Economic Growth and Development

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Kenya, 36.0 per cent in Uganda, 31.7 per cent in Rwanda, 27.0 per cent in
Vietnam and 20.9 per cent in Malawi (Docquier and Rapoport, 2011:7). It is
interesting to note that these countries are a mix of the failing economically
(Haiti), post-conflict (Sierra Leone and Rwanda) and those experiencing rapid
economic growth (Uganda, Vietnam). Particularly affected is the medical sector
in Sub-Saharan Africa where 20 per cent of medical professionals have
emigrated, and in a survey of six African countries in 2003, 50 per cent of
medical professionals still resident declared they were considering migration
(2011:37). Critics have argued that this brain drain deprives developing coun-
tries of the skills necessary to produce and deliver services. Others have argued
that skilled workers send home remittances. For example, in 2002 Pakistan,
Uganda, Morocco, Guatemala and Sri Lanka all received more than 8 per cent
of GDP in remittance income and all have notably high shares of skilled migra-
tion. Others have argued that skilled migrants will acquire more skills, education
and savings and often return home and so become ‘brain gain’. There is some
evidence of this latter effect in India,though in a typical year outward migration
of Indian professionals on the H1B visa is thirty times the number returning.


Key points



  • Colonialism has influenced growth at a proximate level through policies
    relating to investment, education and land during the colonial era.

  • Colonialism has also influenced growth in the post-independence era
    through the deeper determinants: institutions (importing them from the
    coloniser or maintaining indigenous institutions); geography (drawing
    borders); culture (ethnic divisions); and openness (typically exposing the
    colony to trade and openness with the colonizer at the cost of trade and
    openness with the rest of the world).

  • The nature of colonialism was in some cases influenced by the nature of the
    colony. The Acemoglu thesis suggests the disease environment influenced
    the choice of whether the colonial state would set up extractive or settler-
    type institutions.

  • India was not a settler state but the British did try to replicate aspects of
    ‘good institutions’ alongside extraction for their own benefit.

  • The British in Nigeria and Kashmir were really an absent state, neither
    settler nor extractive.

  • The Japanese settled in South Korea in order to more efficiently ‘extract’,
    but many argue that these extractive institutions were later turned by the
    independent government of South Korea into a means to promote rapid
    growth and development.

  • There is a rich debate on colonialism from a Marxist perspective.

  • There are various thematic debates about the impact of colonialism on
    development in the colonies; these themes are the drain of surplus, deindus-
    trialization,diversity and isolation, and human development.


204 Patterns and Determinants of Economic Growth

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