The Long-Term Effects of Africa's Slave Trades - Social Sciences ...

Figure 7: Example showing the distance instruments for Burkina Faso.
Table 5 reports the IV estimates. In columns 1 and 4, I report the OLS
estimates, with and without colonial controls, for comparison. In columns 2,
3, 5, and 6, the IV estimates are reported. The first stage coefficients for the
instruments are negative as expected, suggesting that if a country is further
from slave markets, then less slaves are exported. All coefficients, except for
the distance from each country’s centroid to the coast and distance to the
Red Sea ports, are statistically significant.
In the second stage, the estimated coefficient for ln(exports/area) remains
significant and negative. Because the first stage F-statistics are low, I
report Anderson-Rubin confidence intervals. In all specifications the magnitudes
of the IV estimates are larger than the corresponding OLS estimates.
This is expected given the classical and non-classical measurement errors in
the slave exports variable, and the selection of the initially most prosperous
societies into the slave trades, both of which result in OLS estimates that
are biased downwards. If the instruments satisfy the necessary exclusion
restrictions and are uncorrelated with both sources of measurement error,
then the IV estimates will be larger in magnitude than the OLS estimates.
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