Malaria: Root Causes of African Underdevelopment

Here is another case of confirmation bias — at least it confirms my bias on malaria and economic development. Sambit Bhattacharyya at The Australian National University has a new paper forthcoming in the Journal of African Economies [PDF]. From the Abstract:

What are the root causes of Africa’s current state of under-development? Is it the long history of slave trade, or the legacy of extractive colonial institutions, or the fallout of malaria? We investigate the relative contributions of these factors using Atlantic distance, Indian Ocean distance, Saharan distance, Red Sea distance, log settler mortality, and malaria ecology as instruments. The results show that malaria matters the most and all other factors are statistically insignificant. Malaria also negatively affects savings. The results are robust even when the malaria ecology instrument is replaced by frost, humidity, and rainfall and when the latter are used as additional control variables. We find that frost alone is enough to knock off the effects of slave trade and institutions on long term development in Africa.

From the Introduction:

It is well known that Africa is falling behind the rest of the world in terms of economic wellbeing. Even though global poverty is on the decline due to rapid economic growth in India, China, and other parts of the world, Africa’s contribution to this decline is disappointing. Absolute poverty in many of the African nations is in fact rising (Sachs, 2005). What is the fundamental cause behind this decline? This has been a topic of research for a few decades now. Even though it is extremely difficult to summarize this voluminous literature, it is perhaps fair to say that three strands of thoughts stand out. The first is the disease view. According to this view, malaria and other infectious diseases have fatal as well as debilitating effects on the human population in Africa. It negatively influences productivity, savings, and investments in physical and human capital and directly affects economic performance of the continent (Gallup and Sachs 2001; Bloom and Sachs 1998). According to Bloom and Sachs (1998), the high incidence of malaria in sub-Saharan Africa reduces the annual growth rate of the continent by 1.3 percentage points a year and eradication of malaria in the 1950s would have resulted into a doubling of per capita income.