‘A valuable corrective to the fraying narrative of [African] failure.’ Foreign Affairs
Not so long ago, Africa was being described as the hopeless continent. Recently, though, talk has turned to Africa rising, with enthusiastic voices exclaiming the potential for economic growth across many of its countries.
What, then, is the truth behind Africa’s growth, or lack of it?
In this provocative book, Morten Jerven fundamentally reframes the debate, challenging mainstream accounts of African economic history. Whilst for the past two decades experts have focused on explaining why there has been a ‘chronic failure of growth’ in Africa, Jerven shows that most African economies have been growing at a rapid pace since the mid nineties. In addition, African economies grew rapidly in the fifties, the sixties, and even into the seventies. Thus, African states were dismissed as incapable of development based largely on observations made during the 1980s and early 1990s. The result has been misguided analysis, and few practical lessons learned.
This is an essential account of the real impact economic growth has had on Africa, and what it means for the continent’s future.
Jerven overall makes some good points but the book seems a bit lost in past debates.
1. Cross-country regressions are bad, agreed. We can only learn a minimal amount from these. That's why it's good these things are basically laughed out of seminars now. 2. It's interesting & fair for Jerven to point out that African economies HAVE experienced growth, it just hasn't been consistent & was quite low for about two decades in the 70s/80s. 3. ...the above is a biiiiit contradicted by his (fair) insistence that African GDP statistics suffer from poor numbers. How do we really know there was growth not just some wild overestimation for one decade? 4. His qualitative narrative about individual countries actually really does point to a low-growth narrative (despite his critique that "average growth" obscures a lot of nuance). He mostly describes economies that were boosted on high commodities prices that predictably experienced crashes when demand for those commodities fell. That... really looks to be a case well-described by low average growth rather than periods of growth and collapse (since the "growth" was really just "growth" in commodities prices). 5. He makes a couple of interesting points about the more modern type of development economic history. Most interestingly, he notes that since countries experience a lot of fluctuations, perhaps even an econometrically well-identified study might show a certain effect e.g. in 2000 but a different one in 1960 since so much has changed there. That's a fairly interesting point... but we don't know if it's true and unfortunately MJ uses this argument to completely dismiss this type of work. Like, while this could happen in principle it's equally possible that these well-identified studies would show more or less the same effect in 1960 as in 2000 which would negate his argument. He hints at justified critiques of more questionable cross-country historical work (e.g. AJR settler mortality) namely that there's no reason to believe the exclusion restriction, but spends a lot of time on extraneous critiques. It may be true, e.g., that some institutions are more appropriate at different times or for different countries or that good governance is a development outcome not vice versa, but these are stated and never really argued given how monumental this claims are (they are Big Questions within the field). 5b. MJ also largely seems to ignore historical work that IS from country case studies, eg work by Melissa Dell or Nathan Nunn. Convenient, as he would have to admit a lot of his advice has already been taken in the field. 6. It's a little hard to see what MJ's preferred path forward is. It would not be cross-country and would probably involve some country-specific case studies being paired with some basic GDP statistics or similar proxies. That's good stuff & definitely fills a gap, but it's hard to go very far with that. The Big Questions (why are some countries less developed) are very important even if MJ would prefer other ones be asked (though he doesn't exactly spell out why there is more "low-hanging fruit" or what it is, exactly). This bit is also confusing since a lot of MJ's own work uses the same GDP statistics he (rightly) criticizes to make various points, leading to a bit of a contradictory message (e.g. see my point #3 above).
Overall, the work is most coherently critical about work that is no longer in vogue in the field and less coherently critical about the rest. It was an edifying read, but one that could have been better if more tapped into the recent literature.
I really like Jerven's previous book Poor Numbers which is why I read this one too. What is particularly interesting about this book, is that Jerven takes a part many of the seminal development economics papers on Africa, that I too have read and studied through my time as economist. Furthermore, he does not hold back his criticism of many famous development economists, some of whom I work with too. I think he provides a very interesting perspective on the interpretations that are being made on the African growth story and where we may be collectively getting it wrong. However, the reason that this not receive a 5 star rating from me is that it is missing the "so what next?" part which I think is important. If our current techniques, from the economists' perspective, do not work well, and as he argues in this book but more strongly in Poor Numbers, we have issues with the data , what do we do?
This book is fascinating, not just for what it says about African economies, but for what it tells us about misuse of statistics and the danger of empirical analysis by those far from the reality on the ground. By questioning of Western economists' ability to break out of paradigms that reinforce their own stereotypes about Africa, it also subtly reinforces the need for decolonization of academia. Well worth the read.
- I really liked this book, its short and sweet at 140ish pages and Morten Jerven does a good job breaking down how economists and institutions get it all wrong with Africa.
