Indigenous land and colonial institutions: how Aztec and Tupi landownership practices impacted the haciendas of New Spain and engenhos in Brazil

This paper adds to the literature on origins of institutions through a comparative study of landownership in colonial Mexico and Brazil and argues that pre-colonial indigenous land practices were key in shaping colonial outcomes. While both Portugal and Spain drew on their institutional traditions and historical experience with land grants to introduce the sesmarias and merced systems in the New World, different outcomes emerged. In New Spain, the haciendas produced cash crops and livestock using indigenous labour in large agricultural enterprises. In Brazil, the engenhos, similarly large private landholdings dedicated to sugar production for large-scale export, employed African slave labour almost exclusively. This variation can in part be traced back to the impact of land institutions – while the Aztecs in New Spain were familiar with private landholdings for nobility, the Tupi’s nomadic nature meant that private land was virtually inexistent before colonisation. Hence, the Spanish colonists were able to adapt and build on existing Aztec practices, such as granting land to nobility and using the encomienda labour draft to work these private lands. However, when the Portuguese introduced the sesmaria in coastal Brazil and attempted to get indigenous labour to work the fields, the Tupi rebelled, fought, and fled, and colonists turned to African slave labour instead.