Bourbon Reforms and State Capacity in the Spanish Empire

Abstract

We study the fiscal and political consequences of state modernization in the Spanish colonial empire in Latin America. We focus on the introduction of a new corps of provincial governors called intendants in the late 18th century. Leveraging the staggered adoption of the reform and administrative fiscal microdata, we show that the intendancy system sizably increased Crown revenue by strengthening state presence in the periphery and disrupting local elite capture. Politically, the reform reduced rebellions by previously exploited indigenous peoples. However, naming patterns reveal that the intendants heightened anti-Spanish sentiment among Creole elites, plausibly contributing to the nascent independence movement.

Keywords: State Capacity, Taxation, Bureaucracy, Conflict, Elites, Colonialism, Independence, Latin America

JEL Classification: D73, D74, H71, N46, P48