Is the British colonization better than that of the French?: A study of Vanuatu
Dongwoo Yoo (dongwoo.yoo@mail.wvu.edu)
Comparative studies have suggested that the British colonization is more beneficial than those
of France and other colonizers. It is argued that the British cultures and institutions contributed
to stable politics and robust economic development of its colonies. However, evidence is still
inconclusive because a controlled experiment is very difficult in social science. Vanuatu – a
Pacific island – provides an excellent experimental setting for testing the argument. Britain and
France established a joint government, the British government, and the French government,
which lasted from 1906 until 1980, in the same territory. Local people could choose whether to
be tried under the British common law or the French civil law. Nationals of one country could
set up corporations under the laws of the other. The case of Vanuatu suggests that political
indicators are in favor of Britain, but economic indicators are in favor of France. The French
dominated areas have been more developed than the British dominated areas. The major British
trading company established a company under the French law and a certain number of British
planters registered themselves in the French residency to attain the benefits of French economic
policies.
1. Introduction
A large strand of work evaluates the legacies of colonial rule on socio-economic
development (La Porta et al., 1997, 1998; Acemoglu, Johnson, and Robinson 2001, 2002;
Engerman and Sokoloff 2002; Banerjee and Iyer 2005; Nunn 2007, 2008). Comparative studies
have suggested that the British colonization is more beneficial than those of France and other
colonizers (Hayek 1960, Lipset 1993, La Porta et al. 1998, 1999; see also critiques Acemoglu,
Johnson, and Robinson 2001, Lee and Schultz 2009; for summary, see La Porta, Lopez-DeSilanes, and Shleifer 2008). It is argued that the British cultures and institutions contributed to
stable politics and robust economic development of its colonies. The effect of colonial origins on
economic development and democracy is hypothesized to operate through three mechanisms.
First, common law systems provide greater rights to investors and property owners compared to
the civil law. Second, British culture creates a strong commitment to the enforcement of
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contracts. Third, the independent judiciary and emphasis on separation of powers in common
law systems provide a greater number of checks on political expropriation. The argument has
generated a good deal of controversy and many scholars have used a series of quantitative
methods to test the argument, both within and across nations. However, evidence is still
inconclusive partly because a controlled experiment is very difficult in social science.
Vanuatu (or New Hebrides before independence) – consists of approximately eighty
islands, lying 1,500 miles northeast of Sydney, Australia, 600 miles northwest of Fiji, and 300
due east of New Caledonia – provides an excellent quasi-experimental setting for testing the
argument on the consequences of colonial rule. Britain and France established the Anglo-French
Condominium (a joint government), which lasted from 1906 until 1980. In international law, a
condominium is a political territory where two countries formally agree to share sovereignty
equally and exercise their rights jointly. However, condominiums have been very rare in
practice (Miles 1998, 31). A major problem is the difficulty of ensuring co-operation between
two countries. The Anglo-French Condominium in Vanuatu was the only time in world history
when Britain and France – traditional enemies – jointly ruled a colony for an extended period.
The French and British governments in Vanuatu were called residencies. The residency
structure emphasized dualism – both consisted of an equal number of French and British
representatives, bureaucrats and administrators. The symmetry between the two residencies was
almost perfect. Each residency provided its own laws, police forces, prisons, currencies, schools,
churches, and hospitals. Visitors could choose which immigration rules to enter under. Nationals
of one country could set up corporations under the laws of the other. Indeed, Port Vila – the
capital of Vanuatu – was divided by the British Paddock area and the French Quarter area
(Figure 1a).
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This paper investigates the economic consequences of Anglo-French condominium in
Vanuatu during the colonial era and the post-colonial era. The unique case of Vanuatu, which
had two governments in the same territory, does not require exogenous variations or instrumental
variables in comparing the British and French colonial legacies. The review of history of
Vanuatu indicates that most political and educational indicators are in favor of Britain (Van
Trease 1987, Miles 1998), but most economic indicators are in favor of France (Neilson 1979).
Britain was more willing to establish self-government in Vanuatu compared to France. However,
the French dominated areas have been more developed than the British dominated areas.
Before independence, the French residency was more effective in developing the
economy than that of the British. For example, 1) the French residency was more willing to and
more effective in validating plantation land titles: before colonization, British planters requested
France to colonize Vanuatu in order to validate their land titles; 2) the French residency imported
Vietnamese indentured laborers facing shortage of labor: a certain number of British planters
registered themselves at the French residency to hire those indentured laborers; 3) the French
residency provided regular steamers to export plantation products: British planters used French
steamers to export their products directly to Europe; 4) the French residency provided the system
of certificate of origin which enabled goods to enter France at preferential tariff: the tax revenue
of French residency was much higher than that of the British due to the fees generated by the
system. 5) a major British Trading company, Burns Philp, formed a French company to conduct
its business. After independence, a cluster of tourism facilities are observed in the former French
concentrated area.
