- Economic and Political Inequality in Development: The Case of Cundinamarca, Colombia
- Download: PDF 721.27 KB
- by Robinson, James A.; Acemoglu, Daron; Bautista, María Angélica; Querubín, Pablo
- Is inequality harmful for economic growth? Is the underdevelopment of Latin America related to its
unequal distribution of wealth? A recently emerging consensus claims not only that economic inequality
has detrimental effects on economic growth in general, but also that differences in economic inequality
across the American continent during the 19th century are responsible for the radically different economic
performances of the north and south of the continent. In this paper we investigate this hypothesis using
unique 19th century micro data on land ownership and political office holding in the state of Cundinamarca,
Colombia. Our results shed considerable doubt on this consensus. Even though Cundinamarca is indeed
more unequal than the Northern United States at the time, within Cundinamarca municipalities that
were more unequal in the 19th century (as measured by the land gini) are more developed today. Instead,
we argue that political rather than economic inequality might be more important in understanding
long-run development paths and document that municipalities with greater political inequality, as measured
by political concentration, are less developed today. We also show that during this critical period
the politically powerful were able to amass greater wealth, which is consistent with one of the channels
through which political inequality might affect economic allocations. Overall our findings shed doubt
on the conventional wisdom and suggest that research on long-run comparative development should
investigate the implications of political inequality as well as those of economic inequality.
- Publication Type: WCFIA Working Paper
- Published Date: June 2007
- Field of Interest: International Economics
- Robison, James A., Daron Acemoglu, María Angélica Bautista, and Pablo Querubín. "Economic and Political Inequality in Development: The Case of Cundinamarca, Colombia." Working Paper 2008-0102, Weatherhead Center for International Affairs, Harvard University, June 2007.
- Also NBER Working Paper No. 13208.