The Economic Reach of the State: African Development Reconsidered

Divergence in relative productivity levels and living standards is the dominant feature of modern economic history. In the last century, incomes in the "less developed" (or euphemistically, the "developing") countries have fallen far behind those in the "developed" countries, both proportionately and absolutely. I estimate that from 1870 to 1990 the ratio of per capita incomes between the richest and the poorest countries increased by roughly a factor of five and that the difference in income between the richest country and all others has increased by an order of magnitude. This divergence is the result of the very different patterns in the long-run economic performance of two sets of countries [Pritchett, 1997, p. 3].