2. Division in Port Vila
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In 1914, Port Vila – the capital of Vanuatu – was roughly divided by the British Paddock
area and the French Quarter area (Figure 1a). The British organized their residency, police
station, jail, hospital, and church in a space known as the British Paddock (Figure 1b). Rodman
(2001, 38) describes that problems of obtaining land and hilly topography above the narrow
coastal shelf did not prevent the British from later organizing their offices and most residencies
in the British Paddock area. Similarly, the French organized their residency, police station, jail,
hospital and church in a space known as French quarter (also called as Latin quarter). The
division of Port Vila is also observed in road names (Figure 1c). Winston Churchill Avenue in
the British Paddock becomes Avenue General De Gaulle in the French Quarter. Furthermore, in
the area where the British residency built houses for their officials, one can observe English road
names such as Cumberland street, York street, Kent street, Gloucester street, Edinburg street, and
Cornwall street. Similarly in the area where the French residency built houses for their officials,
one can observe French road names such as Bougainville street, Pasteur street, Carnot street,
Emile Mercet street, and Fleming street. Finally, 1973 population survey in Port Vila shows that
French nationals were concentrated in the French Quarter and the British nationals were
concentrated in the British Paddock and Iririki Island where the British Resident Commissioner
lived (Figure 1d and Table 1).
After independence, tourism has become the major industry in Vanuatu. Figure 2a and 2b
suggests that the French Quarter is more developed that the British Paddock, which is different
from the expectation of legal origin theory. Arguably, the most important factor of urbanization
and tourism development in an island is the location of a wharf. In most Pacific islands, a city
first develops near the wharf and the wharf area then becomes one of the most developed areas.
In Port Vila, the wharf is located roughly in the boundary between the British Paddock and the
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French Quarter (area 18 in Figure 1d). However, one can easily observe that there are many
tourism facilities in area 15, but few facilities in area 18 (Figure 1d).
3. Choices of Economic Agents in Vanuatu
During the condominium time between 1906 and 1980, two governments had operated
separately and some economic agents could choose between the British common law and the
French civil law. In principle, the British nationals were subjected to the British common law
including contract, corporate, property and criminal law. Similarly, the French nationals were
subjected to the French civil law. However, foreigners in Vanuatu except the British and the
French could choose between the common law and the civil law. There were British customs and
French customs at the airport. If a person chose the British custom, then the person was subject
to the British common law and vice versa.1 Moreover, under some special circumstances, for
example people who had a British father and a French mother, could choose between the
common law and the civil law. Those people who chose the law were called ‘optants’.
The behavior of ‘optants’ suggests that the French economic policies were more effective
than those of the British. The choice of the British planters that opted to the French residency is
the most illustrative.
After the 1914-1918 War, there was a critical shortage of labor, which led the
French Government to bring in Tonkinese workers from North Vietnam, but only
French settlers or French ressortissants could benefit from this manna. This
circumstance caused a certain number of British settlers to register themselves, by
virtue of what must have been an extremely complicated procedure, at the French
Residency (Pierre Anthonioz, French Resident Commissioner, 1949-1958).
In 1927, many of the British planters were considering proposals from French
traders, such as Ballands, to turn their plantations into French companies, by
giving five fortieths of the shares in it to Frenchmen, who would then obtain
Tonkinese labour. At least one couple, the Frasers, took French citizenship after
giving evidence to the Commission. Presumably, they were fed up with the
British inaction (Neilson 1979, 57).
1
An American told the author that he chose the French custom when the line of the British custom was long.
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These show that some British nationals chose to register themselves at the French residency to
solve their major economic difficulties through the French economic policies.
In fact, the British planter’s choices were very consistent with economic rationale
throughout the history of Vanuatu. Before the establishment of the condominium, the British
planters – facing the British government was not willing to validate their land titles – requested
to France to colonize Vanuatu in order to validate their land titles securely. Ms. Victoria Seagoe,
who had a British father and a French mother, remembered that her father registered the title of
his plantation under her mother’s name at the French residency, although he registered his
daughters under the British residency to make them British nationals.
Before independence, Anglophones – native people in Vanuatu attended the British
Church, educated by the British, and supported the British residency’s immediate independence
plan – took political dominance. They planned to return all foreigners’ land to ni-Vanuatu
(natives in Vanuatu). In order to protect their properties, the British planters supported
Francophone – ni-Vanuatu attended the French church, educated by the French schools, and
supported the French independence policy that promised gradual independence – political party
with the French planters.
Finally, Mr. Eugene Peacock, an American who planned the biggest investments in the
real estate before independence, chose the civil law. He bought land in Santo island and planned
to sell sub-divisions to investors from Hawaii and Hong Kong.2 Mr. David Hudson, a lawyer
Pistor (2006) argues that the French civil law embraces “socially-conditioned private contracting” in contrast to
common law’s supplement for “unconditioned private contracting.” However, the case of Peacock indicates that the
British Residency in Vanuatu pursued socially-conditioned private contracting by forbidding to sell sub-divisions.
The British residency documents describes that Peocock’s investment plan was denied because “many of the
purchasers committed to long term transactions with the American developers are themselves speculators intent on
high profits at high risk. … As to Peacock and the other developers themselves, they had the arrogance … They
2
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who worked for Eugene Peacock, remembered that Eugene Peacock was more familiar with the
common law, but chose the French civil law mainly because the French residency was more
interested in economic development. Similarly, because French administration of justice was
known to be relatively lax, particularly regarding labor regulations, even Anglophone expatriates
opted for French protection (Miles 1998, 34). Mr. David Hudson, who have practice law in Port
Vila since 1971 and experienced the condominium government, did not remember any
disadvantages of the civil law in Port Vila. As a matter of fact the opposite happened in
Vanuatu. Burns Philp, the major British trading company, formed a French company in 1938 to
conduct its business between Vanuatu and New Caledonia (Neilson 1979, 66). In 1927, a
company named as ‘Hagen Bros.’ registered itself under the French residency.
