IDEAS home Printed from https://ideas.repec.org/p/col/000089/020105.html
   My bibliography  Save this paper

Constructive extraction? Encomienda, the colonial state, and development in Colombia

Author

Listed:
  • Jean-Paul Faguet
  • Camilo Matajira
  • Fabio Sánchez-Torres

Abstract

The Spanish encomienda, a colonial forced-labor institution that lasted three centuries, killed many indigenous people and caused others to flee into nomadism. And yet we show that Colombian municipalities with encomiendas in 1560 enjoy better outcomes today across multiple dimensions of development compared to those without: higher municipal GDP per capita, tax receipts, and secondary school enrolments; lower infant mortality and unsatisfied basic needs; larger populations; and superior fiscal performance and tax collection efficiency. Why? A mediation exercise using data on local institutions in 1794 shows that encomiendas affected development overwhelmingly by helping build the local state. Detailed historical evidence shows when and how encomenderos founded local institutions early on in places where they settled. Places lacking encomiendas also lacked local states for up to 300 years. These institutions mobilized public investment in ways that doubtless suited encomenderos, but over time spurred greater economic and human development.

Suggested Citation

  • Jean-Paul Faguet & Camilo Matajira & Fabio Sánchez-Torres, 2022. "Constructive extraction? Encomienda, the colonial state, and development in Colombia," Documentos CEDE 20105, Universidad de los Andes, Facultad de Economía, CEDE.
    • Handle: RePEc:col:000089:020105
    as

