Economic Disasters of the Twentieth Century

Economic Disasters of the Twentieth Century

Edited by Michael J. Oliver and Derek H. Aldcroft

The First and Second World Wars, the great depression, oil shocks, inflation, financial crises, stock market crashes, the collapse of the Soviet command economy and Third World disasters are discussed in this comprehensive book. The contributors subject these disasters to in-depth assessment, carefully considering their costs and impact on specific countries and regions, as well as assessing them in a global context. The book examines the legacy of economic disasters and asks whether economic disasters are avoidable or whether policymakers can learn from their mistakes.

Chapter 9: The Fatal Inversion: The African Growth Disaster

Derek H. Aldcroft

Subjects: economics and finance, economic psychology, financial economics and regulation, money and banking

Extract

1 Derek H. Aldcroft The wind of change is blowing through the African continent. Whether we like it or not, this growth of national consciousness is a political fact. (Harold Macmillan, Cape Town, South Africa, 3 February 1960) Disaster, tragedy, crisis, chaos: all words that have been used to describe the economic experience of Africa, especially Sub-Saharan Africa (SSA), since decolonization (see Ravenhill 1986; Onimode 1988; Ayittey 1998). ‘Africa’s economic history since 1960 fits the classical definition of tragedy: potential unfulfilled with disastrous consequences’ (Easterly and Levine 1997, 1203). Africa’s growth performance has been described as the largest economic disaster of the twentieth century (Artadi and Sala-i-Martin 2003, 18). And not without justification. Broadly speaking, there was very little material progress on average in the post-colonial period; per capita incomes were generally no better by the end of the twentieth century than they had been in the early 1960s, and in some cases they were a good deal worse. ‘For many Africans, conditions of life are scarcely better, and possibly worse, than they were when their colonial rulers departed’ (McCarthy 1990, 35). While poverty worldwide has declined over the past half century, the numbers living in poverty in Africa have skyrocketed. They now make up around one half the population of the African continent as a whole and the proportion is even higher in SSA. Furthermore, nearly one half of the world’s poor now live in Africa. This is indeed a remarkable state of affairs. At...

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