Luz Marina Arias

Working Papers

“Indigenous Origins of Colonial Institutions,” joint with Desha Girod. 2010.   pdf

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. We test the
hypotheses using an original dataset of natural resources and labor and tribute institutions
from the pre-colonial and colonial periods for 455 sub-national territories in
the Americas. The data are consistent with the hypotheses. Existing arguments about
the national origin of colonists receive mixed support from the data. The article suggests
that political and economic development today is a consequence of both natural
resources and indigenous institutions, and therefore predates European colonialism. 

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“A theory of the origins of coercive enforcement: The provision of public goods in Colonial Mexico," 2008   pdf

Abstract: A state with a coercive administration to enforce revenue collection underlies most economic analysis of the provision of public goods. Historically, however, rulers have obtained revenues without centralized fiscal administrations. I study the mechanisms used by the Spanish Crown to enforce revenue collection in Colonial Mexico and find that rulers face a trade-off between administrative cost-efficiency and the provision of public goods. Instead of investing in a coercive administration, rulers can target public goods and obtain revenue in exchange from the benefited groups. I also provide a game-theoretic framework to analyze the institutional change in Colonial Mexico to a coercive fiscal administration and the formation of a standing army. The results show that a transition can ensue when the cost due to free-riding of not providing a non-targetable public good---a standing army---becomes sufficiently large for both the ruler and the powerful groups. The powerful groups consent to an increase in the ``grabbing" hand of the state as a commitment device to overcome free riding and ensure survival.

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“Can legitimacy lead to the concentration of coercive power?”  Working paper, 2007.    pdf 

Abstract: Few have analyzed the strategic forces behind the process of concentration and dispersion of coercive power. This paper undertakes this endeavor by studying the conditions under which a legitimate ruler will concentrate coercive power. I propose an operational definition of legitimacy --the ability to coordinate other social actors non-coercively-- and show that so defined legitimacy can serve as a mechanism for rulers to concentrate coercive power. In a dynamic common agency model with rational agents and perfect information, where nobody can sign binding contracts, I find that players voluntarily give up their coercive power under some circumstances. This is surprising given that in the model the ruler cannot commit to not appropriating future income, and there are no intrinsic social gains from concentrating power in a single actor. In traditional explanations, most state structures develop bases for legitimacy after having emerged from relations of coercion. The strategic model presented provides a complementary and perhaps alternative channel for the emergence of an authority that monopolizes coercion.