This paper evaluates the nature of institutions that characterize Namibia in the form of property rights, judiciary systems and political freedom for the period 1884 to 2008. This is done through the construction of de jure and de facto indicators of property rights, political rights and civil liberties and judicial independence, using legislation as an indication of the rules of the game. These indices chosen represent the political and economic institutions considered important for economic growth. The lengthy time period is chosen following the suggestion by Kaufman et al. (2003) that the likelihood of observing significant changes in institutional variables substantially increases with the length of time under consideration.
Crucial to this study, the period under review also allows the examination of the hypothesis of the persistence of inherited institutions. According to Acemoglu et al. (2001), in areas where Europeans showed strong settlement patterns, they created institutions characterized by strong protection of property rights and efficient enforcement of contracts. They argue that these institutions, created by colonizers, have persisted over time and they continue to influence economic performance after independence.
Namibia like many other developing countries, finds itself at the heart of these debates. Among the German colonies in Africa, Namibia and Tanzania were the only colonies with sizeable German populations, which underscore the presence of European settlement in these countries. The systematic divergence in growth per capita over a long period among many developing countries and the possibility of country heterogeneity underlines the crucial importance of utilizing longer time series for explaining growth trajectory differences.
An alternative approach is to consider constructing longer dated indicators of a de jure and de facto nature to allow for testing the impact of institutions on economic growth over time. The study contributes to the growing institutions growth empirical literature by providing alternative indices of political freedoms, property rights, judicial independence and political instability for Namibia for the period 1884-2008. The paper traces the genesis and the developmental transformation of the institutional framework in Namibia from 1884 to 2008, using various legislations promulgated during the period under review.
Results of the study show the following:
the cross country comparisons between Namibia and Tanzania reveal a comparable pattern in political freedoms and judicial independence both under the German colonial administration and subsequently, under the British colonial administration over Tanzania and the South African colonial administration over Namibia
the property rights patterns remain divergent between the two countries under the German colonial rule
despite changes in colonial regimes, the broader framework of institutions remained partly the same