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    An African Success Story: Botswana: Daron Acemoglu Simon Johnson James A. Robinson

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    Agang Nicole Bakwena
    The document summarizes two papers about Botswana's economic development: 1) Botswana achieved rapid economic growth despite adverse conditions by following orthodox economic policies enabled by strong institutions of private property. Diamonds provided wealth without challenging the political status quo, and leaders reinforced good institutions. 2) A later paper rejects viewing Botswana as a developmental state and instead argues it has a "development-oriented gate-keeping state" structure characterized by resource dependency, lack of diversification, and close elite connections, but still achieved significant socioeconomic development.

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    An African Success Story: Botswana: Daron Acemoglu Simon Johnson James A. Robinson

    Uploaded by

    Agang Nicole Bakwena
    34 views4 pages
    The document summarizes two papers about Botswana's economic development: 1) Botswana achieved rapid economic growth despite adverse conditions by following orthodox economic policies enabled by strong institutions of private property. Diamonds provided wealth without challenging the political status quo, and leaders reinforced good institutions. 2) A later paper rejects viewing Botswana as a developmental state and instead argues it has a "development-oriented gate-keeping state" structure characterized by resource dependency, lack of diversification, and close elite connections, but still achieved significant socioeconomic development.

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    An African Success Story

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    The document summarizes two papers about Botswana's economic development: 1) Botswana achieved rapid economic growth despite adverse conditions by following orthodox economic policies enabled by strong institutions of private property. Diamonds provided wealth without challenging the political status quo, and leaders reinforced good institutions. 2) A later paper rejects viewing Botswana as a developmental state and instead argues it has a "development-oriented gate-keeping state" structure characterized by resource dependency, lack of diversification, and close elite connections, but still achieved significant socioeconomic development.

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    © All Rights Reserved
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    34 views4 pages

    An African Success Story: Botswana: Daron Acemoglu Simon Johnson James A. Robinson

    Uploaded by

    Agang Nicole Bakwena
    The document summarizes two papers about Botswana's economic development: 1) Botswana achieved rapid economic growth despite adverse conditions by following orthodox economic policies enabled by strong institutions of private property. Diamonds provided wealth without challenging the political status quo, and leaders reinforced good institutions. 2) A later paper rejects viewing Botswana as a developmental state and instead argues it has a "development-oriented gate-keeping state" structure characterized by resource dependency, lack of diversification, and close elite connections, but still achieved significant socioeconomic development.

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    © All Rights Reserved
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    of 4

    An African Success Story: Botswana

    CEPR Discussion Paper No. 3219

    49 Pages Posted: 14 Mar 2002

    Daron Acemoglu
    Massachusetts Institute of Technology (MIT) - Department of Economics; Centre for
    Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

    Simon Johnson
    Massachusetts Institute of Technology (MIT) - Entrepreneurship Center; National Bureau
    of Economic Research (NBER)

    James A. Robinson
    Harvard University - Department of Government; Centre for Economic Policy Research
    (CEPR); National Bureau of Economic Research (NBER)

    There are 2 versions of this paper

    Date Written: February 2002

    Abstract
    Botswana has had the highest rate of per capita growth of any country in the
    world in the last 35 years. This occurred despite adverse initial conditions,
    including minimal investment during the colonial period and high inequality.
    Botswana achieved this rapid development by following orthodox economic
    policies. How Botswana sustained these policies is a puzzle because typically
    in Africa, 'good economics' has proved not to be politically feasible. In this
    Paper we suggest that good policies were chosen in Botswana because good
    institutions, which we refer to as institutions of private property, were in
    place. Why did institutions of private property arise in Botswana, but not
    other African nations? We conjecture that the following factors were
    important. First, Botswana possessed relatively inclusive pre-colonial
    institutions, placing constraints on political elites. Second, the effect of
    British colonialism on Botswana was minimal, and did not destroy these
    institutions. Third, following independence, maintaining and strengthening
    institutions of private property were in the economic interests of the elite.
    Fourth, Botswana is very rich in diamonds, which created enough rents that
    no group wanted to challenge the status quo at the expense of 'rocking the
    boat'. Finally, we emphasize that this situation was reinforced by a number
    of critical decisions made by the post-independence leaders, particularly
    Presidents Khama and Masire.

