Imperial Profits. The globalization of financial markets the return on investments in Africa, 1869-1969

Research project
Active research
Project period
2015 - 2022
Project owner
Unit for Economic History, Department of Economy and Society

Jan Wallanders och Tom Hedelius Stiftelse, Stiftelsen för Ekonomisk Forskning i Västsverige, Malmstenska fonden (strategisk satsning)

Short description

The aim of this project is to estimate the return on capital from British investments in Africa during the colonial era, from the end of the nineteenth century to the middle of the twentieth century. We investigate how the return develops over time, in different parts of Africa.

The aim of this project is to study the possibilities that private investors had of profit from imperialism, from the middle of the nineteenth century until the wave of independence around the 1960s. Our analysis departs from international investors based in Great Britain. This means that we study the concrete investments choices they faced – for example in domestic British industries, Swedish railways, gold mines in Australia or in South Africa. The overarching research question is concerned with what return was generated from investments in different colonies, and how high this return was in comparison with investments domestically or in non-colonized territories.

The project contributes to our understanding of the first wave of globalization, and its long-term consequences for long-term economic development. By analyzing the return on investments in ventures operating in Africa, we will be able to contribute with new knowledge on the level of financial market integration and on what terms that the periphery was integrated in the expanding global financial markets at the time.

Many colonies, particularly regions rich in natural resources, were heavily influenced by imperialism during the nineteenth century process of globalization. These countries experience differ from other countries in the global periphery – such as the Nordic countries – since the colonial institutions imposed limited the possibilities for managing the consequences of globalization. By studying the patterns of international investments and returns, we can describe the complexities of the process of globalization.

In the project, we have constructed a longitudinal database consisting of companies listed on the London Stock Exchange, but operating in Africa, during the period 1869 to 1969. The database is used to calculate the total return on investments, including both the dividends and the capital gains, which is by now standardized methods employed in financial history,

Rönnbäck, Klas and Oskar Broberg (2019): Capital and Colonialism: The Return on British Investments in Africa, 1869-1969. London: Palgrave Macmillan.

Rönnbäck, Klas & Oskar Broberg & Stefania Galli (2022): “A Colonial Cash Cow: The Return on Investmens in British Malaya, 1889-1969”, Cliometrica 16:149-173.

Rönnbäck, Klas and Oskar Broberg (2021): ”The Crumble in the Jungle: The London Financial Press and the Early Booms-and-Busts of the Ashanti Goldfields Corporation, 1895-1914”, Enterprise & Society 22(4): 970-996.

Broberg, Oskar and Klas Rönnbäck (2020): ”Aednan och Bolaget: ett kolonialt perspektiv på gruvbrytning i Sápmi vid 1900-talets början”, Historisk Tidskrift 2020 (3): 476-497.

Rönnbäck, Klas & Oskar Broberg (2018): “All that glitters is not gold: The return on British investments in South Africa, 1869-1969”, Studies in Economics and Econometrics 42(2):61-79.

Rönnbäck, Klas & Oskar Broberg & Dimitrios Theodoridis (forthcoming): ”Fool’s Gold: The Return on Investments in Global Mining, 1869-1969”, accepted for publication in Journal of European Economic History.

Rönnbäck, Klas and Oskar Broberg (forthcoming): “From defensive to transformative business diplomacy. The British South Africa Company and the end of chartered company rule in Rhodesia, 1910–1925”, accepted for publication in Business History Review.