4. British and French Colonial Economic Policies
Statistics on Vanuatu shows that the French residency was more effective in economic
development than the British residency. The French settlers had exported more agricultural
products and had dominated the economy. The portion of British export was approximated 25%
from 1921 to 1932. However, facing the Great Depression, the portion decreases 14% in 1933,
11% in 1934, 8.5% in 1935, 6.2% in 1936, and 2.3% in 1937 (Colonial Report 1921-1937). The
British residency did not report the portion after 1938. There were more French nationals than
the British nationals, but it is clear that the French dominated the economy even in per capita
basis after 1937.
It should be noted that the British were more influential in Vanuatu in the late nineteenth
centuries. It was the British missionaries who successfully settled in Vanuatu first. The
settlement significantly helped the British traders and planters to set up their trading posts and
gambled for high stakes and they must not win” (Purchase of land by companies based in Hawaii 1967 – 74, FCO
141/13168)
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plantations. By 1882, British interests in Vanuatu were still strongest. The amount of shipping,
trading and recruiting was dominated by the British. The strength of the Presbyterian and
Melanesian missions, who were supported by interests in the Australian colonies, was growing
(Nielson 1979, 9). By 1910, only a few British settlers were making much money. French setters
increased between 1906 and 1910 (MacClancy 1981: 80). In 1922, the British settlers cultivated
36,100 acres and the French settlers cultivated 37,782 acres (1921-2 Colonial Report).
Transportation and labor supply explain the divergence between the French settlers and
the British settlers. British trade is handicapped by the lack of transportation under the British
flag. While the French have regular steamer of Messageries line (1921-2 Colonial Report). All
planters severely suffered from the shortage of labor supply mainly because ni-Vanuatu – who
could obtain foods and housings from their villages without charges – did not want to work in
plantations. Very low copra prices in 1924, 1928-32, and the cyclone in 1934 meant that fewer
laborers could be employed in plantations. However, even in those years the labor supply was
rarely equal to the demand.
Settlers experienced great difficulty in extending their cultivations and in harvesting their
crops. The difficulty, in so far as French settlers were concerned, was solved by the importation
of Indo-Chinese indentured laborers by the French Government in the year 1921. However, the
British government did not introduce any indentured laborers in Vanuatu. British settlers facing
severely shortage of labor disposed their properties to French settlers (1927 Colonial Report).
French land and settlement policies explain the rapid growth of the French settlement in
Vanuatu. The French settlement scheme required less personal capital than that of the British
(MacClancy 1981: 21). Societe Francaise des Noubelles Hebrides (SFNH), the major French
company, claimed a large amount of land and leased the land at low rentals (Neilson 1979, 61).
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In addition, the French government was more willing to validate land titles in disputes in favor of
French settlers.
In the respect of agriculture, the French planters were more diversified than the British
planters. The British planters heavily relied on copra (i.e. coconuts), indeed more than 80%. As a
result, their businesses were very sensitive to copra price. In contrast, the French planters
diversified to cocoa, cotton, coffee, and beef. They relied on copra less (about 40%), thus
relatively less sensitive to copra price. Due to the French exports, Vanuatu attained trade balance
between 1921-1970 (Figure 3), unlike other Pacific islands where imports exceeded exports
(mainly copra) by a large amount. It should be noted that Vanuatu attained trade balance during
the Great Depression. The plummeted export decreased the purchasing power of whole
population of Vanuatu, consequently, the amount of import decreased. In sharp contrast, current
Vanuatu economy heavily relies on the foreign aids which fills the gap of trade imbalance (and
budget deficits) is not able to attain trade balance through a market mechanism which worked
during the Great Depression.
The French economic policies were more effective in the post Great Depression
expansion. The economic downturn did not affect the planters of both nationalities equally. Most
of the British planters depended on low value products such as copra, and the copra price
plummeted during the Depression. The French diversified with coffee and cocoa, which held
their prices better, and commanded a higher value per ton. When prices recovered, the French,
through subsidies on their produce sold in France, were in a better position to employ native
labor. The wages of indentured laborers were guaranteed by the French government. The British,
who had struggled without official assistance through the Depression, were not in a position to
offer higher wage or better conditions and thus could not take the advantages of higher prices as
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readily as the French. At the end of the Depression fixed quotas were created for French produce
from Vanuatu, on the same basis as French colonies. By the end of the Depression, the French
sector of Vanuatu economy was healthy unlike the British economy in the group (Neilson 1979,
32 - 53).
However, after the Great Depression, the French planters faced another problem, the
World War II. After the collapse of France during the World War II, the French planters lost 97%
their export markets, the France and its foreign territories (Position of French in New Hebrides,
FCO 141/13111). Moreover, the French franc became not acceptable in international trades. In
Vanuatu, more than 70% of import came from Australia. In other words, the planters and
retailers in Vanuatu should rely on the foreign currency, Australian dollars. As a result, the
French retailers were no longer able to replenish their stocks.
