African Cities and the Structural Transformation: Evidence from Ghana and Ivory Coast

Type Working Paper
Title African Cities and the Structural Transformation: Evidence from Ghana and Ivory Coast
Author(s)
Publication (Day/Month/Year) 2011
URL http://siteresources.worldbank.org/EXTABCDE/Resources/7455676-1292528456380/7626791-1303141641402/78​78676-1306270833789/Parallel-Session-12-Remi_Jedwab.pdf
Abstract
Africa has recently known dramatic urban growth, which is good news if urbanization drives growth. Yet, the agglomeration effects story was built on manufacturing, a ”missing” sector in Africa. I develop a structural transformation model where primary exports (cash crops, mining) push urbanization, through a rise of the nontradable service sector. This gives rise to consumption cities where spillover effects are lower than in production cities, thus questioning the link between urbanization and growth. I illustrate this model with a case study on cocoa production and
cities in Ivory Coast and Ghana, two highly urbanized African countries. Combining decadal district-level data on cocoa production and cities from 1901 to 2000, I document how cities follow the cocoa front, using the fact that cocoa is a migrant culture as an identification strategy. I find that cocoa production launches a self-reinforcing urbanization process. I give evidence for the channels behind this relationship, emphasizing consumption linkages. I show that the employment structure of those cities might prevent them from being engines of growth.

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