The significance of the Cape trade route to economic activity in the Cape Colony: a medium-term business cycle analysis
Trade is a critical component of economic growth in newly settled societies. This article tests the impact of ship traffic on the Cape economy using a time-series smoothing technique borrowed from the business cycle literature and employing an econometric procedure to test for long-run relationships. The results suggest a strong systematic co-movement between wheat production and ship traffic, with less evidence for wine production and stock-herding activities. While ship traffic created demand for wheat exports, the size of the co-movement provides evidence that ship traffic also stimulated local demand through secondary and tertiary sector activities, supporting the hypothesis that ship traffic acted as a catalyst for growth in the Cape economy.
Year of publication: |
2010
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Authors: | BOSHOFF, WILLEM H. ; FOURIE, JOHAN |
Published in: |
European Review of Economic History. - Cambridge University Press. - Vol. 14.2010, 03, p. 469-503
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Publisher: |
Cambridge University Press |
Description of contents: | Abstract [journals.cambridge.org] |
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