Jun 23, 2020 in Management

Transatlantic Trade versus Africa’s Underdevelopment

Africa is mostly underdeveloped as compared to other continents of the world, especially Europe as these are a key point of reference throughout the essay. The state of economics has been the foundation of the above conclusions relevant to the continent at large. In other words, while Africa has its fair share of development, it tends to lean primarily on the underdeveloped side of the scale.

Therefore, with respect to the term underdevelopment, the human social perspective is what is being employed as a concept that relates to an economic viewpoint. When the factors of production are considered, Africa is not strongly endowed with these factors as well as its wealth in the context of gross domestic product (GDP) as a means of measurement the wealth. The undisputable fact is that the continent has been riddled with backwardness and has been labeled as the ‘black continent’ due to the constant shadows of social ills and deterioration as part of its environment deeply rooted in its history.

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However, African underdevelopment is a complex issue with 2 main external factors as the major contributors to its current state. Such phenomena as the trans-Atlantic trade and colonialism have been a lingering reminder of disregarded value of the human life can do to negatively impact on the future of a once vibrant continent. This circumstance has led to the exposure of Africa as a continent to exploitation as an easy target for the powerful nations of the world. The downfall of Africa began during the transatlantic slave trade that occurred between the 15th and 19th centuries. Africans from the western, central and southern parts of the continent were captured and sold to slave traders that were sea merchants in the Atlantic Ocean, and in this way, the exploitation of the continent was initiated. Before the arrival of the Europeans and Americans, who had a constant demand for slaves to work in their plantations, Africa enjoyed stability and was a developing continent that had strong economies and political structures to sustain their way of life.

Despite of the complex nature of the analyzed phenomenon, tone must admit that the underdevelopment of Africa was strongly propagated through the transatlantic slave trade. This aspect ruined the stability of the continent because of the greed portrayed by the dominant European nations who wished to enrich themselves from the vast African resources that were the most exploited through the slave trade. Statistical and empirical evidence exists to support this claim. For instance, the argument advanced by Nathan Nunn has showed that there was a high negative relationship between the shipment of slaves from the continent and its economic performance. The evidence that the researcher has collected and the conclusion which he has drawn entirely supports the suggestion that slave trade had a detrimental effect on the economic development of the economy of Africa. However, to understand the allegation put forth, there is a need to provide additional empirical support for the assumption by answering the question “was the slave trade carried out during the transAtlantic trade the major cause of underdevelopment in Africa?”

Significance of the Study

The problem of underdevelopment in the African continent is a cause of sufficient debate because there are many factors to be considered in the economic sense. Nevertheless, it is undeniable that enslavement of the African people has immensely contributed to the underdevelopment of the continent through exploitation of its different resources even presently. Countries in this part of the world have received numerous grants and aid making it over-dependent on the countries that are more developed. Providing the answer to the set research question is both useful to the African states because they need to reevaluate their economic strategies. The nations have substantial natural resources which, if handled well, will assist the populations in recovering from the long-term underdevelopment. As for the rest of the developed nations who have the upper hand in policy formulations that steer economic development, the findings will provide the information for implementing the solutions that will be favorable to the continent as well as other countries in collaboration. This objective can be achieved through agreeing that slavery instigated by the powerful countries of the West has derailed the continent’s development.

Empirical Literature Review

Slave Trade as a Genesis of Corruption Leading to Underdevelopment

According to common beliefs, Africa is a continent that is damaged by socials ills, including civil unrest and diseases, poverty, crime and, most abundantly, corruption. Undoubtedly, the African leaders are the cause of the mismanagement of the funds because they have been drawn towards corruption by the outside world. For a long time, Africa has been a continent dependent on the international aid. In this respect, dependency theorists have argued that the superpowers, who have exploited Africa, are the primary cause of its underdevelopment. However, scholars and practitioners assume that corruption had to emanate from some earlier phenomenon, and looking at the slave trade, the answers can be found. It is true that slavery brought Africa into contact with the outside world, but it could also be said that the Africans learned how to conduct business through slave trade. With a reference to contact with the outside world, especially the Europeans, there was a great exchange of new technologies and superior imported goods. The trade thereof is on commercial practice and the availability of products, even though it was conducted through the slave trade. Inevitably, with regard to this form of learning, that is, through the slave trade, the Africans began their entrepreneurship from the most unpleasant side of business. Moreover, this aspect is likely to imply the modern way of conducting business on the continent. Thus, slavery, in the holistic the sense of the word, was corruption because of the way it was organized with respect to theft, bribery, and the use of force among other issues. 

Therefore, slavery may be considered as the original precolonial source of modern day corruption. All of the flaws that were present in the African society and the influence of slavery are some of the determinants that can be used to point out to corruption. The Africans had been taught commoditization of humanity through ruthless political and social life, coupled with the temptation to get ahead and survive. In this way, they took a short-range view of economic conditions. Finally, such a belief had been entrenched into their minds. As a consequence, since the political aristocrats of the time learned how to stay wealthy through bad business, the modern day African leaders closely follow their footsteps and continue to exploit the resources with the contemporary ‘slave master’, the developed nations.

