The Origins of Colonial Investments in Former British and French Africa

Abstract

Colonial investments impacted long-run political and economic development, but we have little systematic evidence about their origins and spatial distribution. Combining novel data sources, I show that colonial investments were very unequally distributed within 16 British and French African colonies. What led colonial states to invest much more in some districts than others? I argue that natural harbors and capes led some places to become centers of pre-colonial coastal trade, which in turn increased later colonial investments not only in infrastructure but also in health and education. Furthermore, distance from pre-colonial trading posts helps explain the diffusion of investments within each colony. I find limited support for alternative explanations such as natural resources and pre-colonial ethnic characteristics, including pre-colonial political centralization. These two findings suggest an economic origin for the regional and ethnic disparities that we observe in the colonial and contemporary periods.