    Download full text from publisher

    File URL: https://repositorio.uniandes.edu.co/bitstream/handle/1992/57243/dcede2022-12.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Yeager, Timothy J., 1995. "Encomienda or Slavery? The Spanish Crown's Choice of Labor Organization in Sixteenth-Century Spanish America," The Journal of Economic History, Cambridge University Press, vol. 55(4), pages 842-859, December.
    2. Sascha O. Becker & Ludger Woessmann, 2009. "Was Weber Wrong? A Human Capital Theory of Protestant Economic History," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(2), pages 531-596.
    3. William F. Maloney & Felipe Valencia Caicedo, 2016. "The Persistence of (Subnational) Fortune," Economic Journal, Royal Economic Society, vol. 126(598), pages 2363-2401, December.
    4. van Waijenburg, Marlous, 2018. "Financing the African Colonial State: The Revenue Imperative and Forced Labor," The Journal of Economic History, Cambridge University Press, vol. 78(1), pages 40-80, March.
    5. José Garcia Montalvo & Marta Reynal-Querol, 2020. "Colonization, early settlers and development: The case of Latin America," Economics Working Papers 1729, Department of Economics and Business, Universitat Pompeu Fabra.
    6. Stelios Michalopoulos & Elias Papaioannou, 2013. "Pre‐Colonial Ethnic Institutions and Contemporary African Development," Econometrica, Econometric Society, vol. 81(1), pages 113-152, January.
    7. Summerhill, William, 2010. "Colonial Institutions, Slavery, Inequality, and Development: Evidence from São Paulo, Brazil," MPRA Paper 22162, University Library of Munich, Germany.
    8. Camilo García Jimeno, 2005. "Colonial Institutions And Long-Run Economic Performance In Colombia: Is There Evidence Of Persistence?," Documentos CEDE 2152, Universidad de los Andes, Facultad de Economía, CEDE.
    9. William Easterly & Ross Levine, 2016. "The European origins of economic development," Journal of Economic Growth, Springer, vol. 21(3), pages 225-257, September.
    10. Stanley L. Engerman & Kenneth Lee Sokoloff, 2002. "Factor Endowments, Inequality, and Paths of Development Among New World Economies," Economía Journal, The Latin American and Caribbean Economic Association - LACEA, vol. 0(Fall 2002), pages 41-110, August.
    11. Nathan Nunn & Diego Puga, 2012. "Ruggedness: The Blessing of Bad Geography in Africa," The Review of Economics and Statistics, MIT Press, vol. 94(1), pages 20-36, February.
    12. Sara Lowes & Eduardo Montero, 2021. "Concessions, Violence, and Indirect Rule: Evidence from the Congo Free State," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 136(4), pages 2047-2091.
    13. Ronald Batchelder & Nicolas Sanchez, 2013. "The encomienda and the optimizing imperialist: an interpretation of Spanish imperialism in the Americas," Public Choice, Springer, vol. 156(1), pages 45-60, July.
    14. Parent, Antoine, 2018. "Introduction to the Special Issue on colonial institutions and African development," Journal of Institutional Economics, Cambridge University Press, vol. 14(2), pages 197-205, April.
    15. Reynal-Querol, Marta & García-Montalvo, José, 2020. "Colonization, Early Settlers and Development: The Case of Latin America," CEPR Discussion Papers 15020, C.E.P.R. Discussion Papers.
    16. Kenneth L. Sokoloff & Stanley L. Engerman, 2000. "Institutions, Factor Endowments, and Paths of Development in the New World," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 217-232, Summer.
    17. Nathan Nunn, 2008. "The Long-term Effects of Africa's Slave Trades," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 123(1), pages 139-176.
    18. Timothy Besley & Torsten Persson, 2011. "Pillars of Prosperity: The Political Economics of Development Clusters," Economics Books, Princeton University Press, edition 1, number 9624.
    19. Abad, Leticia Arroyo & van Zanden, Jan Luiten, 2016. "Growth under Extractive Institutions? Latin American Per Capita GDP in Colonial Times," The Journal of Economic History, Cambridge University Press, vol. 76(4), pages 1182-1215, December.
    20. Melissa Dell & Benjamin A Olken, 2020. "The Development Effects of the Extractive Colonial Economy: The Dutch Cultivation System in Java," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 87(1), pages 164-203.
    21. Laura Cepeda Emiliani & Adolfo Meisel Roca, 2014. "¿Habrá una segunda oportunidad sobre la tierra? Instituciones coloniales y disparidades económicas regionales en Colombia," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 16(31), pages 287-310, July-Dece.
    22. José García-Montalvo & Marta Reynal-Querol, 2020. "Colonization, Early Settlers and Development: The Case of Latin America," Working Papers 1189, Barcelona School of Economics.
    23. Lakshmi Iyer, 2010. "Direct versus Indirect Colonial Rule in India: Long-Term Consequences," The Review of Economics and Statistics, MIT Press, vol. 92(4), pages 693-713, November.
    24. Johan Fourie & Dieter Fintel, 2014. "Settler skills and colonial development: the Huguenot wine-makers in eighteenth-century Dutch South Africa," Economic History Review, Economic History Society, vol. 67(4), pages 932-963, November.
    25. Salomón Kalmanovitz, 2006. "El PIB de la Nueva Granada en 1800: auge colonial, estancamiento republicano," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 8(15), pages 161-183, July-Dece.
