Representation without taxation, taxation without consent; the legacy of Spanish colonialism in America

Irigoin, Alejandra (2015): Representation without taxation, taxation without consent; the legacy of Spanish colonialism in America. Published in: LSE Economic History Dept Working Papers series No. 227 (15 December 2015): pp. 1-40.

Abstract

The article examines Spain’s colonial legacy in the long run development of Spanish America. It surveys the fiscal and constitutional outcomes of independence and assesses the relative fiscal and trade burden imposed by colonialism. Constitutional asymmetries between revenue collecting and spending agents constrained de facto governments’ power to tax. Inherent disparities embedded in colonial fiscal system worsened with vaguely defined representation for subjects and territories and troubled their aggregation into a modern representative polity. Governments with limited fiscal capacity failed to deliver public goods and to equitably distribute costs and benefits of independence. Growing indirect taxes, debt and money creation allowed them to transfer the fiscal burden to other constituents or future generations. Taxpayers realised the asymmetry between private contributions and public goods and hence favoured a low but regressive taxation. Comparisons with trajectories in the metropolis and the US are offered to qualify the legacy.

Forthcoming in: Revista de Historia Económica - Journal of Iberian and Latin American Economic History

• Item Type: MPRA Paper
• Language: English
• Keywords: colonial legacies; taxation and representation; debt and monetary policy; institutions and long run development; Spain, Spanish America, USA
• Subjects: E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook > E63 - Comparative or Joint Analysis of Fiscal and Monetary Policy ; Stabilization ; Treasury Policy; N - Economic History > N1 - Macroeconomics and Monetary Economics ; Industrial Structure ; Growth ; Fluctuations > N10 - General, International, or Comparative; N - Economic History > N2 - Financial Markets and Institutions > N20 - General, International, or Comparative; N - Economic History > N4 - Government, War, Law, International Relations, and Regulation > N40 - General, International, or Comparative

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