Endogenous Colonial Institutions: Lessons from Fiscal Capacity Building in British and French Africa, 1880-1940

The economic and historical literature is divided about the role of metropolitan identity for the design of colonial institutions. We explore the importance of exogenously imposed metropolitan policies and endogenous economic and geographic conditions on the comparative development of colonial tax systems in British and French Africa. Fiscal capacity building constituted the financial backbone of the colonial state formation process. Using colonial government budget accounts we construct PPP-adjusted comparisons of per capita government revenue, and we analyze the source composition of taxes. We find that local geographies and indigenous responses to commercial opportunities were key determinants for the design of local colonial tax systems and that typically ‘British’ or ‘French’ tax policy blueprints are hard to decipher