The British planters and retailers who used British pounds and Australian dollars had
relatively more favorable situation than the French planters and retailers. The British reports
describe that only one British planter requested some help to the British Residency (Position of
French in New Hebrides, FCO 141/13111). The French situation was much worse. The markets
for the French produce having disappeared, French producers are faced with 1) a total
disappearance of their source of income and 2), responsibility for a considerable force of IndoChinese indentured laborers, which they have contracted to pay and support. In other words, the
French planters were virtually bankrupt and the Indo-Chinese laborers became substantial
disadvantage. The British reports also expected that due to the loss of French exporting markets,
the condominium revenue would decrease to 20% level (Position of French in New Hebrides,
FCO 141/13111). The French residency in Vanuatu supported Free French Movement led by de
Gaulle rather than Vichy government that collaborated with Germany. De Gaulle introduced
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new currency only for Vanuatu, although it is difficult to know how effective the policy was.
However, the French planters did survive through the World War II and dominated the economy
again after the World War II.
The budgets of British and French residency illustrate the economy of Vanuatu very
clearly (Table 2). From 1914 to 1925, both Residencies heavily relied on the subsidy from
London and Paris. However, from 1926 to 1930 the French residency was able to increase its tax
revenue through its exports and the system of certificate of origin which enabled goods to enter
French territories at preferential tariff. The system generated far more tax revenue for the French
residency compared to the British residency that collected income tax from small number of
British nationals. Consequently, the French residency’s budges had been more balanced.
However, facing the Great Depression, the exports of Vanuatu plummeted and both
Residencies relied on the subsidies, again. After the Great Depression, the French economy was
healthier than that of the British due to diversification of exporting products. However World
War II stepped in and the French planters lost all their exporting markets. After the World War
II, the French Residency’s tax revenue increases again and the budget became more balanced.
For example between 1948 and 1954, the French tax revenue was 7 – 28 folds higher than that of
the British at the exchange rate of £1=NHF200. The French residency attained more balanced
budget while the British residency faced large deficit that had increased until the independence.
Moreover, the French contribution for the Condominium tax revenue was also much larger.
Needless to say, some French officials argued that the larger contribution illustrates the superior
French system (Miles 1998, 40).
With respect to the company legislation in the 1970s, on the French side company
registration is automatic, provided the conditions in the law are met. On the British applicant for
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a permit to form an incorporated company must submit information on the applicants, the
proposed directors, persons for whom the applicants may be acting as agents or nominees and
other persons who might have interest in the company. In the light of such information, an
application may be rejected; the British residency describes that there is no difficulty as far as
normal legitimate business are concerned, but the residency received some questions about these
additional requirements (Companies legislation including interpretation and appointment
Queen’s Regulations 1970-4, FCO 131/13188).
1973 employment statistics shows that the French companies hired more employees in
industries and the British hired more in public administration (Table 3). It is true that the British
hired more employees in finance, insurance, real estate, and business service area in 1973. This
is consistent with the prediction of the legal origin theory (La Porta et al. 1998, 1999). However,
this is due to the creation of tax heaven in Vanuatu in 1971. One can see that the French hires
more employees in banks (because until 1970 there was only one French bank in Vanuatu), but
the number of employees in other category makes the British hire more employees in finance.
The other category was jobs for operating tax heaven. Similarly, the British hires more
employees in insurance, real estate, and business services. However, some of those employees,
especially the category of business services, were hired for operating tax heaven.
In 1948, the French opened the first bank in Vanuatu, the branch of Bank of Indochina. In
the 1920s, it was envisioned by the French that a surplus of labor and capital from French
Indochina could be used to develop French possession in the Pacific. Branches of Bank of
Indochina were established in Noumea, New Caledonia in 1920, then Port Vila, in 1948. The
establishment of the bank contributed the exchange rate problems in Vanuatu, which had two
currencies – the found and franc. Official and unofficial exchange rates were rarely the same, the
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latter being below that of the former. For example, between 1926 – 34 the official rate for
sterling was £1:124 francs. Unofficially, it fell to £1: 78 francs during the Depression.
Finally, the French had a long history of concern and assistance for their planters. In
response to the plight of their planters, the French did react, unlike the British. The 50%
reduction on customs duties on their goods entering France instituted in 1901, was carried on.
Subsidies were given on produce sold in France by French nationals or companies, and minimum
prices were guaranteed (Neilson 1979, 53). In 1910, the French administration established the
‘Commission Consultative de Interets Economiques Francaise aux Nouvelles Hebrides.’ Made
elective in 1928, this body could consult directly with the Resident Commissioner, who could
present their problems to the Governor in Noumea. In 1927 the French also established the ‘Chef
du Service de la Conlonisation’ to deal with the Indochinese laborers, native labor and land
tenure problems. Both of these services could convey quickly the problems of the planters and
traders, and action could and would be taken. The British had no equivalent offices, all
responsibility of government resting with the Resident Commissioner.
The British government was reluctant to annex Vanuatu in the late nineteenth century. It
is mainly because they thought the island would be an economic liability. The British
government indifferent to the future of Vanuatu and acted solely at the wish of Australian
government and missionaries that did not want the French dominated islands in addition to New
Caledonia (MacClancy 1981, 62; Neilson 1979; Miles 1998, 18). However, in the late 1920s, the
British residency changed its viewpoint. The British colonial report described that “the fertility
of the soil in almost every island of the Group enables most tropical agricultural products to be
grown very easily. The almost entire absence of disease and pests common to other tropical
countries is an important factor in ensuring to the planter the maximum results. The rainfall is
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abundant, and hurricanes are of rare occurrence and are usually confined to a small area. Given
an adequate supply of labor, combined with the wonderful productiveness of the soil, there is no
reason why Vanuatu should not, form an agricultural point of view, become one of the most
important Groups in the Pacific” (1925, 1927 British Colonial Report).
