In most circles, colonialism is considered to be a sad episode in history—where dominant economic powers with sophisticated military might subjugated less developed, more vulnerable societies, turned them into colonies, imposed foreign languages and organizations upon them, and exploited local natural resources and labor. Indeed, Karl Marx argued that mature capitalist economies required such colonies in order to forestall their inevitable stagnation and decline. And there was a heavy price paid by the colonies themselves, with long-term negative consequences that are often pointed to as the reason why many of those societies remain poor today.
But this dark story has now been revised. A recent series of papers co-authored by Hoover Property Rights Task Force members Daron Acemoglu and James Robinson found that there were advantages from colonization as well, especially for those colonies within the British Empire. English institutions, such as the common law, property rights security, contract enforcement, and banking and trading practices provided a positive basis for economic growth in the colonies that has persisted.
Read Full Article »