What about the race between education and technology in the Global South? Comparing skill premiums in colonial Africa and Asia

Summary

Historical research on the race between education and technology has focused on the West but barely touched upon ‘the rest’. A new occupational wage database for 50 African and Asian economies allows us to compare long-run patterns in skill premiums across the colonial and post-colonial eras (c. 1870–2010). Our data reveal three major patterns. First, skilled labour was considerably more expensive in colonial Africa and Asia than in pre-industrial Europe. Second, skill premiums were distinctly higher in Africa than in Asia. Third, in both regions, skill premiums fell dramatically over the course of the twentieth century, ultimately converging to levels long observed in the West. Our paper takes a first step to explain both the origins of the Africa–Asia gap and the drivers of global skill premium convergence, paying special attention to the colonial context that shaped demand, supply, and labour market institutions.