Reversal in Africa

Abstract

Acemoglu, Johnson, and Robinson (2002) document a 'Reversal of Fortune' among former European colonies. Former colonies that were relatively advanced in 1500, measured by urbanization rates and population density, are comparatively poor today. Although, when using population density data, they include sub-Saharan Africa in the sample, it is not examined in isolation. The contribution of this paper is to explore, focusing solely on sub-Saharan Africa, whether estimates of initial population density in 1500 are correlated with economic outcomes today. It is found that population density in 1500 is strongly negatively correlated with current GDP per capita, even after controlling for latitude, ethnolinguistic fractionalization, fraction of current population of European descent, identity of colonizing power, and whether a country is landlocked or not. The robustness of these results to dropping various countries from the sample, such as the island nations and countries in southern Africa, is also tested. In addition, two possible channels are examined through which population density in 1500 could affect income today: institutional quality and human capital. These findings highlight one historical factor that helps explain current income variation within sub-Saharan Africa.