A colonial legacy? Income inequality in former British African colonies.

 
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24 April 2015

KEY FINDINGS

* All British African colonies displayed a high level of income inequality, roughly double that of the United Kingdom at the time of independence.

* Post-Second World War policy changes by the United Kingdom focused on the social and economic development of colonies; in many cases these reforms led to a decrease in inequality.

* Most colonies experienced a fall in top income shares following independence.

The presence of European colonial powers in Africa has left a long-lasting legacy that has severely impacted their development trajectories. But what are the lingering effects of colonization on economic performance, in particular with regard to inequality? While clear information on many economic sectors is often difficult to obtain, it is possible to utilize income tax records in former British African colonies to further examine income inequality during and after colonization.

Inequality levels at the end of colonialism

While individual colonial societies undoubtedly displayed a great deal of diverse characteristics there was a high level of income inequality in all. At the time of independence, the levels of inequality in the former colonies were around double the levels in the UK, France and other Western countries. In Uganda, Kenya, Tanzania, Zanzibar, Malawi, and Zimbabwe the share of the top 0.1% of income earners exceeded 4%. Historically, all of the British African colonies recorded high figures for the top income shares, reaching a high of 35% for the top 1% of taxpayers in Zimbabwe in 1950.

It must be noted, however, that colonial income distributions have not remained static over time. In Kenya, Tanzania and Zambia, for example, top income shares fell during the post-Second World War colonial period. In Zimbabwe, the share of the top 1% fell to 22% by 1964. These changes could be in part due to a policy shift in British colonial practices: post-war policies began to focus on greater partnerships with the colonies to improve social and economic development.

Colonial rulers initiated these partnerships following periods of unrest and the official acknowledgement that a great deal of poverty, disease and neglect persisted in many locations. This created a situation in which many colonies with considerable differences in top income shares experienced a marked convergence in the post-war years leading up to independence, albeit at a different pace in each location.

Over time, there were consistent falls...

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