- Jerven breaks down some of the crazy shortcomings of the economic narrative about Africa. From academics publishing papers with poor quality data, to the fact that a lot of data isn’t available to back up the claims of many.
- Jerven takes aim at the methodology used to interpret the data among other things. It’s a really good book.
‘… the African GDP per capita in 1960 was about one-sixth of world GDP per capita. This remained true until 1977, after which the gap widened, and by 2000 the African GDP per capita was less than one-tenth of world GDP per capita.’
‘According to John Kenneth Galbraith, the only function of economic forecasting is to make astrology look respectable.’
‘Quite a bit of the recent economic growth in Africa is not grounded in observed or recorded change but rather is simply based on an assumption. Because there is some growth in the formally recorded sector, accountants assume that growth in the informal sector is also increasing, and they adjust the GDP estimates to capture growth in those unrecorded areas.’
‘In 2010, national statisticians recalculated Ghana’s GDP using new data sources to create a benchmark for 2006… It turned out that in the years between 1993 and 2006, almost half of Ghana’s economy was not accounted for in the national statistical accounts.’
‘It is symptomatic of the state of knowledge on African statistics that two key players, the IMF and the African Development Bank, published conflicting metadata within a month of each other.’
‘The evidence shows that the so-called traps are escapable and the so-called curses are not destiny.’
Africa : Why Economists Get it Wrong (2015) by Morten Jerven is a very interesting book on how economists have misused dubious statistics on Africa and erroneously constructed a narrative on how African development has failed. Books on Africa such as Paul Collier's The Bottom Billion and William Easterly's The Elusive Quest for Growth are built on very shaky foundations according to Jerven. Jerven is an economic historian with a PhD from the LSE and wrote the highly acclaimed book Wrong Numbers that seems to cover much of the ground that this book does. Jerven describes how economic growth is misunderstood because good African statistics often start in 1960 and are not very strong and because low commodity prices and other factors, possibly HIV and some very poor governments led Africa to have low growth in the 1980s and the 1990s which was then declared as normal despite it effectively being two poor decades. The book also makes the point that if growth from 1960 to 1990 is divided into two 15 year sections Africa does fairly well in each, only huge growth in the 1975 to 1990 era by South and East Asia making Africa not look particularly good. It's curious here that for a book written in 2015 that the statistics stop in 1990. Jerven then looks at how poor statistics are compressed and combined to present a picture of poor growth in Africa in the pre-colonial era. This also includes some asides into how The Economist and other news magazines have declared Africa lost and then doing well in the space of two or three years. He also points out how a number of the explanations for growth successes may be post fact rationalizations. The idea that growth and wealth might bring in good institutions rather than the other way around is very interesting. The book also describes the big problems with modern African statistics in more detail. Due to low populations, low wealth and statistical tools designed to measure wealthy countries economies the accuracy of African statistics is very questionable. A number of African states have errors that are huge, in the order of 1/3 or more of the GDP per capita when comparing across different statistical agencies. This indicates huge inconsistencies and problems. Also rebasing is not done frequently enough and when it is done tends to have such a big effect that it overshadows actual economic changes. The book concludes that poor numbers and dubious explanations have combined to create poor economic studies of Africa. The differences within Africa and the relative lack of wealth may have caused economists to make considerable errors. Jerven asserts that there is no Bottom Billion and that development stories have been driven by narrative fallacies based on quicksand. It's a really interesting idea and even if wrong the book is definitely worth reading.
If I have to summarise it i would say - Nothing is as straightforward as it seems ! And something even the trained eyes who are out there searching and researching the solutions overlook. And my way, is the correct way approach will often lead to disaster.
This is more like reading a thesis. But a very well written thesis.
Maybe the author could have come up with a different title to get more audience, but one thing is for sure, its a very easy read. And I think even people who have no economics background will not only understand the content, but also enjoy it and definitely come out more informed after the book.
Although far from a holiday read, but this can be your next non-fiction read if you ever want to pick one up for your next holiday other than fiction. Recomendation - Take your time with this one !
Africa: Why Economists Get It Wrong is certainly not written in the same easy-reading best-seller style as other development economics titles (Eg. Collier, Sachs, Moyo, et al). It reads as though it is directed at specialists and fellow academics, rather than a mainstream audience, as it's full of datasets, statistical analysis, and economic jargon (not to mention Jerven's polemical tone towards development economists (in particular, Collier and Acemoglu)). However, Jerven certainly fills a void in the literature with his novel approach to the economic history of Africa.
The book provides a history of African development economics through critical examination of the contemporary role of statistical and econometric methods in policy debate on Africa. Primarily it criticises flawed models and evidence that have framed Africa as chronically failing, which "conveniently circumvented some of the difficult questions for the orthodox economic literature. How can we explain that so called 'bad’ economic policies in the 1960s and 1970s coincided with good economic performance, whereas the introduction of 'good’ economic policies and political governance in the 1980s and 1990s is correlated with economic stagnation and political turmoil? This economic analysis gave support to the liberal policy package enforced in the 1980s and 1990s [Washington Consensus], but the economic record shows that growth only returned when world economic conditions improved in the late 1990s."
