Settler skills and colonial development: the Huguenot wine‐makers in eighteenth‐century Dutch South Africa

Abstract

The institutional literature emphasizes local conditions in explaining divergent colonial development. We posit that this view can be enriched by an important supplyside cause: the skills with which the settlers arrive.The Huguenots who arrived at the Cape Colony in 1688/9, we argue, possessed skills different from those of the incumbent farmers, and this enabled them to become more productive wine-makers. We demonstrate this by showing that this difference is explained by none of the standard factors of production, nor by any institutional differences between the French and the Dutch. We observe that a group of Huguenot descendants from wine-producing regions maintained their advantage in wine-making at the Cape over several generations.This disparity cannot be satisfactorily explained as resulting from first-mover advantage or social capital. Specialized skills gave the Huguenots from wine-producing regions a sustained competitive advantage. Our results show that colonial institutions are shaped not only by whether immigrants settle or not, which legal system they adopt, or their language, religion, or beliefs, but by the set of skills, knowledge, and experience brought from their country of origin. As such, crosscountry comparisons may blur much of the detail when we analyse the effect that settlers have on the destination country.

Endogenous Processes of Colonial Settlement. The Success and Failure of European Settler Farming in Sub-Saharan Africa

“…Another transmission channel that has received ample attention is the diffusion of European or Western education, skills and knowledge via investments made in schooling by colonial governments and Christian missionaries (Gallego and Woodberry 2010; Nunn 2010; Woodberry 2012; Fourie and von Fintel 2014). These studies suggest that the presence of European missionaries and settlers had a positive effect on the development of literacy and school enrolment rates, as well as on the transmission of specific economic skills.…”

Human Capital Persistence and Development

“…The author argues that skilled Huguenots brought industry-specific knowledge that was complementary to new technologies. Fourie and von Fintel (2014) look at Huguenots that left wine producing regions of France to migrate to South Africa in this same historical episode and show, using tax records, that they became more productive wine makers than previously established farmers and that this difference in productivity persisted through time. Becker, Hornung, and Woessmann (2011) also look at Prussia and use occupational data to show that historical variations in schooling across counties, supposedly related to cultural factors, determined the ability of the different regions to take advantage of the technological innovations brought by the industrial revolution.…”

Cliometrics in South Africa

“…But it is the supply side that ultimately explains the settlers' high living standards: their access to inexpensive land (once the pastoral Khoe had been either pushed to the colonial frontier or drawn into the colonial economy), their use of slave labour, and the skills and institutions they had brought from Europe. Fourie and Von Fintel (2014) show that Huguenots from wine-making regions in France were more productive than those from wheat-producing regions. Fourie and Swanepoel (2018) show that networks of debt were deeply embedded in Cape society and used mostly for investment rather than consumption.…”