Colonial Exploitation and Economic Development: The Belgian Congo and the Netherlands Indies Compared (Routledge Explorations in Economic History)

Since many countries in the world at present were European colonies in the not so distant past, the relationship between colonial institutions and development outcomes is a key topic of study across many disciplines. This edited volume, from a leading international group of scholars, discusses the comparative legacy of colonial rule in the Netherlands Indies and Belgian Congo during the nineteenth and twentieth centuries. Whereas the Indonesian economy progressed rapidly during the last three decades of the twentieth century and became a self-reliant and assertive world power, the Congo regressed into a state of political chaos and endemic violence. To which extent do the different legacies of Dutch and Belgian rule explain these different development outcomes, if they do at all? By discussing the comparative features and development of Dutch and Belgian rule, the book aims to 1) to contribute to a deeper understanding of the role of colonial institutional legacies in long run patterns of economic divergence in the modern era; 2) to fill in a huge gap in the comparative colonial historical literature, which focuses largely on the comparative evolution of the British, French, Spanish and Portuguese Empires; 3) to add a focused and well-motivated comparative case-study to the increasing strand of literature analyzing the marked differences in economic and political development in Asia and Africa during the postcolonial era. Covering such issues as agriculture, manufacturing and foreign investment, human capital, fiscal policy, labour coercion and mineral resource management, this book offers a highly original and scholarly contribution to the literature on colonial history and development economics. Colonial Exploitation and Economic Development The Belgian Congo and the Netherlands Indies compared 8 Copyright 9 Contents 10 List of figures 14 List of tables 16 List of contributors 18 Preface 19 Introduction 22 0.1 Colonial exploitation and economic development 22 0.2 Comparing the Belgian Congo and the Netherlands Indies 24 0.3 Post-colonial economic divergence 28 0.4 Differences in the evolution of colonial connections 29 0.5 Organization 33 1 Extractive institutions in the Congo: checks and balances in the longue durée 39 1.1 Introduction 39 1.2 Pre-colonial history: traditional checks and balances 41 1.3 Colonial history: unchecked power 45 1.4 Post-colonial history: the unbalanced failing state 50 1.5 Conclusions 54 2 Colonial extraction in the Indonesian archipelago: a long historical view 62 2.1 Introduction 62 2.2 The Dutch East India Company (VOC), 1602–1799 62 2.3 The transformation of colonial rule, 1799–1830 64 2.4 The Cultivation System (CS), 1830–70 66 2.5 The liberal reforms, 1870–1900 69 2.6 The Ethical Policy, 1900s–20s 73 2.7 The Great Depression, the Japanese occupation, and Indonesia’s independence, 1929–45 75 2.8 Conclusion 77 3 Varieties of exploitation in colonial settings: Dutch and Belgian policies in Indonesia and the Congo and their legacies 81 3.1 Colonial exploitation: some definitions 81 3.2 Explaining the divergence in GDP growth after 1970 82 3.3 Indonesia, 1830–1942: a better class of exploitation? 83 3.4 The evolution of the Congo Colonial State: comparisons with Indonesia 89 3.5 Looking again at the post-1970s divergence 101 4 The land tenure system in the Congo, 1885–1960: actors, motivations, and consequences 109 4.1 Introduction 109 4.2 Staking a claim: land ownership status in the Congo Free State, 1885–1908 110 4.3 From the Congo Free State to the Belgian Congo: hesitant reform 111 4.4 Surveying the land: the decree of 1934 and formalized land adjudications 116 4.5 Land legislation disputes and the end of colonialism 120 4.6 Land policies and rural development 121 4.7 Conclusion 124 5 In the shadow of opium: tax farming and the political economy of colonial extraction in Java, 1807–1911 130 5.1 Introduction 130 5.2 The expansion of tax farming under Dutch colonial rule 132 5.3 The opium tax farm 135 5.4 The small tax farms 138 5.5 The end of tax farming and its long-term effects 141 5.6 Conclusion 145 6 Fiscal policy in the Belgian Congo in comparative perspective 151 6.1 Introduction 151 6.2 A difficult inheritance: the fiscal legacy of the Congo Free State 153 6.3 Reforming the Congo’s tax system after 1908 159 6.4 Public spending: a more familiar pattern 164 6.5 Financial relations between the Congo and the Belgian state after 1908 168 6.6 Conclusion: a colonial state struggling to catch up 169 7 Colonial education and post-colonial governance in the Congo and Indonesia 174 7.1 Introduction 174 7.2 Different approaches to colonial educational development 176 7.3 Comparing school enrollment rates, 1880–2000 181 7.4 The success of the missionary effort in the Congo 185 7.5 Comparing the quality of education 187 7.6 Education for self-determination 190 7.7 Conclusion 194 8 (Un)freedom: colonial labor relations in Belgian Congo and the Netherlands Indies compared 199 8.1 Introduction 199 8.2 Colonial rural exploitation in Java 200 8.3 The labor regime on the Outer Islands 202 8.4 New forms of unfree labor in the Belgian Congo 203 8.5 Comparative observations 207 9 Rubber cultivation in Indonesia and the Congo from the 1910s to the 1950s: divergent paths 214 9.1 Introduction 214 9.2 Factor endowment in Indonesia and the Congo 215 9.3 Large plantations in Indonesia 217 9.4 Large plantations in the Congo 219 9.5 Smallholdings in Indonesia 221 9.6 Smallholdings in the Congo 224 9.7 Conclusion 227 10 Manufacturing and foreign investment in colonial Indonesia 232 10.1 Introduction 232 10.2 Modernity in a traditional context 233 10.3 The different faces of capitalism 238 10.4 Unilever Indonesia 242 10.5 Conclusion 245 11 The industrialization of the Belgian Congo 250 11.1 Introduction 250 11.2 “Raubwirtschaft” (1885–1908) 252 11.3 The first wave of industrialization (1920–40) 253 11.4 The second wave of industrialization (1940–58) 258 11.5 Planning for the development of heavy industries (1958–60) 262 11.6 The collapse of the Congolese industrial complex 263 11.7 Summary and conclusions 266 12 Mobutu, Suharto, and the challenges of nation-building and economic development, 1965–97 272 12.1 Introduction 272 12.2 Similar challenges, different circumstances 278 12.3 Political versus economic capacity building 280 12.4 Urban versus rural interests 283 12.5 The reversal of fortune 284 12.6 Conclusion 289 Conclusion 295 Index 302 This book discusses the comparative legacy of colonial rule in the Netherlands Indies and Belgian Congo during the nineteenth and twentieth centuries from a wide range of social, political, economic and institutional perspectives.