Tax Me If You Can: Ethnic Geography, Democracy, and the Taxation of Agriculture in Africa

Abstract

It is typically assumed that African leaders enact policies that benefit their ethnoregional group using all types of patronage. Crop production and political power are geographically concentrated in many African countries, and this paper exploits this overlap to cast doubt on this conventional wisdom. It shows, using data on 50 country-crop combinations, that cash crop farmers who are ethnically identified with the head of state facehighertaxes. Furthermore, democratic regimes impose lower taxes. This paper shows that farmers who have few alternatives face higher taxes. African leaders have used local intermediaries to exert control over the countryside and to ensure that farmers do not support alternative candidates. It suggests that as leaders are better at selecting and monitoring these intermediaries in their home areas, they can extract more from the majority at home than abroad using taxes on cash crops, which are regionally but not individually targetable.