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The great divergence in South Africa: Population and wealth dynamics over two centuries

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  • Fintel, Dieter von
  • Fourie, Johan
Abstract
Does wealth persist over time, despite the disruptions of historical shocks like colonisation? This paper shows that South Africa experienced a reversal of fortunes after the arrival of European settlers in the eastern half of the country. Yet this was not because of an institutional reversal. We argue, instead, that black South Africans found themselves at the mercy of two extractive regimes: one in ‘white South Africa’ and another in the ‘homelands’. The political and economic institutions of each of those regimes favoured a small elite: in white South Africa, whites, and in the homelands, the black chiefs and headmen. Democracy brought inclusive institutions for black residents in white South Africa but not for those in the former homelands. This is why we see mass migration to the urban areas of South Africa today, and why addressing the institutional weaknesses of the former homelands are key to alleviating the poverty in these regions where a third of South Africans still reside.

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  • Fintel, Dieter von & Fourie, Johan, 2019. "The great divergence in South Africa: Population and wealth dynamics over two centuries," Journal of Comparative Economics, Elsevier, vol. 47(4), pages 759-773.
    • Handle: RePEc:eee:jcecon:v:47:y:2019:i:4:p:759-773
    DOI: 10.1016/j.jce.2019.08.005
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    2. Johan Fourie, 2020. "The settlers of South Africa and the expanding frontier," Working Papers 14/2020, Stellenbosch University, Department of Economics.
    3. Bridgman, Grace & von Fintel, Dieter, 2022. "Stunting, double orphanhood and unequal access to public services in democratic South Africa," Economics & Human Biology, Elsevier, vol. 44(C).
    4. Leonard Le Roux & Johanna Choumert-Nkolo, 2023. "Internal Migration and Energy Poverty," Working Papers 2023.01, FAERE - French Association of Environmental and Resource Economists.
    5. Abel Gwaindepi & Johan Fourie, 2020. "Public Sector Growth in the British Cape Colony: Evidence From New Data on Expenditure and Foreign Debt, 1830‐1910," South African Journal of Economics, Economic Society of South Africa, vol. 88(3), pages 341-367, September.
    6. João Lourenço Marques & Jan Wolf & Fillipe Feitosa, 2021. "Accessibility to primary schools in Portugal: a case of spatial inequity?," Regional Science Policy & Practice, Wiley Blackwell, vol. 13(3), pages 693-707, June.
    7. Daniel de Kadt & Johan Fourie & Jan Greyling & Elie Murard & Johannes Norling, 2020. "The causes and consequences of the 1918 influenza in South Africa," Working Papers 12/2020, Stellenbosch University, Department of Economics.
    8. Santos Bila & Mduduzi Biyase, 2022. "Determinants of Subjective Poverty in Rural and Urban Areas of South Africa," Economics Working Papers edwrg-02-2022, College of Business and Economics, University of Johannesburg, South Africa, revised 2022.

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    More about this item

    Keywords

    Reversal of fortunes; Population persistence; Institutional reversal; Colonial impact; Settler economy; African economic history; Traditional leaders;
    All these keywords.

    JEL classification:

    • N97 - Economic History - - Regional and Urban History - - - Africa; Oceania
    • N37 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Africa; Oceania
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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