Population Increase and the End of Colonialism

Herschel I. Grossman and Murat F. Iyigun

Economica, 1997, vol. 64, issue 255, 483-493

Abstract: Between 1946 and 1976, the European powers granted independence to all of their large colonies in Africa and Southeast Asia. This paper attempts to provide an economic explanation for this remarkable ending to the era of colonialism. The main theoretical innovation is to consider the effect of population increase on the allocation of time by the indigenous population between productive and subversive activities. The analysis suggests that the increase in population during the colonial period increased the potential private return to subversive activity until the colonies became a net burden on the metropolitan governments. It also suggests that there was less subversive activity in colonies in which the market for indigenous labour was monopsonized because monopsonistic employers internalized the potential negative effect of subversive activity on net profits.

Date: 1997
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