African regions that suffered the highest levels of slave extraction centuries ago have companies that are significantly less likely to innovate today.
April 23, 2026
Original Paper
In the Shadow of History: The Enduring impact of the African Slave Trade on Corporate Innovation
SSRN · 6624969
The Takeaway
Historical trauma from the African slave trade continues to suppress the economic creativity of modern firms in the affected regions. This legacy eroded long-term orientation and trust in scientific progress among the local populations. Economists often assume that current business performance is a result of modern policies or infrastructure. This research proves that a social shock from hundreds of years ago can still actively stifle the technological growth of a company. It means that economic development requires addressing deep-seated historical scars that go far beyond simple financial investment.
From the abstract
A growing stream of research investigates how institutional environments shape corporate behavior, yet the deep historical origins of these institutions remain underexplored. We address this gap by theorizing that traumatic historical shocks can leave enduring cultural imprints that continue to influence firm decisions. Drawing on data from 32 African countries, we find that firms are significantly less likely to engage in innovation in regions that experienced higher levels of slave extraction