    26. Pranab Bardhan, 2016. "State and Development: The Need for a Reappraisal of the Current Literature," Journal of Economic Literature, American Economic Association, vol. 54(3), pages 862-892, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Eslava, Francisco & Valencia Caicedo, Felipe, 2023. "Origins of Latin American inequality," LSE Research Online Documents on Economics 119763, London School of Economics and Political Science, LSE Library.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nunn, Nathan, 2014. "Historical Development," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 7, pages 347-402, Elsevier.
    2. Stelios Michalopoulos & Elias Papaioannou, 2020. "Historical Legacies and African Development," Journal of Economic Literature, American Economic Association, vol. 58(1), pages 53-128, March.
    3. Leonardo M. Klüppel & Lamar Pierce & Jason A. Snyder, 2018. "Perspective—The Deep Historical Roots of Organization and Strategy: Traumatic Shocks, Culture, and Institutions," Organization Science, INFORMS, vol. 29(4), pages 702-721, August.
    4. Liu, Xianda & Hou, Wenxuan & Main, Brian G.M., 2022. "Anti-market sentiment and corporate social responsibility: Evidence from anti-Jewish pogroms," Journal of Corporate Finance, Elsevier, vol. 76(C).
    5. Merima Ali & Odd-Helge Fjeldstad & Boqian Jiang & Abdulaziz B Shifa, 2019. "Colonial Legacy, State-building and the Salience of Ethnicity in Sub-Saharan Africa," The Economic Journal, Royal Economic Society, vol. 129(619), pages 1048-1081.
    6. Daniel Oto-Peralías & Diego Romero-Ávila, 2016. "The economic consequences of the Spanish Reconquest: the long-term effects of Medieval conquest and colonization," Journal of Economic Growth, Springer, vol. 21(4), pages 409-464, December.
    7. Jean-Paul Faguet & Camilo Matajira & Fabio Sánchez, 2017. "Is Extraction Bad? Encomienda and Development in Colombia since 1560," Documentos CEDE 15668, Universidad de los Andes, Facultad de Economía, CEDE.
    8. Fenske, James & Wang, Shizhuo, 2023. "Tradition and mortality: Evidence from twin infanticide in Africa," Journal of Development Economics, Elsevier, vol. 163(C).
    9. Long, Cheryl & Murrell, Peter & Yang, Li, 2019. "Memories of colonial law: The inheritance of human capital and the location of joint ventures in early-reform China," China Economic Review, Elsevier, vol. 58(C).
    10. Stelios Michalopoulos & Elias Papaioannou, 2016. "The Long-Run Effects of the Scramble for Africa," American Economic Review, American Economic Association, vol. 106(7), pages 1802-1848, July.
    11. Remi Jedwab & Felix Meier zu Selhausen & Alexander Moradi, 2022. "The economics of missionary expansion: evidence from Africa and implications for development," Journal of Economic Growth, Springer, vol. 27(2), pages 149-192, June.
    12. James B. Ang & Per G. Fredriksson, 2017. "Statehood Experience, Legal Traditions, And Climate Change Policies," Economic Inquiry, Western Economic Association International, vol. 55(3), pages 1511-1537, July.
    13. Maseland, Robbert, 2021. "Contingent determinants," Journal of Development Economics, Elsevier, vol. 151(C).
    14. Besley, Timothy & Reynal-Querol, Marta, 2014. "The Legacy of Historical Conflict: Evidence from Africa," American Political Science Review, Cambridge University Press, vol. 108(2), pages 319-336, May.
    15. James Fenske, 2014. "Ecology, Trade, And States In Pre-Colonial Africa," Journal of the European Economic Association, European Economic Association, vol. 12(3), pages 612-640, June.
    16. Chaudhary, Latika & Rubin, Jared & Iyer, Sriya & Shrivastava, Anand, 2020. "Culture and colonial legacy: Evidence from public goods games," Journal of Economic Behavior & Organization, Elsevier, vol. 173(C), pages 107-129.
    17. Bolt, Jutta & Gardner, Leigh, 2019. "African institutions under colonial rule," CEPR Discussion Papers 14198, C.E.P.R. Discussion Papers.
    18. Bezemer, Dirk & Bolt, Jutta & Lensink, Robert, 2014. "Slavery, Statehood, and Economic Development in Sub-Saharan Africa," World Development, Elsevier, vol. 57(C), pages 148-163.
    19. Paola Giuliano & Nathan Nunn, 2013. "The Transmission of Democracy: From the Village to the Nation-State," American Economic Review, American Economic Association, vol. 103(3), pages 86-92, May.
    20. Evan Wigton-Jones, 2020. "Legacies of inequality: the case of Brazil," Journal of Economic Growth, Springer, vol. 25(4), pages 455-501, December.

    More about this item

    Keywords

    EncomiendaForced laborState capacityExtractionColonialismDevelopmentColombia;

    JEL classification:

    • H7 - Public Economics - - State and Local Government; Intergovernmental Relations
    • N36 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Latin America; Caribbean
    • N96 - Economic History - - Regional and Urban History - - - Latin America; Caribbean
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:col:000089:020105. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Universidad De Los Andes-Cede (email available below). General contact details of provider: https://edirc.repec.org/data/ceandco.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.