Bolivia is central to the book’s account of how colonial institutions turned the wealth of the Andes into a system of coerced labor and lasting inequality. The silver mountain of Potosí drew people and resources into a Spanish imperial economy, while the labor regime built to exploit it left a durable imprint on the region’s institutions and prosperity. The book traces that imprint from the colonial mining system to contrasts between neighboring Peruvian communities, and places Bolivia within a wider pattern of persistent poverty in the Americas.

Silver and the making of Potosí

In 1545, a local man named Diego Gualpa was searching for an Indigenous shrine high in the Andes when a gust of wind knocked him to the ground and exposed silver ore. The Spanish named the immense mountain containing it El Cerro Rico, or “The Rich Hill.” A city grew around the deposit. By 1650, Potosí had an estimated population of 160,000, making it larger than Lisbon or Venice at the time. Its scale reflected the pull of a rich mineral source, but also the immense labor needed to extract its silver.

The Spanish first organized Indigenous people through the encomienda, assigning communities to conquistadors who had accompanied Francisco Pizarro. As the mining economy expanded, however, this arrangement faced a more systematic labor program. The vice-regent Francisco de Toledo arrived in Peru in 1569 with a central task: finding workers for the mines. He spent five years traveling and investigating the territory, and commissioned a large survey of the adult population. The resulting interventions reshaped where Indigenous people lived and how their labor was claimed.

The Potosí mita

De Toledo moved almost the entire Indigenous population into newly established towns called reducciones, or “reductions,” making communities easier for the Spanish Crown to administer and exploit. He then revived and adapted the Inca mita, a system of labor turns. Under Inca rule, forced work on plantations supplied food for temples, the aristocracy, and the army; the Inca elite, in turn, provided famine relief and security. Under Spanish rule, especially in the Potosí mita, the institution became what the book describes as the colonial period’s largest and most onerous labor-exploitation scheme.

The mita’s reach was enormous. De Toledo designated a catchment area of about 200,000 square miles, extending from central Peru across most of what is now Bolivia. One-seventh of the male inhabitants in this area, newly concentrated in reducciones, were required to work in Potosí’s mines. The designated territory overlapped the heartland of the Inca Empire and included Cusco, its capital. The mita endured throughout the colonial period and was abolished only in 1825. Its long duration and broad geographic scope made the labor demands of the mines more than a local imposition: they were built into the organization of an extensive Andean region.

The mita operated alongside other arrangements designed to press people into the colonial economy on terms favorable to Spanish landowners and merchants. De Toledo converted the encomienda into an annual head tax, a fixed payment in silver owed by each adult male. The tax was intended to push people into the labor market and reduce wages for Spanish landowners. The repartimiento de mercancias compelled Indigenous people to buy goods at prices set by Spaniards, while the trajin required them to carry heavy loads—including wine, coca leaves, and textiles—for Spanish commercial ventures. Together, these institutions extracted labor, money, and transport from Indigenous communities through separate but reinforcing channels.

A colonial legacy in regional differences

The book connects the colonial labor regime to inequalities that remained visible long after the mita ended. It compares Calca and Acomayo, two highland provinces in Peru inhabited by Quechua-speaking descendants of the Incas and growing the same crops. Yet Acomayo is much poorer: its inhabitants consume about one-third less than people in Calca. In Calca, crops are sold in markets for money; in Acomayo, they are grown for subsistence. The difference is reflected in access as well as income: the road to Calca is surfaced, while the road to Acomayo is in severe disrepair, and travel beyond Acomayo requires a horse or mule.

The book identifies the historical distinction between these neighboring communities as institutional: Acomayo lay within the Potosí mita’s catchment area; Calca did not. It treats their divergent circumstances as evidence that the consequences of colonial labor institutions could persist in places whose inhabitants otherwise shared language, geography, and crops. The contrast makes the mita’s legacy concrete—not only a history of silver production, but a historical division associated with different economic conditions.

The same argument places Bolivia’s persistent poverty within a broader continental pattern. In the book’s comparison of American countries, Bolivia belongs to a distinctly poorer group with Guatemala and Paraguay, below countries such as Brazil, Mexico, and Peru. That ranking, it notes, is strikingly stable across comparisons reaching back fifty, one hundred, and one hundred and fifty years. The pattern is not presented as an unchanging fact of geography; rather, the book links the region’s persistent disadvantage to the colonial institutions that shaped its economic and political development.

Bolivia in the argument about institutional persistence

The book’s broader account contrasts the extractive institutions established in Spanish America with the more inclusive arrangements that developed in the United States and Canada. In the densely settled regions of earlier American civilizations, European conquest interacted with existing institutions to produce a reversal of fortune: areas that had once been relatively wealthy became relatively poor, while the United States and Canada, then less developed than the civilizations of Mexico, Peru, and Bolivia, became much richer. Bolivia thus belongs not simply to a list of poorer countries, but to a historical explanation of how colonial rule and institutional divergence shaped the distribution of prosperity across the Americas.

Potosí provides the sharpest local illustration of that argument. Silver made the region extraordinarily valuable to the Spanish Crown, and the institutions surrounding it extracted wealth through labor demands, taxes, compulsory purchases, and transport obligations. The resulting wealth accrued to the Crown and to conquistadors and their descendants, while Indigenous living standards were driven toward subsistence. The book associates this extractive colonial structure with Latin America’s extreme inequality and with persistent poverty in Bolivia and Peru. It also cites research on the Bolivian Revolution of 1952 as part of scholarship on the persistence of inequality and inherited privilege, extending the question of institutional legacies into the modern political era without treating colonial arrangements as the only factor in subsequent history.