Giuliana Pardelli

We explain and document state-level fiscal developments in American Southern states from 1820 to 1910, focusing on their main source of revenue, progressive property taxes borne primarily by economic elites. The fourteen states in our analysis were characterized by severe economic exploitation of the enslaved and later politically repressed African-descended population by a small rural elite, who dominated the region both politically and economically. While rural elites are thought to be especially resistant to taxation, we offer a set of conditions that explains the emergence of progressive taxation and provides a coherent account of the fiscal development of these states over this period. Using an original, archival data set of annual tax revenues and select expenditure items, we show that the economic interests of these rural elites and the extent of their formal (over)representation played a critical role in shaping the observed fiscal patterns within and across Southern states over this period.

This book extends our research on the fiscal development of the American South to the U.S. North. Using newly digitized archival data at the state and county levels, we examine how Northern elites responded to industrial growth and changing patterns of political representation, asking whether they invested in state-building, pursued tax avoidance, or shifted authority downward through decentralization. In doing so, the project tests competing claims in comparative political economy and offers new insight into the development of American “stateness” during a period of rapid transformation. Read alongside our volume on the South, it will let us compare how divergent trajectories of political representation shaped fiscal development across American states over the long nineteenth century.

This book explores how the power and interests of local agrarian elites have historically shaped Brazil’s state capacity and the provision of public goods. It argues that the territorial reach of the state is not simply determined by geography or modernization, but by the strategic choices of rural elites at critical junctures in state formation. Where landholding was concentrated and political dominance uncontested, elites invested in fiscal capacity and administrative infrastructure, generating long-term gains in public goods and citizen trust. Where elites were fragmented or political competition was intense, robust fiscal institutions failed to develop, entrenching disadvantage for generations. Comparing state-level party systems, the book shows that distinct patterns of elite cohesion and conflict emerged in response to underlying economic structures and exogenous shocks. Drawing on mixed methods and rich historical and contemporary data, it then traces how initial investments in state capacity set in motion self-reinforcing dynamics that amplified advantages or disadvantages over time. While focused on Brazil, the book offers broader insights into the roots of spatial inequality, the role of elites in national development, and the enduring consequences of institutional divergence.

Why do some areas experience lower voter turnout even under compulsory voting systems? This paper examines the impact of migration turnover—encompassing both in- and out-migration—on voter turnout across communities. While past research has focused on migrant/non-migrant differences or in-/out-migration separately, we propose that both migratory movements tend to decrease political participation due to increased transaction and social costs. Using surveys and a new panel dataset combining census and voting records from over 5,000 Brazilian municipalities, we identify a robust negative association between local migratory turnover and voter turnout. This relationship holds across various time frames, levels of aggregation, analytical approaches, and definitions of variables. Analyses using individual-level data further corroborate these results. Additional tests suggest social costs constitute a key mechanism deterring turnout. These findings highlight the need to consider the broader consequences of population mobility for democratic processes and representation, particularly in areas experiencing higher levels of turnover.

Traditional agrarian elites have often been portrayed as obstacles to the expansion of the state. Because landed actors are particularly exposed to taxation, inequality is expected to exacerbate their resistance to the development of fiscal capacity. This article argues that when propertied actors are politically dominant and obtain benefits from public spending that are proportional to their capital endowments, wealth inequality is associated with greater elite support for capacity investments. Using early twentieth-century Brazilian data, the author shows that where landed elites faced fewer political threats, higher levels of landholding concentration were associated with increased fiscal and administrative capacity. Tests of mechanisms corroborate the idea that this relationship results from elite demands for specific types of public spending. These findings contribute to the broader literature on state-building by providing new insights into the interaction between economic interests and political dominance in shaping subnational variation in the reach of the state.

A long-standing scholarship argues that greater ethnic diversity harms social cohesion. However, recent research also suggests that these outcomes are primarily influenced by the strength of state institutions. We evaluate these arguments using new geocoded historical data from Brazilian municipalities. Our initial analysis confirms that local racial diversity is negatively associated with social cohesion indicators such as trust, civic participation, belonging, turnout, and crime. Nonetheless, further analysis indicates that this relationship cannot be directly attributed to the effects of diversity, but rather hinges on the concentration of historically (dis)advantaged racial groups within particular areas. Finally, we demonstrate that both the spatial distribution of these groups and current levels of social cohesion are linked to past state capacity across municipalities. These results suggest that local social cohesion is more strongly associated with the historical development of state institutions across the national territory than with their contemporary levels of racial diversity.

Replication data

When do elites support the expansion of the state’s ability to tax? Despite the disproportionate influence that elites are theorized to exert on politics, answers to this question remain elusive. We argue that elites will support increased taxation, including on themselves, when they believe greater fiscal capacity will yield collective goods that further their interests, they have political control, and they expect this control to persist into the future. We test our argument by measuring changes in state taxation using an annual panel of Southern slaveholding states between 1840 and 1860. Our strategy exploits both institutional differences across these states in the de jure political control of enslavers and rising international demand for Southern cash crops. We find that states with greater enslaver control responded to increased demand for their crops by raising taxes on enslaved people and land, their primary assets, to fund railroad construction.

Why do communities with larger shares of ethnic and racial minorities have worse public goods provision? Many studies have emphasized the role of diversity in hindering public outcomes, but the question of causality remains elusive. The authors contribute to this debate by tracing the roots of both contemporary racial demography and public goods provision to the uneven historical expansion of the state. Focusing on new historical data from Brazil, the authors show that more remote municipalities with lower levels of state capacity in the past were more frequently selected by people who escaped enslavement to serve as permanent settlements. Consequently, such municipalities have worse public services and larger shares of Afro-descendants today. These results highlight the pervasive endogeneity of the relationship between ethnic demography and public outcomes. The failure to account for context-dependent historical confounders raises concerns about the validity of previous findings regarding the social costs and benefits of any particular demographic composition.

