Marlous van Waijenburg

Sub-Saharan Africa’s recent economic boom has raised hopes and expectations to lift the regions’ ‘bottom millions’ out of poverty by 2030. How realistic is that goal? We approach this question by comparing the experiences of three front-runners of region-specific development trajectories – Britain’s capital-intensive, Japan’s labour-intensive, and Ghana’s land-extensive growth path, highlighting some historical analogies that are relevant for Africa, but often overlooked in the current ‘Africa rising’ debate. We draw particular attention to Africa’s demographic boom and the possibilities for a quick transition to labour-intensive export-led industrialization. Although our exercise in diachronic comparative history offers little hope for poverty eradication by 2030, we do see broadened opportunities for sustained African economic growth in the longer term.

Dominant theories of state formation and nation-building lean heavily on the classic European tale of the simultaneous development of a ‘fiscal state’ and a ‘nation state’. The main idea is that fiscal reform, including the adoption of modern taxes such as direct income taxes, was part and parcel of a larger process to strengthen the central state, both internally and externally. This process also involved the idea of a ‘social contract’ between the state and its tax-paying citizens, in the sense that revenues were mobilized to promote public goods, and that there was ‘no taxation without (limited) representation’.

However, this Euro-centered narrative does not factor in that more than two-thirds of the world embarked on a path towards fiscal ‘modernization’ under colonial rule. Contrary to sovereign states, these countries were controlled by a foreign satellite government, and ideas of nationhood were either non-existent, weakly developed, or emerged exactly in opposition against the obligation to pay tribute to external rulers. This difference between the experience of sovereign and colonial states forces us to rethink the rationale and practice of fiscal modernization in large parts of the world.

We argue that while the introduction of modern taxes in the colonies followed pretty quickly after they had been implemented in the main European metropoles, there are four major ways in which the logic of colonial fiscal development (c. 1820-1970) was at odds with the European experience. First, ‘modern’ taxes came about without a complementary development of accountable government. Second, they were introduced absent independent military and monetary regimes. Third, welfare provision and the development of bureaucratic capacity remained modest in most colonies, certainly when compared to the standards enjoyed in the metropoles. Finally, these new taxes did not apply equally to all colonial inhabitants or companies. In contrast to the imperial metropoles, where 'modern' taxes built on organically grown tax bases, fiscal 'modernity' and 'tradition' co-existed in a dualistic system in the colonies. In short, the adoption of ‘modern’ taxes was not necessarily part of a wider process of fiscal ‘modernization’. The comparison of fiscal development under colonial and sovereign rule helps to move beyond the Eurocentric bias in the historical tax literature and develop a more global theory of fiscal modernization.

This paper presents the hitherto largest historical dataset of skill-premiums for Sub-Saharan Africa and Southern and Eastern Asia, tracing long-term trends in relative prices of labor skills back from the 1870s up to the early 21^st century. Our series reveal three new stylized facts that so far have gone unnoticed in the development literature. First, we show that skilled artisanal and white-collar labor tended to be far more expensive in Africa and Asia on the eve of the global schooling revolution than it had been in pre-industrial Europe. Second, our series reveal that the relative price of skills was on average much higher in Africa than in Asia. Finally, we document a dramatic free-fall in skill-premiums during the 20^th century in both regions, ultimately converging to levels long witnessed in the early industrializers. While the timing and intensity of the decline in skill-premiums varied from place to place, the free-fall was universal. We explore why the relative price for skilled workers around 1900 were so much higher in Africa than in Asia and why these price gaps converged so rapidly in the course of the 20^th century.

Professor van Waijenburg’s research focuses on the historical roots of relative African poverty and state fragility. Where sufficiently reliable and comparable records exist, she creates new datasets from a range of qualitative and quantitative archival sources. The construction of economic indicators for periods where standardized data for Africa is generally lacking (usually pre-1960), has three major cross-disciplinary payoffs. First, these new empirical foundations allow us to scrutinize a number of deep-seated (mis)conceptions about Africa’s political and economic past. Second, data over longer time periods can reveal a number of slower moving changes that have taken place in African economies. And finally, such historical datasets better embed ‘Africa’s path’ in debates about the making of global economic inequality.

Her first book (in progress) analyzes the comparative nature and pace of colonial state-building efforts in Africa through the lens of taxation. Drawing on extensive archival work in Aix-en-Provence, Dakar, London, and Washington D.C., she constructed a public finance dataset that is comparable across time and space for nearly 30 British and French African colonies. This macro-perspective allows her to scrutinize contradicting narratives about colonial fiscal ambitions, to identify similarities and differences in colonizers’ strategies to fiscal and state capacity building, and to measure and explain the incidence of widely varying tax-payer burdens across colonial Africa. Most importantly, her analysis incorporates the “invisible” component of colonial public finance: the in-kind revenues that accrued to the state from forced labor practices. This dimension sets her study apart from an expanding and cross-disciplinary body of literature on historical tax systems. By approaching forced labor from a fiscal perspective, she not only seeks to broaden the conceptual framework of the historical ‘fiscal capacity building’ literature, but also to shed new light on the multifaceted role of colonial labor coercion practices.