METROPOLITAN EXPORTS LOST THROUGH DECOLONIZATION—SOME CONCEPTUAL AND STATISTICAL PROBLEMS
| Date | 01 August 1978 |
| Published date | 01 August 1978 |
| Author | EPHRAIM KLEIMAN |
| DOI | http://doi.org/10.1111/j.1468-0084.1978.mp40003006.x |
METROPOLITAN EXPORTS LOST THROUGH
DECOLONIZATION-SOME CONCEPTUAL
AND STATISTICAL PROBLEMS
By EPHRAIM KLEIMAN
In a recent paper in this Bulletin, Ian Livingstone measured the effect of decolo-
nization on the exports of the U.K. and of France.' However, his estimates raise
a number of conceptual and statistical questions. They are discussed in this paper,
which also presents some alternative estimates of the export loss.
1. DEcoLoNIzATIoN AND THE OVERALL LEVEL OF IMPORTS
Livingstone defines a 'hypothetical loss of exports' to the metropolitan country
as that due to the decline, after independence, in its share in the imports of its
former colonies. Denoting a colony's total imports by M, the metropolitan power's
share in them by m, and total metropolitan exports by T, his measure of the frac-
tion of the latter lost because of decolonization is thus equal to
(m0 - m1)Mj/T,, (1)
where the subscripts O and 1 refer to the benchmark (pre-independence) and the
comparison periods, respectively.
However, the effect of decolonization on metropolitan exports is not limited to
the market share effect investigated by Livingstone. It has been argued that
colonial powers sought to prevent both competition with their own exports and the
diversion of resources from the colonial production of raw materials imported by
them; and that their abstention from protecting the industries of their dependen-
cies, resulted in an over-expansion of the latter's foreign-trade sector.2 By remov-
ing the restrictions on the development of domestic industry, decolonization might
have been expected to reduce the colonies' imports (and exports). As I have shown
elsewhere, mulatis mutandis this is indeed what happened: in the period following
independence, the imports of the former colonies grew much more slowly than those
of other less developed areas.3 Thus, had colonial rule persisted, the imports of the
colonies would have been greater, and the metropolitan power's share of them
higher, than they actually were after independence.4 On the assumption that,
1Ian Livingstone, 'The Impact of Colonization and Independence on Export Growth in
Britain and France', BULLETIN, 38 (August 1976), 211-18.
ZFor this 'structural distortion' argument see H. W. Singer, 'The Distribution of Gains
between Investing and Borrowing Countries', American Economic Review, 40 (May 1950), 473-
85; Rau! Prebisch, 'Commercial Policy in the Underdeveloped Countries', American Economic
Review, 49 (May 1959). 251-73; G. Myrdal, An International Economy (New York: Harper,
1956).E. Kleiman, 'Trade and the Decline of Colonialism', Economic Journal, 86 (September
1976), 459-80, section 7.
In correspondence with the Editors, Mr. Livingstone has argued that, had colonial rule
persisted, the colonial powers would have been unable to prevent import substitution from
taking place (presumably of imports from non-metropolitan countries). But the post-inde-
pendence substitution of domestic production for imports from the metropolitan countries
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