The deep roots of inequality
To an economist, a map of southern Peru has a peculiar appearance. If you draw a line forming a kind of jagged oval, outlining a chunk of the Andes running from northwest to southeast, you have enclosed a region of relative poverty lying among areas of greater wealth. Yet there is no readily apparent explanation for this disparity; the well-off districts do not appear to have more natural resources than the poor ones, for instance.But Melissa Dell, a PhD student in MIT’s Department of Economics, thinks this economic riddle has an answer: the invisible hand of history. More specifically, Dell believes a system of labor conscription that the region’s Spanish colonial rulers used from 1573 to 1812 accounts for the pattern of economic development in the region today. The areas where the Spainish forced locals to leave the land and work in mines — a practice called the mita —...