Observing the introduction of indentured Indo-Chinese labor, the British planters wanted
to introduce indentured labors, too. But, working against them were the objections of the
Australian and New Zealand governments to the introduction of Asian laborers near their shores,
the attitude of the Colonial Office to indentures of any kind, and general British bureaucratic
intransigence. All of those combined to over-rule the suggestions of the planters, the willingness
of the local administrators and the recommendations of the special Commissions of 1917 and
1927, which were in favor of indenturing Asians (Neilson 1979, 34).
Different labor policies impacted the expansion of plantations. With depopulation of niVanuatu, more land was available, but fewer laborers were available to work it. For the British
this meant that they needed to trade native’s home produce, which further reduced the native
labor supply. For the French, it allowed an expansion of their economy at the expense of niVanuatu. They had the capital and Asian labor to exploit sparsely populated areas, and if native
labor was needed, their administration unofficially allowed abuses of the labor regulations to
occur, by which they could obtain more recruits (Neilson 1979, 38).
5. Indicators in favor of the Britain
It should be noted that many political indicators are in favor of the British. The British
administration was more concerned for the native inhabitants (Neilson 1979, Van Trease 1987,
Miles 1998). The British residency was more willing to settle the land dispute between niVanuatu and Europeans in favor of ni-Vanuatu (Van Trease 1987). In 1970, a British official
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said that they were ‘trustees for the ni-Vanuatu until they can decide their own political future’
(Neilson 1979, 38). More importantly, the British planned to establish self-government in
Vanuatu although it is partly due to its lack of economic interests and the large budget deficit of
the British residency (Roger du Boulay, British Resident Commissioner 1973-1975; John S.
Champion, British Resident Commissioner 1975-1978 from Tufala Gavman 2002).
The British were more focused on public administration than economic development that
accompanied abuses of native plantation workers. Before 1968, the British (mainly missionaries)
operated more schools and educated more ni-Vanuatu than the French did (Miles 1998, 49).
More British schools meant more Anglophones. After 1968 the French residency expanded its
education system to create more Francophones partly for delaying independence. The number of
French schools increased rapidly and the French schools provided better buildings and teachers.
John S. Champion, British Resident Commissioner, 1975-1978, describes that “some of the
French schools in my time (1975-1978), staffed largely by splendid young expatriate teachers,
who came out to do this work as an alternative to conscript military service3, were much more
impressive than their Anglophone equivalents.” Nearly five times as many teachers in English
medium schools had no formal training compared with French medium teachers (Miles 1998,
50). The gap between the number of students educated by the British and the French almost
diminished before independence, but widened again after independence (Figure 4).
Before independence, Anglophones outnumbered Francophones and took political
dominance. The newly independent government led by Anglophones adopted mainly the
common law in governing the country. However, the common law could not stabilize the rocky
politics generated by the conflicts between Anglophones and Francophones. For example, in the
1980s, President Sokomanu formally dissolved parliament. In due course Prime Minister Lini
3
Having these teachers also allowed the French residency to save some budget on education.
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had President Solomanu under arrest. Sokomanu was sentenced to six years in prison for
incitement to mutiny, seditious conspiracy, and administrating an unlawful oath. On appeal,
however, all convictions were overturned, the appeals court in 1989 citing trial court errors and
insufficient evidence (Miles 1979, 25).
Finally, it is widely agreed that the British labor regulation, which was stricter than that
of the French, protected ni-Vanuatu from abuses in plantations. Managers of plantations gained
a reputation for brutality. Laborers worked long hours and were treated like animals. They were
often not fed on Sundays and were given such small rations the rest of the week that they had to
buy food from the plantation store.
The British missionaries worried about disease, guns, mass removal of labor, and poor
working conditions in plantations. The missionaries went to the Australian colonial parliaments,
and through them, direct to the British government. The British responded with more warships
and men, but the planters moved into areas beyond the reach of the British and the missionaries
(Neilson 1979, 10).
The employment of native laborers in the British plantations was regulated by the
provisions of the Anglo-French Protocol of 1914. In addition, British settlers are bound by
King’s Regulations Numbers 1 of 1913 and 10 of 1926. Their instruments provide adequate
safeguards for employee. King’s Regulation Number 1 restricted the employment of ni-Vanuatu
to Vanuatu and made recruiting licenses mandatory for all professional recruiters. It established
inspections, registrations of workers, minimum wages, hours of work and conditions, and set the
punishments for particular offences. It allowed a recruit to bring his wife and children at the
recruiter’s expense. Employment of young women and children, and women beyond a ten mile
radius from their employment was prohibited. King’s Regulation Number. 10 of 1926 restricted
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female employment to only those who were married, and lessened the effect of some of the more
stringent provisions of the 1913 regulation. The regulations decreased labor supplies and made
hiring ni-Vanuatu costlier. Conditions for ni-Vanuatu improved, while those for the planters
declined (Neilson 1979).
Most English accounts of the early years of the Condominium condemn Frenchmen for
the crimes they committed. However, it is highly important to remember, though, that several
French plantations were managed by Englishmen and if recruiting abuses or acts of brutality
were committed by both nationals, the actions of the French would have been more obvious
simply because they were more of them. One English planter of the time thought that “the British
are only slightly better than the French” (MacClancy 1981: 81).4
6. Comparison of Santo and Tanna
It is widely agreed that the French influence was strong in Santo island and the British
influence was strong in Tanna island. Some economic characteristics of those islands are similar,
making them comparable. First of all, populations of both islands in 1967 were similar (Santo:
9,630, Tanna: 10,473). Second, both of them are popular tourist destinations in Vanuatu
(arguably, Tanna is more popular destination than Santo because the island has a live volcano).