Depopulation during Slave Trade as a Catalyst of Underdevelopment

Feser and Sweeney’s study focuses on reviewing an important aspect of the topic whether outmigration and population loss are potential indicators of economic distress. Indeed, migration is a highly selective process whereby younger, more educated and highly skilled workers move from or within their country of origin as a response to the economic decline. The importance of the research in the discussion of slavery as a cause of underdevelopment in Africa is that there is a suggestion that migration or movement of people from a region deprives it of the opportunities for the economic development. Although the study suggests that it may be in response to the gradual economic decline, the above process may also be a cause of the economic deprivation of a region. 

In addition, Nunn has found a negative relationship between the number of slaves exported from the African countries and their economic performance. In this context, the main finding was the specification of a correlation between the poorest countries and the number of slaves that were taken from them. To understand the relationships suggested in his study, Nunn reviewed the evidence from the African historians into the selection of slaves. As a conclusion, the scholar has discovered that slaves were shipped from the most developed areas in Africa. 

Apart from that, the research provides the evidence suggesting that about 12 million slaves were sold in the scope of the transatlantic slave trade. The numbers hugely disrupted the population growth that caused a negative trend since by the year 1850, a genuine representation of the population, if slave trade was inexistent, was marred. Because the evidence exists that slaves were taken from the most developed nations of Africa, it would be correct to suggest that the development of these countries occurred could be due to performance of skilled craftsmanship and professions. Therefore, it is right to conclude that those African countries were deprived of the possibilities to progress, and this effect is still observed today, as suggested in the studies, making the countries of the region ultimately underdeveloped. 

Effective Demand on Adverse Resource Allocation

Another of the factors that are responsible for the misdirection of the economic activity in Africa was the increased international demand for slaves. In his study, Whatley and Gillezeau have suggested that the increase in demand for slaves altered the continent’s approach to development of the economy. As a consequence, Africans themselves tended to capture and export many of their people. The research has considered demand as an exogenous factor because the African slave producers were deemed to be price-takers in terms of their adaptive response to slave trade trends with changes in price. The study points out that, since Africans had responded to an external stimulus, the external factors of demand had to have had an impact on their economies. 

The term ‘effective demand ‘is drawn from Keynes theory of employment that was introduced to denote the total demand for goods and services, which  people see in both consumption and investment in a community setting.  What the theory suggests is that in the money-based economy, effective demand manifests itself when income is spent or how expenditure flows. When the demand of African slaves increased, the factor mostly resulted in the growth in value of the people in trade relative their value in production. More resources were allocated in enslaving more Africans, that is, to suggest that there was a high return in slave raiding. Whatley and Gillezeau’s study focused on Curtin’s economic model. The framework was related to the fact that if the African producers of slaves responded to financial incentives, subsequent increases in demand should have resulted in the number of slaves that appeared on the coast for export. The study was able to support the model because it has revealed that after 1750, there was an increase in the supply of slaves that outstripped demand which drove up prices of slaves, eventually. By the end of the 17th century, slave prices rose and it latter intensified nearly at the end of the 18th century. 

On the other hand, the British wars reduced the demand for African slaves resulting in a decrease in the equilibrium prices. The opposite was true when the British exports to Africa were seen to increase as it drove for an increased demand for slaves. This circumstance drove the equilibrium prices higher and resulted in the Africans capturing more of their own people for trade. In this context, the increase in international demand for slaves significantly affected the allocation of resources in terms of slave production in Africa. Therefore, the slave trade was an easier option than cultivating the land which would have resulted in taxation to grow the economy.

Opposing Views on Slave Trade as the Cause for Underdevelopment

From the opposite view in regard to the relationship between the slave trade and Africa’s underdevelopment, one should refer to the theory that disease is one of the fundamental causes of underdevelopment in Africa with all the other factors being statistically insignificant. In her study, Bhattacharyya strongly supports this view by showing a strong negative relationship between malaria as the disease to which she alludes to and national savings. Her model has showed that malaria adversely affects the growth because this factor increases mortality and morbidity rates. The researcher has pointed out that malaria causes households to spend more on consumption which results in saving less for the family’s future. At the same time, increased morbidity, as a consequence of the disease, negatively impacts the levels of labor productivity. Hence, malaria results in the adverse effects of the two combined factors that eventually causes a slowed trend in the capital accumulation and economic growth. 

While Bhattacharyya has keenly focused on the endogenous factors within the African continent as the cause of its underdevelopment, the disease is highly unquantifiable to be considered as one of the leading causes of the economic underdevelopment. While this disease has been cited as the primary reason for the underdevelopment, it is a narrow view since many other diseases endemic to the nation were present before the slave trade. Moreover, as the other studies mentioned have shown, there were prosperous countries on the continent even before.

Conclusion

Slave trade was as a result of the transatlantic trade that increased the sale of slaves to the European nations. The empirical evidence that was evaluated above showed clearly the close link between the slave trade and the underdevelopment in the continent. The region suffered a series of perpetuated violence that led to the destabilization of the political systems, social stratification that incited the uprising of civil unrest, and large depopulations of communities as a consequence of the effective demand for slaves. The African continent continues to suffer from these atrocities committed centuries ago because it is evident that the continent is still exploited and many of the nations are still over-dependent to the former ‘slave masters.’ 

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