The curious case of domestic capitalists in Africa: towards a political economy of diversified business groups

Existing models of capitalist transformation have nearly always prioritised an analysis of domestic capital in shaping economic trajectories. Yet, even as industrial policy has been re-imagined in Africa, the potential contribution of domestic capital has remained marginal in academic analysis and policy discussions. The prevailing assumptions are that African capital is either non-existent or too weak to influence the policies of African governments. However, there is evidence within nascent literature that large African-owned businesses continue to influence the trajectory of capitalist transformation within their countries. This paper examines why the study of African capitalists - popular in the 1980s and 1990s - has remained dormant. This paper makes the case for analysing the politics driving the activity of large African-owned firms through researching the politics of diversified business groups (DBGs). Arguing that DBGs are the predominant form that large-scale domestic investment takes on the continent, the paper introduces an inductively-informed typology of African DBGs. The framework shows how domestic political economy (and the politics of state-business relations, in particular) shapes the form and trajectories of diversification of domestic business groups.