Political Distortions, State Capture, and Economic Development in Africa
Journal of Economic Perspectives
vol. 36,
no. 1, Winter 2022
(pp. 101-24)
(Complimentary)
Abstract
This article studies the role of political distortions in driving economic growth and development in Africa. We first discuss how existing theories based on long-run structural factors (e.g., pre-colonial and colonial institutions, or ethnic diversity) may not capture new data patterns in the region, including changes to political regimes, growth patterns, and their variation across regions with similar historical experiences. We then argue that a framework focused on political distortions (i.e., how political incentives impact resource allocation and economic outcomes) may have multiple benefits: it encapsulates many distortions observed in practice, including patronage, variations in contract enforcement and the role of political connections in firm outcomes; it unifies results in Africa and elsewhere; and it leaves a wide scope for policy analysis. We conclude by overviewing reforms that may curb such distortions, including changes to campaign financing rules, bureaucratic reform, free trade agreements, and technology.Citation
Canen, Nathan, and Leonard Wantchekon. 2022. "Political Distortions, State Capture, and Economic Development in Africa." Journal of Economic Perspectives, 36 (1): 101-24. DOI: 10.1257/jep.36.1.101Additional Materials
JEL Classification
- D72 Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- D73 Bureaucracy; Administrative Processes in Public Organizations; Corruption
- E23 Macroeconomics: Production
- F15 Economic Integration
- O17 Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
- O30 Innovation; Research and Development; Technological Change; Intellectual Property Rights: General
- O43 Institutions and Growth
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