Finally, both island experienced rebellions against independence, the most critical political
turbulence throughout the Vanuatu history. The independence rebellion was bigger in Santo than
that of Tanna, consequently, the economic punishment after independence was harsher in Santo
than Tanna.
4
Indeed, it is not very difficult to find unfavorable British policy in other places. For example, in Trinidad, artisans
and students who under Spanish law could not have their tools or books seized for debts. However, after the British
occupation, they lost these protections in the 1840s. Moreover, the British also introduced policies to give the British
planter class more laborers at lower wages from Africa and India (Campbell 1975).
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Of course, not all economic conditions are the same. Santo is bigger than Tanna, thus
population density of Tanna was higher than Santo in 1967. The cultures of those islands are also
different, although both islands share Melanesian culture. Arguably, the biggest difference is the
degree of urbanization. During World War II, the US made a base in Santo and later, the base
has developed into the second largest city in Vanuatu, Luganville. After independence, Vanuatu
government collects statistics of Luganville and rural area of Santo separately. In summary,
although there are some differences, the rural area of Santo and Tanna might be comparable. Or
those two islands are more comparable than India and Indo China, Ghana and Guenea (the
countries that attained the first independence from Britain and France in Africa) or the British
Cameroon and the French Cameroon (the French Cameroon was much bigger than the British
Cameroon) (Miles 1998, 31).
In Santo, there were many French planters, the most important group within the French
settlers (Pierre Anthonioz from Tufala Gavman 2002: 77). British officials in Santo islands also
agreed the French dominance in the island (Tufala Gavman 2002: 233). The French residency
opened a hospital and the Bank of Indo-China opened a branch in Santo. In Tanna, there were
many British missionaries, the most important group within the British settlers. There was no
French settler in 1934 and no French co-operative until 1968 (Colonial Report 1934, Andre
Pouilet from Tufala Gavman 2002: 404). The British opened a hospital and Australian banks
had an agency in Tanna.
The missionaries owned an anti-French bias and a dislike of the recruiters and planters,
who were seen as intruders on Tanna. Feeling against the French found expression in other ways.
The Pacific Islands Monthly reported that native on Tanna had refused to cooperate with a
18
French trader, and on Tanna only, no French plantation were established. Nor were the French
involved there in permanent trading operations until 1968 (Neilson 1979, 40).
Statistics show that the rural area of Santo is more developed than Tanna (Table 4).
Average household income of the rural area of Santo is higher than that of Tanna. Mobile phone,
computer, television, radio, and telephone ownership rate are higher in Santo. Population, which
is used a proxy of economic development in domestic level (Alesiana et al. 2005), is also larger
in Santo and the population has increased faster in the rural area of Santo than Tanna. Bastion
(1981) reports that the lack of plantation discouraged the spread of the concept of wage labor in
Tanna and mixed the entrepreneurship with the traditional structures; thus a business became less
effective in European perspectives.
The British missionaries were used to encourage the development of native land by the
native themselves, and for a time were able to halt all recruiting from the island for plantations
on other islands. As a model to the Melanesians, and for their own income, they also established
their own plantations (Neilson 1979, 40). However, these politically sound ideas did not work as
it planned. First, it heavily relied on copra. Second, de Burlo (1983) reports that the missionarystyle development plan did not work effectively mainly because the land was owned collectively.
The collective ownership generated incentive issues between the ni-Vanuatu. It also generated a
management issues in developing tourism facilities. Ni-Vanuatu who owned the land regarded
the resort as their property and used it at their convenience. Tourists complained about the
problem, but the management had difficulties in resolving the problems.
7. Conclusion
In Vanuatu, most economic indicators are in favor of the French. The heavy handed
French economic policy is considered to be inefficient (La Porta et al. 2008), but the case of
19
Vanuatu suggests that it might be more efficient if it operates properly. Indeed, providing regular
steamers, importing indentured labors, opening a bank, and generating more tax revenue did
contribute solving major economic difficulties in Vanuatu. The relatively effective heavy handed
governments are also observed in South Korea and Singapore (maybe in Germany and Japan as
well). The French concentrated area in Port Vila is more developed than the British concentrated
area. Santo where the French influence is stronger is more developed than Tanna where the
British influence is stronger. The choices of economic agents also suggest that the French
economic policy was more effective. The major British trading company established a company
under the French law and a certain number of British planters registered themselves in the
French residency.
It is true that most political indicators are in favor of the British. The British educated
more ni-Vanuatu and provided plans for immediate independence. However, the rocky political
history of Vanuatu after independence suggests that the British political system was not able to
contribute stable politics, and possibly the economic development, either. It may be argued that
the French economic policies worked as an advantage for French planters, not for ni-Vanuatu.
However, providing transportations, balanced trade, and more balanced government budget were
very likely to be public goods. As a matter of fact, many Pacific islands suffer from lack of
transportations, trade imbalance, and substantial budget deficits. Nowadays, many Pacific islands
including Vanuatu heavily rely on foreign aids which fill out the budget deficits and trade
imbalances. Relying on the foreign aid, indeed, discourages the operation of market economy.
