Lecture 8 Notes

The colonizer xed effects are indicator variables for

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Unformatted text preview: ted. The dependent variable is the natural log of real per capita GDP in 2000, ln y. The slave export variable ln(exports/area) is the natural log of the total number of slaves exported from each country between 1400 and 1900 in the four slave trades normalized by land area. The colonizer fixed effects are indicator variables for the identity of the colonizer at the time of independence. Coefficients are reported with standard errors in brackets. ∗∗∗ , ∗∗ , and ∗ indicate significance at the 1%, 5%, and 10% levels. for slave exports remains negative and significant, and the magnitude of the estimated coefficient actually increases.9 9. One may also be concerned that the inclusion of the countries in southern Africa—namely South Africa, Swaziland, and Lesotho—may also be biasing the results. As I report in the Appendix, the results are robust to also omitting this Direction of causality OLS estimates show there is a relationship between slave exports and current economic performance Still unclear whether slave trades have a causal impact on current income Alternative explanation for relationship: societies that were initially under developed selected into slave trades these societies continue to be under developed today Therefore we observe a negative relationship between slave exports and current income even though the slave trades did not have any effect on subsequent economic development Two strategies to evaluate whether there is a causal effect of th...
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