The economic legacy of early democracy

Abstract This article documents that a precolonial version of democracy was conducive to long-run development in the contemporary developing world. However, these early democratic institutions only promoted development where European colonizers lacked the power to destroy them. While most colonial power was centered around the capital, it diminished in concentric circles into the hinterlands. The limited colonial power outside the capital made it difficult for the Europeans to destroy early democracy, and therefore, it often persisted in the hinterlands. Over time, early democracy laid the foundation for long-run development because societal actors were able to sanction rulers who failed to deliver public goods. Combining ethnographic data on early democracy with fine-grained data on local development, I document an economic legacy of early democracy in the precolonial, colonial and contemporary eras.