Indirect Rule, Cash Crop Production, and Development in Africa


Colonial governance in Africa varied considerably in its extent of indirect rule through precolonial institutions. Assessing the developmental consequences of indirect rule, this paper argues that it strengthened populations’ bargaining power and increased public service provision in return for taxation of agricultural produce, in particular cash crops. To test this argument, I exploit variation in the indirectness of colonial rule – whereas British indirect rule increased in the centralization of precolonial institutions, the French implemented more uniform direct rule. I furthermore measure public service provision with geo-referenced education outcomes of individuals born and raised under colonial rule and use soils’ suitability for cash crop production as an exogenous proxy for real production. Supporting the theoretical claim, the effect of cash crop suitability on primary education increases with precolonial centralization in former British colonies, but not in French ones. Comparisons of education rates in neighboring ethnic groups with different levels of centralization and ethnic groups cut by British-French boundaries reaffirm this result. Contemporary development outcomes show patterns consistent with persistent effects of indirect rule in cash crop producing areas. The findings underscore the joint importance of political institutions and resource endowments in determining local development.