The case of Vanuatu – although this quasi-experiment that does not require exogenous
variations or instrumental variables may not hold in other places – is consistent with the studies
20
that argue the impacts of legal origins may not be significant when other factors are properly
controlled (Acemoglu et al. 2001).
References
Acemoglu, Daron, Simon Johnson, and James A. Robinson. 2001. The Colonial Origins of
Comparative Development: An Empirical Investigation. The American Economic Review
91 (5):1369-1401.
Banerjee, Abhijit, and Lakshmi Iyer. 2005. History, Institutions, and Economic Performance:
The Legacy of Colonial Land Tenure Systems in India. The American Economic Review
95 (4):1190-1213.
Bastin, Ron. 1981. Economic Enterprise in a Tannese Village. In Vanuatu: Politics, Economics
and Ritual in Island Melanesia, edited by M. Allen. Sydney: Academin Press.
Bresnihan, Brian J., and Keith Woodward. 2002. Tufala Gavman: Reminiscences from the
Anglo-French Condominium of New Hebrides. Fiji: Institute of Pacific Studies University
of South Pacific.
Engerman, Stanley L., and Kenneth L. Sokoloff. 2002. Factor Endowment, Institutions, and
Differential Paths of Growth Among New World Economies: A View from Economic
Historians of the United States. In How Latin American Fell Behind, edited by S. Harber.
Stanford: Stanford University Press.
Hayek, F. 1960. The Constitution of Liberty. Chicago: University of Chicago Press.
La Porta, Rafael, Florencio Lopez-De-Silanes, and Andrei Shleifer. 2008. The Economic
Consequences of Legal Origins. Journal of Economic Literature 46 (2):285-332.
La Porta, Rafael, Florencio Lopez-De-Silanes, Andrei Shleifer, and Robert W. Vishny. 1997.
Legal Determinants of External Finance. The Journal of Finance 52 (3):1131-1150.
La Porta, Rafael, Florencio Lopez-de-Silanes, Andrei Shleifer, and Robert W. Vishny. 1998.
Law and Finance. The Journal of Political Economy 106 (6):1113-1155.
Lee, Alexander, and Kenneth Schultz. 2009. Comparing British and French Colonial Legacies: A
Discontinuity Analysis of Cameroon.
Lipset, Seymour Martin. 1994. The Social Requisites of Democracy Revisited: 1993 Presidential
Address. American Sociological Review 59 (1):1-22.
MacClancy, Jeremy. 1981. To Kill a Bird with Two Stones: A Short History of Vanuatu. Port
Vila: Imprimerie SOCOM.
Miles, William. 1998. Bridging Mental Boundaries in a Postcolonial Microcosm. Honolulu:
University of Hawaii Press.
Neilson, David John. 1979. Might or Misery?: British Planters in the New Hebrides 1920-40,
History, University of Auckland, Auckland.
New Hebrides, British Service. 1921 - 1972. Colonial Reports, New Hebrides. London: His
Majesty's Stationery Office.
New Hebrides, British Service. 1940. Position of French in New Hebrides, FCO 141/13111.
New Hebrides, British Service. 1970-4. Companies legislation including interpretation and
appointment Queen’s Regulations 1970-4, FCO 131/13188
21
New Hebrides, Condominium. 1972. Census of Population and Housing: Vila and Santo. Port
Vila: Statistical Bulletin.
———. 1975. Manpower and Employment Survey. Port Vila: Statistical Bulletin.
———. 1979, 2009. Census on Population and Housing. Port Vila: Statistical Bulletin.
Noumea, Imprimerie Nationale. 1919 – 1954, Budget Special des Nouvelles-Hebrides.
Nunn, Nathan. 2008. The Long-Term Effect of Africa's Slave Trades. The Quarterly Journal of
Economics 123 (1):139-176.
Rodmand, Margaret Critichlow. 2001. Houses Far from Home: British Colonial Space in the
New Hebrides. Honolulu: University of Hawaii Press.
Simeoni, Patricia. 2009. Atlas du Vanouatou. Port Vila: Vanouatou Geo-Consulte.
Van Trease, Howard. 1987. The Politics of Land in Vanuatu: From Colony to Independence.
Fiji: Institute of Pacific Studies of University of the South Pacific.
Vanuatu, Government. 2006, 2009. Household Income and Expenditure Survey. Port Vila.
22
Figure 1a. British Paddock and Quartier francais
Source. Simeoni (2009)
23
Figure 1b. Buildings in the British Paddock and the French Quarter in 1926
Source: Rodman (2001, 37)
Note. Gray squares denotes Condominium buildings that were built in the relatively neutral area.
24
Figure 1c. Road names in the British Paddock and the French Quarter
Source: Google map / Additional road names from Vanuatu Photo map.
Note: Not all road names are available in google map. The road names of google map are slightly
different from those of the Vanuatu Photo map. For example, Rue Edinburgh in google map is
denoted as Edinburgh Street in Vanuatu Photo map.
25
Figure 1d. Enumerator’s Area in 1973 Population Survey in Port Vila
Source: 1973 Population Survey in Port Vila.
26
Figure 2a. Vanuatu Tourism, Port Vila Map I
Note. The scale of this sketch map does not match exactly with the actual map.
