Sasha Petrov

National border configurations significantly affect welfare: they govern trading opportunities and eligibility for public services. Empirical evidence suggests that postcolonial border design has harmed Africa's long-term development through these two channels. This paper offers a spatial model of borders that evaluates welfare consequences through trade and the provision of public goods. This model features four key forces: the benefits of economic and fiscal integration weighed against the costs of preference heterogeneity and span of control. To evaluate the inefficiencies of border configurations, I set up an optimal borders problem to balance the trade-off between these forces and develop a decomposition method to solve it. I calibrate the parameters of the spatial model and use the proposed decomposition method to solve the optimal borders problem in the African context. With optimal borders, Africa could gain at least 28% in welfare. The primary shortcoming of the current borders is their geographic position, not the number of countries.