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Media as Ends: Money and the Underdevelopment of Tanganyika to 1940

Published online by Cambridge University Press:  11 May 2010

D. M. P. McCarthy
D. M. P. McCarthy
Affiliation:
Iowa State University
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Abstract

Scholarship on African “underdevelopment,” its antecedents, manifestations, and consequences, is now limited in focus and method. This article suggests a broader approach and emphasizes insights that might come from combining aspects of economic anthropology with analysis of institutions. A modest case study then sketches some monetary perceptions and policies of Tanganyika's colonial bureaucracies (German and British) and their reception by Tanganyika's diverse population. Indigenous reaction to alien media was rational within a neo-classical tripartite demand-for-money framework. The combined consequences of all parties'actions for both the territory's “underdevelopment” and “under-growth” receive final but not definitive scrutiny in the last section.

Type
Articles
Information
The Journal of Economic History , Volume 36 , Issue 3 , September 1976 , pp. 645 - 662
Copyright
Copyright © The Economic History Association 1976

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References

1 For a most stimulating analysis of some aspects of current argument see Hopkins, A. G., “On Importing Andre Gunder Frank into Africa,” African Economic History Review, 2, no. 1 (1975), pp. 13–21CrossRefGoogle Scholar.

2 Elsewhere I attempt to define and then analyze the origins, manifestations, and significance of the so-called bureaucratic economy in the Tanganyikan case (“Organizing the Bureaucratic Economy in Tanganyika, 1919–40,” unpublished conference paper under revision). As the local colonial administration centered in Dar es Salaam sought its related goals of revenue and security, it pursued policies which sometimes conflicted with, sometimes reinforced, but most often constrained the growth and/or development of such ill-defined macro-entities as the “metropolitan economy” or “capitalist world-economy.” Tax policy is one obvious arena of The Tanganyika bureaucracy, which must remain too impersonal here, levied a range of indirect taxes including excessive railroad rates, multiple marketing fees, and export cesses. These constrained the production possibilities frontiers for many people, retarded internal trade, and perhaps undermined via higher prices the competitiveness of Tanganyika's own exports in global markets.

In many other less measurable areas most bureaucrats tried, with varying degrees of success, to manipulate indigenous activities. Consider briefly a few aspects of agricultural policies. The bureaucracy wanted residents to produce more crops in accordance, at first glance, with alleged imperial requirements. But the local administration encouraged production of anything, regardless of world demand, that it might tax as those commodities moved through channels. Moreover, official “encouragement” involved techniques which undermined prices as both incentives and communicators of market information. Eschewing in most instances physical coercion, local administrators relied instead on varieties of language manipulation to urge the populace on. Such actions tended, among other things, to confuse the operation of existing internal markets. (I consider these issues in “Manipulating Language in Colonial Tanganyika,” unpublished conference paper under revision.) Whether all these modes of official intervention in agriculture served in most respects those alien “economic interests,” whatever they were, is doubtful.

3 The concept of optimal media mix was inspired by Mundell's, Robert A. “A Theory of Optimum Currency Areas,” American Economic Review, 51 (Sept. 1961), pp. 657–665Google Scholar. His concerns were, however, international exchange rates and balance-of-payments adjustments.

4 To oversimplify, ethnoscientists concentrate on exposing the structures of perception in different societies through rigorous construction of folk taxonomies in different areas, such as medicine, religion, economics, etc. Most scholars have strong views on the merits or demerits of this approach, and here I merely wish to recognize a lode of evidence which economic historians might use, if in modified fashion.

5 Annual Report by the Treasurer of Tanganyika for Financial Year 1923–24 (Dares Salaam, 1924), pp. 99–107Google Scholar.

6 For a few scholars natural and money economy did not represent altogether separate stages of progress or development, because the forms of exchange were not completely disjunctive: some transactions intermixed elements of barter and cash. Eli F. Heckscher made this point in his “Natural and Money Economy As Illustrated from Swedish History in the sixteenth Century,” which first appeared as an article in the Journal of Economic and Business History, 3 (1930–1), pp. 1–29Google Scholar, and later as a reprint in Lane, Frederic C. and Riermsma, Jelle C., eds., Enterprise and Secular Change (Homewood, Illinois, 1953), pp. 206–28Google Scholar. Most Tanganyikan bureaucrats could not or would not hear those grace notes.

7 One must treat these ratios with caution, since they derive from figures published in annual reports of the East African Currency Board and in Tanganyika's rendering of its own accounts and finances. The main point, however, concerning a Tanganyikan coinage-to-notes ratio that ran counter to the regional experience, seems prima facie acceptable.

8 Tanzania National Archives, Dar es Salaam, Tanzania (henceforth TNA), Ace. 215/File 184. Secretariat Circular No. 88 of 1925, Memorandum on Trade and Markets by Donald Cameron, 12 December, 1925.

9 TNA Dodoma district report for 1923, p. 3.

10 TNA Rufiji district report for 1934, 3/IX/D, p. 7.

11 This point goes beyond Heckscher's insistence on a mixture of exchange forms a priori, for there were various perceptions of those forms a posteriori.

12 TNA 1733/15. A. West, Songea district report for 1923, p. 6.

13 TNA 21438, Vol. III. G. R. Sandford, Treasurer, to Secretary, East African Currency Board, 6 August 1937.

14 Changing alien monetary systems also prompted many residents to reflect on comparative intrinsic values of coins. In 1923, for example, the year of official demonetization of German coinage, District Officer West observed that “on the first arrival of the new shillings their intrinsic value as silver was immediately compared with that of the German rupees and the depreciation noted. Subsequent usage of the coinage resulting in deterioration in appearance confirmed the fact” (West, Songea district report for 1923, p. 5). And this same reaction occurred in Dar es Salaam district. District Officer Scott reported in 1922 that “some comment is heard on the value of the new shilling owing to the tendency of this coin to assume a copper hue after it has been in circulation” (TNA 1733/22. F. W. Scott, Dar es Salaam district report for 1922, p. 12).

15 Sandford letter, 6 August 1937.

16 West, Songea district report for 1923, p. 6.

17 TNA 11869. Acting Provincial Commissioner, Lake Province, to Treasurer, Dar es Salaam, 8 June 1935, p. 2.

18 Treasurer Sandford, in his letter to the Secretary of the East African Currency Board, observed that “a shortage of cents tends to reduce the number of cents obtainable for a shilling during the course of a transaction and a shortage of silver similarly tends to undermine the local value of a five or ten shilling note.”

19 Acting P. C, Lake, to Treasurer, 8 June 1935, p. 2.

20 TNA 1733/52. Tabora district report for 1925, p. 5.

21 TNA 77/A. A. W. M. Griffith, Bukoba district report for 1927, no page number.

22 Treasurer Sandford, in that 1937 letter, argued that coinage followed an “annual anticlockwise movement” through the Lake Province which left that area without sufficient coins for succeeding seasons and led to the “accumulation of excessive stocks which must ultimately be repatriated to Kenya and Uganda.” This build-up took place because there was little contact between producers in the Lake-Tabora region and those to the east. The Lake Province got most of its cental coinage from Uganda, since the Tanganyika Railroad charged a 6 percent tariff ad valorem on both silver and copper shipped from Dar es Salaam, but transport costs from Uganda to Mwanza were 1.5 percent. This counter-clockwise movement might be broken, Sandford argued, by establishing Tanganyika's own specie deposit at Mwanza. He won his case, but this deposit had little effect on experience before 1940.

23 TNA 77/B. A. W. M. Griffith, Bukoba district report for 1928, no page number.