this study, stands as among the most poverty-stricken areas in the world. Much of the poverty currently experienced by Africa right now arises from its numerous problems with its political and economic institutions. Said institutions have led Africa to become a continent whose people did not engage in investment activities and political leaders did not provide public goods in accordance to their constitutionally recognized mandates. Moreover, despite the continuous influx of foreign aid coming from the United Nations (UN), International Monetary Fund (IMF), World Bank and agencies such as US Agency for International Development (USAID), Africa continues to suffer in poverty. This study focuses on how such institutions came about in Africa and the extent of their negative effects on the continent. Although there is an understanding that there is no society with a ready-made institutional format enabling economic growth suitable for the modern times, certain elements of such have prevailed within certain societies. Historical circumstances have enabled different societies from having mixed experiences on growth, which occurred through institutional transitions. Africa, given its current situation mired in poverty, took off from institutional transitions vastly different compared to those experienced in Europe and Asia. Path dependency greatly hampered the prospects of Africa on growth, as manifested by the rise of authoritarian regimes and laggard economic growth in the continent, in turn influenced by its disastrous history involving the slave trade and colonization by European powers between the 19th and 20th centuries.
The Rationale of Institutional Analysis
Admittedly, researching on the continuing poverty in Africa through institutional analysis stands as a remarkably more reasonable direction compared to using cultural and geographical modes of reasoning. The existing literature on cultural and geographical considerations explaining poverty in Africa is currently lacking in terms of empirical results. Whereas such concern is definitely not within the scope of this study, it nevertheless encourages the production of future studies to enrich the present findings gathered using the institutional analysis. The divergence of African institutions from those of Europe and Asia arises not from geographical considerations, as there is insufficient proof establishing that, but from its historical experiences. One may even come to consider that African institutions have gone through unfortunate phases, particularly in terms of the unwanted involvement of Africa in the slave trade. More so, the slave trade further hampered any prospects for Africa to benefit from institutional development arising in Europe and Asia, given that it has found itself locked within the slave trade cycle. Even in the 19th century, when the slave trade came to a halt, Africa remained unfortunate as it struggled to develop its endogenous institutions in the face of colonization by the European powers and their exploitative interests. Authoritarianism, corruption and economic sabotage all emerged under European rule in Africa, a pattern that eventually found its place on path dependency once African nations began gaining independence. Understanding the foregoing patterns would not have transpired well through an analysis based on cultural and geographical considerations. Institutional analysis, which has necessitated considerations from the history of Africa, best explains why the continent remains in poverty (Herbst, 2000; Lipton, 1979).
The institutional analysis duly succeeded in establishing the premise that certain societies have went on to possess components crucial to the development of institutions towards modern economic growth. Such would not have been possible without particular historical triggers that necessitated action from significant elements within societies. Although no society has ever possessed elements needed for sustained economic progress by default, historical experiences have enabled many societies to sustain their progress within varying lengths of time. Sustenance, or the lack thereof, of progress in societies greatly relies on the various responses to various emancipatory events, may it be in the form of reforms or crises. For the purpose of this study, a closer look shows that societies that have posed long-lasting progress have emerged in Africa – the Aksum, Ghana and Mali being some of the finest examples. Such attributes to the cultivation of endogenous institutions that suited existing normative conditions in Africa - a factor greatly damaged during the slave trade and colonial era. One could perhaps compare said African societies to Ancient Greece and Ancient Rome, among many other significant European societies, yet their relatively laggard pace in institutional development is traceable through the lack of innovations transpiring and arriving within their areas (Herbst, 2000; Lipton, 1979).
For innovations to transpire smoothly within societies, it is important for particular events to transpire in a timely manner. Threats posed by empires in Europe and Asia, for instance, have necessitated the construction of sophisticated vessels and military arsenal developed with military victories in mind. The Black Death, another historically compelling example, has prompted serfdom to tighten its grip throughout the rest of Europe due to the lack of fit and proper people to tend to agricultural lands. Unfortunately, for Africa the historical triggers it has experienced prompted its drastic decline continuing to the present times. The arrival of European powers – initially during the slave trade then next during the colonial era, has damaged the prospects of Africa towards developing its forlorn institutions endogenously and without any external interferences. The commoditization of African people during the slave trade has denied Africa from ever getting involved constructively in the development consensus of Europe and the Americas that time. The fact that African people were highly exploited and denied of the same rights and privileges granted unto their European counterparts due to their commoditization has denied Africa of ever gaining a real change to develop its institutions endogenously. Moreover, the fact that Africa has failed to defend itself from the clutches of European colonizers due to undeveloped technologies and destabilization through the divide-and-conquer approach to colonization has led the continent to a negative path-dependent direction. Such provides for the reason behind the continuing suffering experienced by many Africans in present times (Acemoglu et al., 2005a; Austin, 2008; Herbst, 2000; Young, 1994).
