Indigenous Origins of Colonial Institutions

Abstract

Differences in colonial institutions appear to explain divergent patterns of political and economic development across former colonies. However, the origins of colonial institutions are not well understood. This article hypothesizes that variation in colonial labor institutions can be explained by both pre-colonial indigenous governance and the resource promise of colonies. We derive the hypotheses using a game-theoretic framework that emphasizes constraints facing profit-maximizing colonists, indigenous leaders and workers. We test the hypotheses using an original dataset of natural resources and labor and tribute institutions from the pre-colonial and colonial periods for 454 sub-national territories in the Americas. The findings suggest that differences in political and economic development today may predate European colonialism.