Why Did Botswana End Up with Good Institutions: The Role of Culture and Colonial Rule.

Abstract

Botswana has achieved astonishing economic success and an impressive record of institutions that distinguishes it from many other African countries. This article examines the reasons for Botswana’s strong institutional setup, which is considered fundamental to the country’s economic success since independence. To do so, it will utilize the analytical framework provided by institutional economics. The article argues that Botswana ended up with better institutions than most of ist African counterparts for three reasons: a) Pre-colonial Tswana culture comprised a number of informal institutions which were useful for creating a modern state. Most strikingly, the chiefs’ powers were restrained and the political elite pursued strong economic interests. b) “Light” colonial rule by the British largely left Tswana institutions in place. c) Tswana institutions were successfully merged with modern institutions many of which modelled on European examples.

Keywords: Africa, Botswana, institutions

JEL Classification: N97, O17, O43