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Is Extraction Bad? Encomienda and Development in Colombia since 1560

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  • Jean-Paul Faguet
  • Camilo Matajira
  • Fabio Sánchez

Abstract

We explore the impact of encomienda, a forced-labor institution imposed by the Spanish throughout Latin America during three centuries, on long-term development outcomes in Colombia. Despite being a classically extractive institution, municipalities that had encomiendas in 1560 have higher development indicators than otherwise-similar, neighboring municipalities without. Encomienda is associated with higher municipal GDP/capita, lower poverty and infant mortality, and higher secondary school enrolments today. Further probing implies a mechanism by which encomenderos founded the local state in the colonial territories they dominated. This stronger local state persisted through Colombia’s war of independence and the chronic instability of the early republic. It mobilized resources and invested in public goods in ways that initially suited encomenderos, but over long periods of time also spurred economic and human development. Our results highlight the benefits of disaggregating “institutions” to analytically discrete components, and of pushing analysis to the subnational level.

Suggested Citation

  • 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.
    • Handle: RePEc:col:000089:015668
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    References listed on IDEAS

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    Cited by:

    1. Sascha O. Becker, 2022. "Forced displacement in history: Some recent research," Australian Economic History Review, Economic History Society of Australia and New Zealand, vol. 62(1), pages 2-25, March.
    2. Diana Ricciulli-Marín, 2020. "The Fiscal Cost of Conflict: Evidence from La Violencia in Colombia," Cuadernos de Historia Económica 53, Banco de la Republica de Colombia.
    3. Faguet, Jean-Paul & Sánchez, Fabio & Villaveces, Marta-Juanita, 2020. "The perversion of public land distribution by landed elites: Power, inequality and development in Colombia," World Development, Elsevier, vol. 136(C).
    4. Diana Ricciulli, 2020. "The Fiscal Cost of Conflict: Evidence from La Violencia in Colombia," Documentos CEDE 18537, Universidad de los Andes, Facultad de Economía, CEDE.

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    More about this item

    Keywords

    Encomienda; forced labor; state capacity; extraction; colonialism; development; Colombia;
    All these keywords.

    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

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