A stakeholder empire: the political economy of Spanish imperial rule in America
AbstractThis paper revises the traditional view of Spain as a predatory colonial state that extracted revenue from natural resources and populations in the Americas while offering little in return. Using 18th century Spanish American treasury accounts we show that local elites not only exerted important control over revenue collection as argued by (Irigoin/Grafe 2006) but also over expenditure allocation. Mirroring Elliot’s characterization of the English empire as a ‘stakeholder empire’ we contend that the Spanish colonial state developed into a stakeholder model, in which local interests were deeply invested in the survival and expansion of empire. The means of co-optation were intra-colonial transfers, as well as credit relations between the state and colonial individuals and corporations, which guaranteed that much of colonial revenue was immediately fed back into the local economy, while minimizing enforcements costs. By allowing stakeholder control of both revenue and expenditure Spain managed to avoid the problems faced by France where royal control of expenditure clashed with at least partial elite control of revenue raising (Velde/Weir 1992, Hoffman/Rosenthal 1997).
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Bibliographic InfoPaper provided by London School of Economics and Political Science, Department of Economic History in its series Economic History Working Papers with number 22306.
Length: 60 pages
Date of creation: Nov 2008
Date of revision:
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- Regina Grafe & Alejandra Irigoin, 2012. "A stakeholder empire: the political economy of Spanish imperial rule in America," Economic History Review, Economic History Society, vol. 65(2), pages 609-651, 05.
- N0 - Economic History - - General
- O52 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Europe
- H83 - Public Economics - - Miscellaneous Issues - - - Public Administration
- O51 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada
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- Irigoin, A & Grafe, R, 2012. "Bounded Leviathan: or why North & Weingast are only right on the right half," MPRA Paper 39722, University Library of Munich, Germany.
- Kendrick, Neil, 2013. "Educação para todos –“free to those who can afford it”: human capital and inequality persistence in 21st c Brazil," MPRA Paper 49531, University Library of Munich, Germany.
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