When Did South African Markets Integrate Into the Global Economy?

This research note identifies the period when South African prices began to move in unison with those of the country's lead trading partner. We find that South African wheat prices started reflecting UK trends soon after the discovery of diamonds and gold in the interior of the country. The mineral revolution, it seems, was responsible for integrating the broader South African economy – here proxied by agricultural prices – into the global economy. We further show that this integration was not confined to Cape Town; the coming of the railways ensured that markets in the larger Western and Eastern Cape and, importantly, the town of Kimberley, were well integrated with those in Cape Town. We therefore establish the start of South Africa's integration into the global market economy in the 1870s