Independence, while providing greater hope for many Africans, did not immediately lead to reforms towards modern economic development. The institutional analysis this study has employed thoroughly explains that Africa followed path dependency in its post-independence institutional development. Understandably, such has caused Africa with greater peril. The experiences Africa had under colonialism, characterized by oppression and exploitation under authoritarian and patrimonial regimes, help provide reasons behind the continuing suffering Africa has experienced even as its nations have reached independence. Unsurprisingly, many African nations that gained independence followed the same authoritarian and patrimonial path of colonial regimes, for there has been no compelling influence coming from relatively democratic sources. Given the cultivation of the impression that political power brings forth prestige and control over vast material domains of any given nation, it makes sense to presume that political leaders in postcolonial Africa sought the same incentives by propagating the same kind of control exercised by their past colonial tormentors. Colonial exploitation of resources became internalized corruption in many African nations in the postcolonial era. Patronage politics became the key for many people to gain favors from authoritarian regimes, which in reality did not favor anything aside from self-interests. Poverty has thus emerged from the foregoing factors of path dependency, as such has inevitably led to misallocation of resources and the continuous subordination of people under authoritarian and corrupt rulers. Lack of empowerment among African people to push for development stands as both a consequence of poverty and a result of path dependency, both best understood through institutional analysis (Austin, 2008; Young, 1994).
The Nature of African Institutions
Investigating the reason behind the lingering problem of poverty in Africa requires a further evaluation of its history. Investigating whether Africa has experienced poverty consistently even before the modern period is an inquiry one ought to consider as part of a historical comparative analysis comparing the continent with the rest of the world. Knowing whether Africa has been poor compared to other continents even prior to the modern times is a noteworthy question that brings forth questions on the historical background of its institutions. A closer look at the history of Africa reveals that there have been developed civilizations in the continent that flourished mostly during the medieval period, their development touted as being on the same level as their counterparts in Europe and Asia (Acemoglu et al., 2005a; Austin, 2008).
Although there is little information on pre-modern measurements of development during the medieval period, there is an understanding that Africa fared poorly from the rest of the world in terms of technological innovations. In fact, evidence points to the premise that the wheel has not found extensive usage within any African society, alongside the fact that land plowing and writing did not prevail in any part of Africa. Such has downplayed the progress of Africa in terms of establishing political and economic institutions conducive for development. Centralization did not emerge in its consolidated form in Africa prior to colonization by European powers, yet the path dependency of the continent led to the rise of authoritarianism and stunted economic growth within its nations. The experience of Africa on slavery and colonization led its nations to pursue a path dependent direction limited to ironfisted yet inefficient ways of ruling (Acemoglu et al., 2005a; Austin, 2008).
The Colonial Experience
Comparatively speaking, Europe underwent different experiences in reaching economic development. Western Europe, where many of the powerful nations have historically resided, were once absolutist and patrimonial in nature. Yet, instrumental to the removal of archaic institutional features of European powers was the Glorious Revolution that happened in 1688. Remarkably, there was no similar event that took place in Africa, which explains part of the reason why its institutions arising from centralization were mostly authoritarian, corrupt and economically incompetent by nature. One could trace the relatively backward position of Africa throughout the 1500s from the fact that exploitation took place in the continent through the slave trade facilitated by European colonizers of the Americas, henceforth denying it from having any constructive involvement in the development of its institutions. The fact that people in Africa passed off as commodities led the continent to further disrepair, in turn denying it of any opportunities to partake in the institutional developments happening to European powers that time (Acemoglu et al., 2005a; Austin, 2008).
Worse, then, was the arrival of European colonizers on the shores of Africa. Beginning in the 19th century, European powers discovered that Africa is a haven for natural resources exploitable for the purpose of industrialization. When European powers started to establish colonies in Africa through a divide and conquer approach, modern economic development transpired not through endogenous measures, but through patronage politics and authoritarianism reminiscent of colonial rule. Given that the European powers have divided Africa based on their one-sided agreements, not through demographic considerations, many African tribes and native populations reeled in the reality of displacement from their homelands. Furthermore, whereas Africans sought to relent from the destructive actions of colonizers, the fact that they do not possess superior military arsenal at par with those possessed by Europeans left many of them dead and defenseless. The wholesale exploitation of Africans during the colonial era that transpired between the 19th and 20th centuries left them without any choice but to develop path-dependent institutions, which has since led them to another chapter of peril (Austin, 2008; Herbst, 2000).