27
Figure 2b. Vanuatu Tourism, Port Vila Map II
Note. The scale of this sketch map does not match exactly with the actual map
28
Figure 3. Export and Import of Vanuatu 1920-1970
7000000
6000000
5000000
4000000
Export
3000000
Import
2000000
1000000
1921
1923
1925
1927
1929
1931
1933
1935
1937
1945
1947
1949
1951
1953
1955
1957
1959
1961
1963
1965
1967
1969
0
The export and import is measured in the British pound sterling.
Source. Colonial Reports 1921-1970
29
Note.
Figure 4. Primary school enrollment in Vanuatu, 1971 - 1990
Source: Miles (1998, 49)
30
Table 1. 1972 Population Survey in Port Vila, Vanuatu
Enumerator’s Area British Nationals
French Nationals
11
16
89
12
60
195
13
27
57
14
46
199
15
63
115
16
92
149
17
23
144
18
40
39
19
102
16
20
172
47
21
33
49
22
38
46
23
23
0
24
84
102
25
120
220
26
47
142
28
6
22
Total
992
1631
British or French dominated
French
French
French
French
French
French
French
British
British
British
French
French
British
French
French
French
French
Source: Census of Population and Housing: Vila and Santo (1972)
31
Table 2. The budget of British and French Residency 1914-1958
Year
1914
1915
1916
1917
1918
1919
1920
1921
1922
1923
1924
1925
1926
1927
1928
1929
1930
1931
1932
1933
1934
1935
1936
1937
1938
1939
1948
1949
1950
1951
1952
1953
1954
1955
1956
1957
1958
Budget Total
436000
425100
425100
419300
422650
413150
604150
553650
487700
637700
654600
789850
2097000
2274600
3978000
2935000
3078700
6547700
5659000
6782600
6710100
5277700
4618500
4369426
4958500
4748895
19536600
27425225
87328800
22847974
22545000
29593125
27667000
France
Subsidy*
350000
350000
350000
350000
350000
350000
350000
315000
315000
500000
500000
600000
650000
800000
2500000
1500000
1500000
5160000
5060000
5343000
6047500
4450000
3444000
3503826
3786950
3599750
16650000
24364765
78891440
11547675
12000000
13084107
13636000
Subsidy/Total
Budget Total
0.80
0.82
0.82
0.83
0.83
0.85
0.58
0.57
0.65
0.78
0.76
0.76
0.31
0.35
0.63
0.51
0.49
0.79
0.89
0.79
0.90
0.84
0.75
0.80
0.76
0.76
0.85
0.89
0.90
0.51
0.53
0.44
0.49
Britain
Revenue
400
448
562
569
499
487
Revenue/Total
7506
12262
8685
12354
12254
13601
16123
15693
16408
11966
9506
10314
9540
9106
8615
9346
9422
9586
9453
9187
0.05
0.04
0.06
0.05
0.04
0.04
100**
100**
100**
100**
100**
100**
100**
100**
100**
100**
100**
100**
29225
2691
0.09
43152
45242
55983
65591
74294
86963
90853
86904
116594
1824
3312
2480
5878
9994
2740
2768
2849
3930
0.04
0.07
0.04
0.09
0.13
0.03
0.03
0.03
0.03
Note. * Ordinary subsidy only. This amount excludes subsidy to hospital (which were relatively
small) and extraordinary subsidy (which were borrowed and paid back to the Bank of Indo-China
in the same year).
** Certain miscellaneous receipts, such as Court fees and fines, and rent, totaling about a
hundred pounds annually.
Source: British Colonial Reports (1921-1958). Budget Special des Nouvelles Hebrides (1920 –
1954).
32
Table 3. Employed persons classified by legal jurisdiction
Industry
Public Administration Total
Public order and safety
Economic services
Other
Social and related community services Total
Education services
Health services
Sanitary and other services
Recreational and cultural, personal and household services
Motor vehicle repairs by non-retailers
Other
Forestry, fishing, mining and quarrying
Manufacturing, electricity and water
Construction
Wholesale and retail trade, restaurants and hotels Total
Wholesale
Retail
Restaurants, bars, etc
Hotels, etc
Transport, storage and communication Total
Road transport
Shipping, air transport and transport services
Communication
Financing, insurance, real estate and business services Total
Banks
Other
Insurance, real estate, business services
Total
Source. Manpower and Employment Survey (1975)
33
British French
261
270
102
86
49
44
113
143
1240
937
773
729
338
174
129
34
52
103
14
69
38
34
126
240
82
282
504
758
775
801
69
50
659
459
20
87
27
205
125
306
24
37
101
268
1
199
142
55
77
38
106
65
3364
3839
Table 4. Comparison of Santo and Tanna
Santo
Tanna
Vanuatu
Luganville
Rural
Population
1967
9630
10473
76511
1979
15959
13260
109425
1999
10738
20162
25840
146584
2009
13167
26439
28799
176816
Luganville
Sanma* (Rural)
Tafea*
Vanuatu
Average
64200
53100
43700
60700
Household
Rural: 53500
Urban: 93400
income in 2006
(Unit: Vatu)
Sanma*
Tafea*
Vanuatu
Household heads
who own
Mobile phones
7425
3705
35900
Computers
485
170
3709
Television
3355
1098
17636
Radio
3572
1033
16499
Telephone
234
89
1916
Note. Sanma district includes Santo and other small islands. Tafea district includes Tanna and
other small islands.
Source. Census on population and housing 1979, 2009. Household Income and Expenditure
Survey 2006, 2009.
34