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World Development

Trade Concentration (TRADECON)

Trade concentration measures the colony’s trade with the metropole country as proportion of total trade. Main source for this indicator is the International Historical Statistics Data Set (Mitchell 2007). For the colonies for which no data are given in that volume, we found other sources, mainly the United Nations Commodity Trade Statistics (COMTRADE) Database and colonial/national histories, in very few cases we used estimates. Due to the poor data quality for many colonies, we decided to classify the cases in five categories:

  • 0 = trade concentration under 25%, no colonial trade effect is discernible, three quarter of goods exchanged with third countries/areas
  • 1 = trade concentration 25-40%, a moderate trade effect
  • 2 = trade concentration 40-50%, a significant trade effect
  • 3 = trade concentration 50-66.5%, a strong trade effect
  • 4 = trade concentration 66.6-%, a very strong trade effect

Unsurprisingly, for the semi-colonial countries (except Persia) no colonial trade effect is discernible; these countries were usually opened for trade under ‘most favored nation’-clauses. Also, for many colonies with an ‘open door’-policy, trade with the metropole country was not particularly strong. Together, 22 cases (27%) of our sample can be characterized as without colonially-induced trade distortion (level 0). For the same number of cases we find a moderate trade effect (level 1), while for ‘level 2’ 12 countries (15%) can be counted. 18 cases experienced a strong, 9 a very strong distortive effect (together one third of our sample). Among these 27 cases, there are five British colonies, 14 French, two Italian as well as the Japanese colonies (Korea, Taiwan). French colonies experienced significantly more often a distortive trade effect than British ones (see 'Descriptive Statistics'). In general, a high level of trade concentration was to be found in colonies with a high level of colonial investment and a disorderly transfer of administration. Additionally, there is a statistically significant relation between intensity of political domination and trade concentration.