If you have read Collier, Easterly, Sachs, Moyo, Acemoglu, et al. then this book is really compulsory reading.
As someone without a formal background in economics, this book was very helpful in breaking down some of the jargon I tend to gloss over. Jerven's main point is that instead of asking why Africa is developing slowly (which he proves lacks nuance and is cherry-picked), we should instead ask how Africa is developing. The former is a self-fulfilling prophecy that leads to normative studies and models whereas the ladder is open-ended.
Fuck this book is good. More than just for development economists, this is a book which should be read by all economists, as Jerven's critique of overly ahistorical and econometric approaches to African economic development is one which should be better heeded by macroeconomists more generally.
Ah. Economists are at each other’s throats again. It chills you to think the discipline not much younger than science is still fraught with quarrels on the fundamental level. But this time, the unknown challenger has a point.
Morten Jerven, a LSE grad and professor in Norway, challenged two popular views about Africa. The Bottom Billion: the faint impression that their economic failure in the last century was a postcolonial consequence, and the Rising Africa: the positive outlook given the recent spurts of growth. Conflicting as they might be and confusing they surely were to, Jerven was finding their common error and reiterating the same old point that misleading statistics have misled statisticians.
The cut-off time between the two perceptions lies in the naughties. Before that, sub-Saharan countries were generally considered a patient of the paradox of plenty dogged by postcolonial inefficiencies. Jerven emphatically rejected this impression, citing the countervailing boom before the 1960s. Some of the best-selling institutionalists were clearly not diligent enough, who had carried out cross-country regressions with problematic variables, well summarised in chapter one. A robust model can only carry you so far. Yet the truism is there: garbage in, garbage out.
I love that he had consulted broadly and made some constructive literature comparisons. Usually people cherry-pick their sources without genuinely understanding them. In the grand rebuttal of things, his primary duty was to get his message across. So when you’re citing to disagree, you go to extra lengths to show the readers which part is good and which part is not. His quasi-literature review on African economies, admittedly rare for a bibliography, is useful.
Writing in his green years as a PhD, he committed minor contradictions. He set out to disagree with Acemoglu and Robinson, I quote, ‘[Whose] argument that a governance shortfall in Africa can be linked to poor economic performance has probably been overstated.’ Just when I thought he was giving up path dependency and therefore democracy, he recommended towards the end that African countries ‘democratise’ and improve institutions. He punctured the rosy picture he’d been painting. But given his fatal blow to the lazy ‘reg monkeys’ throughout the book, I’d give him that.
Overall, a good critique of how the field of economics has approached the analysis of African economies. What I find sorely lacking however is that Jerven is extremely thin on what an alternative approach looks like.
Really enjoyed this book as it changed my views on previous economic work I believed. Essentially Jerven skewers a number of economists for presenting misleading theories which lead to sub-optimal policies. The problem with Africa has been growth then contraction. Secondly this isn't all to do with institutions rather poor growth leads to institutions and finally the data isn't great
This entire review has been hidden because of spoilers.
I feel like this book is mistitled. This is more a scholarly document than a book. The author lays out his arguments thoroughly, with great attention to detail. I understand his arguments since I've taken PhD-level coursework in economics, but others might not be so interested. Unfortunately, the material never seems to rise up to give a more trenchant critique of the problems in economics that Jerven identifies. The discipline of economics has a lot of problems, in part because it's not independent from politics even though it pretends to be. Also, IMO there is an overreliance on regression as a way to establish arguments. All of this is to say that Jerven answers the question of "how" economists got it wrong through their assumptions, equations, and math, rather than "why" --- which to me would be a much more interesting book.
The author is postulating a lot of criticism on the way economists are judging the development in Africa (sic!). In the second step it is tried to explain the the stipulated errors by simplifying the underlying assumptions/models. The third part of the book is trying to, yes and that is where I got lost in reading the aim is to produce different ideas but they are brought forward on the basis of the very simplifyed theories that leave, at least from my perspective, a lot to be desired.
Africa consists of about 54 countries meaning 54 different development pahts based on their history and the different approaches that are being taken should be taken into consideration.
Many points with which I agree. Context matters. A lot of the underlying data points used leave much to be desired. Don't take 'Africa' as a 'collection of homogenous experiences'. More transactions alone do not readily equate to higher standards of living. Volatile growth paths do not necessarily lend themselves to the best development outcomes.
So why only three stars? Because the key point is still poor data, and I think we need to start making an effort to move on from that. I look forward to the next book, that will hopefully take the analysis a little further still.