How does ethnoracial demography relate to public goods provision? Many studies find support for the hypothesis that diversity is related to inefficient outcomes by comparing diverse and homogeneous communities. We distinguish between homogeneity of dominant and disadvantaged groups and argue that it is often impossible to identify the effects of diversity due to its collinearity with the share of disadvantaged groups. To disentangle the effects of these variables, we study new data from Brazilian municipalities. While it is possible to interpret the prima facie negative correlation between diversity and public goods as supportive of the prominent “deficit” hypothesis, a closer analysis reveals that, in fact, more homogeneous Afro-descendant communities have lower provision. While we cannot rule out that diversity is consequential in other contexts, our results cast doubt on the reliability of previous findings related to the benefits of local ethnoracial homogeneity for public outcomes.

Replication data

How did the onset of Jim Crow reshape Southern fiscal priorities? Using a new dataset of annual state spending in fourteen Southern states (1880–1910), we find that although the level of total spending remains unchanged, the composition shifted: redistributive spending on common schools and pensions contracted, while expenditures on higher education, prisons, and debt expanded. Within states, however, state government spending paradoxically increased in counties with larger Black populations, despite the documented collapse in state resources going to Blacks. We trace this shift in spending away from Whites statewide towards Whites in high Black-share counties to skews in representation: population-based apportionment that continued to count disenfranchised Blacks meant that legislative majorities could be secured by winning counties with only 27–40% of each state’s White population. Our findings suggest that, beyond malapportionment, targeted redistribution to specific low-income Whites was a previously unrecognized contributor to the rise of the Solid South.

Do economic booms stabilize or fracture party systems? Resource-windfall research expects rising revenues to strengthen incumbent parties and reduce fragmentation. I contend that where windfalls accrue to private elites, mobilization is broker-mediated and portable, and party labels are weak, booms can instead destabilize ruling coalitions by relaxing the financing constraint on elite exit. I evaluate this claim in Brazil’s First Republic using eleven congressional elections across eighteen autonomous state party systems. Difference-in-differences estimates show that rising commodity prices erode the largest party’s seat share, raise the effective number of parties, and benefit new parties in export-homogeneous states, with no fragmenting response observed in diversified states, where policy stakes can deter splits. Deputy-level evidence shows that the price effect on successful party changes declines as export diversification rises. The findings qualify resource-curse and economic-voting accounts, identifying when prosperity weakens ruling coalitions and increases fragmentation.

Understanding how to tackle clientelism is crucial for enhancing political accountability. This paper examines whether stricter enforcement of labor regulations—a centrally-driven investment in state capacity—can weaken clientelism. Using an instrumental variable approach based on within-municipality changes in proximity to labor offices and state-level variation in labor inspectors in Brazil, we find that enhanced enforcement significantly reduces the electoral success of clientelistic parties and curtails patronage and vote-buying. These effects are consistent with enforcement-induced formalization and a contraction of the informal workforce, whose members are more likely to support clientelistic parties.

How do social norms and group identity shape tax attitudes? While citizens are often described as conditional cooperators, it remains unclear whether they respond similarly to in-group and out-group behavior. We develop an identity-conditioned account of peer effects in tax morale, distinguishing between two mechanisms: congruency, whereby individuals align with perceived in-group norms, and fairness reappraisal, whereby they revise their attitudes in response to unequal burden-sharing. We test our argument through a nationally representative survey experiment in Turkey that randomly varied the ethnicity and tax behavior of a business owner in a vignette. Observing tax evasion sharply reduced respondents’ tax morale, but only when the evader was a co-ethnic; identical out-group evasion had no effect. Mechanism tests show that this response was driven by shifts in congruency beliefs rather than fairness perceptions. In-group evasion also depressed support for redistribution, whereas information about access to public goods did not. These results show that social norms of compliance are group-bound, highlighting how identity shapes the microfoundations of cooperation and the design of effective fiscal communication.

Social trust is a core determinant of political behavior and outcomes. While often treated as stable, trust may respond to shocks such as natural disasters. Existing findings are limited by reliance on cross-national or coarse subnational data. We address this by linking municipal disaster records to geocoded survey data from Brazilian municipalities over two decades, capturing exposure to environmental shocks at fine spatial and temporal scales. We advance three findings. First, disaster severity, not occurrence, is positively associated with social trust. Second, the relationship is dynamic: emerging in the immediate aftermath, dissipating in the medium term, and re-emerging later, consistent with a shift from solidarity through contestation to reconstruction-phase consolidation. Third, the relationship is conditioned by local state capacity, with higher trust following severe disasters only where pre-disaster fiscal and administrative capacity is strong. These results reconcile conflicting findings and clarify when collective crises strengthen rather than erode social cohesion.

We estimate the causal effect of electing a clientelistic party on local governance in Brazilian municipalities over more than two decades. Using a regression-discontinuity design in close mixed-type mayoral races and ex-ante party classifications from three independent expert surveys, we find that clientelistic victories raise temporary public hiring by about 20 percent, increase audit irregularities by about 9 cases, and raise school dropout by 0.2 percentage points, while aggregate expenditure and revenue are unchanged. These results suggest that party organization shapes governance through the discretionary execution of a given budget, not through its size.