Historical Perspective on Zimbabwe’s Economic Performance: A Tale of Five Lost Decades

• Published in: Journal of developing societies 2010-03, Vol.26 (1), p.99-123
• Main Author: Makina, Daniel
• Format: Article
• Language: English
• Subjects: Central banks; Currency instability; Deregulation; Economic crisis; Economic models; Foreign exchange; Governance; Hyperinflation; Independence; Liberalization; Macroeconomics; Monetary policy; Political economy; Sanctions; South Africa; Zimbabwe
• ISSN: 0169-796X; 1745-2546
• DOI: 10.1177/0169796X1002600105

The paper presents a chronological unravelling of the political economy of Zimbabwe. It commences by giving an analysis of economic performance within a framework of four periods, namely, (i) the pre-independence period, (ii) the post-independence period of controls, (iii) the economic liberalization period and (iv) the economic crisis period. It proceeds to discuss the deterioration in economic performance emanating from inappropriate macroeconomic policies followed post-independence. The role of the monetary policy regime in exacer-bating macroeconomic instability is also highlighted. Furthermore, the system of governance is noted to be another significant contributory factor to economic decline. One important insight from the analysis is that the economy had been operating sub-optimally throughout the post-independence period, a factor which is often ignored in research on Zimbabwe. Furthermore, if we take into account the lacklustre performance during the pre-independence period when it was under international sanctions, Zimbabwe could be said to have had ‘five lost decades’ –the 1960s, the 1970s, the 1980s, the 1990s and the decade commencing in the year 2000.