Path Dependency towards Authoritarianism and Corruption
Path dependency has since plagued the nature of institutions in Africa, thus leaving the continent in a crisis-ridden state following the end of colonial rule in the continent. Following the independence of several African nations, Africa remained poor throughout the 20th century – a reality that still prevails at present and remains unsolvable. Post-colonial elements have since prevented Africa from ever moving on towards further development in its institutions. The despotic rule of authoritarian rulers emerged from the severe experiences African nations went through during the colonial period. Exploitation and displacement of people from their tribes and traditional habitats through the divide-and-conquer approach of European powers in colonizing Africa resorted to the rise of internal conflicts within African nations, with many of those still in continuation to this day (Herbst, 2000; Lipton, 1979).
Moreover, the continuing interference of former colonial masters, most notably France, has led African nations reaching development using present institutions in vain. Exploitation of natural resources, particularly oil and minerals, by France and other former colonial masters pushed through in exchange of constant military intervention needed to impose security over turbulent affairs in Africa. Path dependency, which has created authoritarian yet corrupt political leaders in Africa, has resulted to the misallocation of foreign aid coming from the UN, IMF, World Bank and other agencies such as USAID. With the harmful effects of resource exploitation and corruption as stated in the foregoing, Africa presently continues its institutional cycle of poverty (Herbst, 2000; Lipton, 1979).
Overall, African nations became highly inefficient in terms of producing people with capabilities to save and invest their income wisely and politicians with earnest integrity in fulfilling their responsibilities as providers of public goods. Path dependency, in general, is a reality many African nations have struggled to move on from, although such may probably take some time before producing favorable results in terms of institutional development (Herbst, 2000; Lipton, 1979).
Conclusion
There could possibly be no other straightforward answer to the question of poverty in Africa, other than the premise that its institutional development has went through a highly unstable process of path dependency, which in turn has emerged from its turbulent history and has since bred authoritarianism and corruption. Granted that Africa has went through an unfortunate past characterized by slavery, colonization and oppressive regimes, it is important to consider the contemporary circumstances surrounding the continent that may prove instrumental to its institutional development away from poverty. With that, it is important to establish the assumption that Africa is not bound to remain poor in the coming years, although such transformation is admittedly difficult to achieve. Globalization thoroughly fits within the institutional analysis approach of this study as a compelling influence to any changes in the fortunes of Africa. International organizations such as the UN, IMF, World Bank and similar agencies all play key roles to assisting Africa towards developing institutions away from path dependency and towards utilization of endogenous measures. Constant improvements in technology also pose valuable contributions to Africa as it moves against authoritarian regimes and corrupt government practices. At this point, however, manifestations of material progress in terms of institutional development in African have yet to emerge, given that said transformation requires adequate amounts of time for significant transformation to materialize. Therefore, instigating future studies serving as developments to the subject matter of this study is highly recommendable, given that such may contribute to the enrichment of the existing literature.
Recommendations
Policymakers must focus on the long-term goal of democratization by instituting policies promoting and improving the handling of elections in African nations. Given that path dependency has led Africa towards authoritarianism and corruption, it is important for policymakers to improve democratic foundations in African nations in order to aid their development smoothly. Transparency and accountability, both guaranteed by democracy, is necessary to protect foreign aid entering Africa from the clutches of corruption and preserve the resources of the continent from exploitation by former colonial masters. Thus, while there is an understanding that a quick transition to full democracy is impossible, policymakers must first entertain reforms improving transparency and accountability in African nations. Checks and balances, being practically absent under authoritarianism, may benefit African nations as they undergo democratization. Cooperation with foreign aid agencies such as the UN, IMF, World Bank and others must intertwine with endogenous developmental efforts in order to propagate development in Africa smoothly. Recognizing that reliance on foreign aid agencies, many of which being Western in nature, may not result to development in Africa without the involvement of endogenous developmental efforts.
References
Acemoglu, D., Johnson, S., & Robinson, J. (2005a). The rise of Europe: Atlantic trade, institutional change and economic growth. American Economic Review, 95, 546-579.
Austin, G. (2008). Resources, techniques, and strategies south of the Sahara: Re-visiting the factor endowments perspective on African economic development, 1500-2000. Economic History Review, 61, 587-624.
Herbst, J. (2000). States and power in Africa. Princeton, NJ: Princeton University Press.
Lipton, M. (1979). Why poor people stay poor: Urban bias in world development. Cambridge, MA: Harvard University Press.
Young, C. (1994). The African colonial state in comparative perspective. New Haven, CT: Yale University Press.