    Keywords: Development, institutions, Africa, political economy

    JEL Classification: H10, O10, O50

    Suggested Citation:
    Acemoglu, Daron and Johnson, Simon and Robinson, James A., An African
    Success Story: Botswana (February 2002). CEPR Discussion Paper No. 3219.
    Available at SSRN: https://ssrn.com/abstract=304100

    Botswana: A development-oriented gate-


    keeping state
    Ellen Hillbom

    African Affairs, Volume 111, Issue 442, 1 January 2012, Pages 67–
    89,https://doi.org/10.1093/afraf/adr070

    Published:

    21 December 2011

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    Abstract
    Due to a combination of exceptional economic growth and social development,
    Botswana has been hailed as an African developmental state. This article rejects
    the developmental state theory and instead attempts to build an alternative
    theoretical model. It argues that from the 1930s until the present, Botswana has
    experienced a state structure characterized by natural resource dependency,
    lack of economic diversification, a dual society, selective social development
    and a close connection between the economic and political elite. In the tentative
    theoretical model presented and discussed here, these are all defining traits of
    a gate-keeping state. It is hence argued that while Botswana's socio-economic
    development since independence should in no way be underestimated, it is
    better understood as the efforts of a development-oriented gate-keeping state
    rather than a developmental state.
    Citation
    Ellen Hillbom; Botswana: A development-oriented gate-keeping state, African Affairs,
    Volume 111, Issue 442, 1 January 2012, Pages 67–89, https://doi.org/10.1093/afraf/adr070

     Cited by 20

     Get access

     Volume 9, Issue 4
     August 2004 , pp. 485-505

    Sustainable development in mineral economies: the


    example of Botswana
     GLENN-MARIE LANGE (a1) and MATTHEW WRIGHT (a2) 

    o https://doi.org/10.1017/S1355770X04001469
    o Published online: 02 August 2004

    Abstract
    The Hartwick–Solow rule for sustainability requires that depletion of natural capital be offset
    by a compensating increase in other forms of capital capable of generating as much income
    as the natural capital they replace. Many countries have not been successful in transforming
    natural capital into other forms of wealth. This paper investigates the process of wealth
    transformation for Botswana, one of the most successful resource-rich countries. Using an
    expanded measure of wealth that includes manufactured capital, natural capital and net
    foreign financial assets, Botswana's per capita wealth has increased over the past 20 years.
    Government has recovered and reinvested rent. However, examination of the public sector
    capital budget reveals considerable unproductive investment. While correction for
    unproductive investments still indicates sustainable development, results suggest that
    aggregate indicators such as national wealth or genuine savings may be misleading without
    further attention to the process by which natural capital is transformed into other forms of
    wealth.

    LANGE, G., & WRIGHT, M. (2004). Sustainable development in mineral


    economies: The example of Botswana. Environment and Development
    Economics, 9(4), 485-505. doi:10.1017/S1355770X04001469

    Abstract
    Botswana has a small financial sector, dominated by the government, with a limited range of
    financial assets and undeveloped capital markets. Real assets are by far more popular than financial
    assets. The country was poor until the discovery of diamonds in the 1970s. Economic growth has
    been rapid even in the non-mining sectors such that the country is now ranked as a lower middle-
    income country. This study examines the relationship between financial development and economic
    growth in Botswana. Two indicators are used to examine Gragercausality between real per capita
    income and financial development. An error-correction method is adopted following the tests for unit
    roots and cointegration. The study suggests that per capita income in Botswana and the financial
    development indicators cause one another, supporting the view that economic growth causes and is
    caused by financial development in Botswana.

    JOURNAL ARTICLE

    FINANCIAL DEVELOPMENT AND ECONOMIC GROWTH IN BOTSWANA: A


    TEST FOR CAUSALITY / DÉVELOPPEMENT FINANCIER ET CROISSANCE
    ÉCONOMIQUE AU BOTSWANA: UN TEST DE CAUSALITÉ
    Oludele Akinloye Akinboade

    Savings and Development

    Vol. 22, No. 3 (1998), pp. 331-348

    Published by: Giordano Dell-Amore Foundation

    https://www.jstor.org/stable/25830662

    Page Count: 18

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