Journal of Economic Growth

, Volume 21, Issue 3, pp 225–257 | Cite as

The European origins of economic development

  • William EasterlyEmail author
  • Ross Levine


Although a large literature argues that European settlement outside of Europe during colonization had an enduring effect on economic development, researchers have been unable to assess these predictions directly because of an absence of data on colonial European settlement. We construct a new database on the European share of the population during colonization and examine its association with economic development today. We find a strong, positive relation between current income per capita and colonial European settlement that is robust to controlling for the current proportion of the population of European descent, as well as many other country characteristics. The results suggest that any adverse effects of extractive institutions associated with small European settlements were, even at low levels of colonial European settlement, more than offset by other things that Europeans brought, such as human capital and technology.


Institutions Human capital Political economy Natural resources 

JEL Classification Codes

043 01 P48 N5 

Supplementary material

10887_2016_9130_MOESM1_ESM.pdf (158 kb)
Supplementary material 1 (pdf 157 KB)
10887_2016_9130_MOESM2_ESM.xlsx (122 kb)
Supplementary material 2 (xlsx 122 KB)
10887_2016_9130_MOESM3_ESM.dta (53 kb)
Supplementary material 3 (dta 53 KB) (25 kb)
Supplementary material 4 (do 25 KB)


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Copyright information

© Springer Science+Business Media New York 2016

Authors and Affiliations

  1. 1.New York UniversityNew YorkUSA
  2. 2.The NBERCambridgeUSA
  3. 3.University of California, BerkeleyBerkeleyUSA

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