The grievances of a failed reform: Chilean land reform and conflict with indigenous communities

This paper analyzes the effects of the Chilean land reform (1962-1973) on the intensity of the current indigenous self-determination conflict (1990-2016). The Mapuche were actively involved in the land reform process, and at least 150,000 hectares were expropriated in their favor. Nevertheless, the counter-reform process, after the 1973 military coup, almost fully reverted these expropriations. This failed land reform potentially created local grievances that may explain some aspects of the current social and political conflict in the region. To test this hypothesis, a unique geocoded plot-level database for the Araucania Region has been assembled. The results from OLS estimates suggest that plots involved in the land reform are more likely to be invaded and attacked. The effect is larger for plots located around indigenous reservations and those in which there was direct Mapuche participation during the land reform. To deal with potential endogeneity problems, we implement an instrumental variable identification strategy based on historical rainfall in the region. The IV estimates mostly confirm the main results. We show that the development of intensive forestry plantations after the land reform is a potential channel for explaining our results.