ECO 500 Project 1- Melissa Dell, Peru Mining

 The Persistent Effect of Peru's Mining Mita by Melissa Dell

    Melissa Dell wrote a paper of the effects of Peru's Mining Mita. Let's begin with what is a mita? The mita was a forced mining labor system, essentially slavery, in effect in Peru during the rule of the Spanish Empire.The image above outlines the zone of Peru that was affected by the mita. The people within this region were subjected to slavery by the Spanish Empire and forced to work in the mining business for the profitability of the Spanish Empire. This mita began in the year 1573 when the Inca Empire was overthrown and the Council of the Indies was put in place by the Spanish Empire. The Spaniards essentially thought they were entitled to free labor and resources, or rather the right to enslave the native people, and issued an order for one seventh of the adult male population to rotate working in the mines for the Crown. They were not paid for this labor and this lasted for nearly 240 years until it was finally abolished in 1812 when the silver deposits were mined dry. Per Melissa Dell's estimates, approximately 3% of the population living within the current boundaries of Peru were forced to mine in the mita at some point in time. The question Dell poses for research is: what are the long run impacts of the mita system and does it affect living conditions in certain areas today? To answer this question, Dell analyzed geography, consumption, elevation, education, income, and more factors that may have impacted the study. She used equations known as "Regression" that is effectively used to identify how much one thing impacted another, or correlation. She used a variable as what she was looking to find, in the particular zone in question and set it equal to control variables for the specific geographic region she was attempting to measure. The equation she used was as follows:

cidb = α + γmitad + X idβ + f(geographic locationd ) + φb + εidb

 She used an equation with something known as a dummy variable, which is essentially a  variable that either equals 1 or 0 and is used to analyze if the varibale is significant and affects the final outcome, to compare the zone inside the region against the area surrounding it. This was also used to analyze consumption in comparison to the region inside the mita zone against the area outside the zone. Through her control for other outside factors that may impact the study, Dell realized areas within the boundaries of the zone affected by the mita had fewer public services such as roads, less income, less education, and generally consumption was much lower in comparison to nearby areas that were outside of the mita zone. Historically, the study suggest that areas within the mita generally had less access to important resources for development, education in particular. Resources for public goods such as roads was inconclusive, but it did seem that population was less dense in this region, which could be attributed to the large amount of farmers within the mita zone. Dell also thought it was possible that because there were many large land owners near in zones near the mita they were set up to be more successful due to higher stability within their economy. This brings us back to Dell's research question in analyzing the impacts of the mita system. The conclusion is that it is possible that this system has impacted the general standard of living within the area today, since income is generally lower and there is clearly less education in the zone, but there are other factors that could cause this. While there is no definitive answer, as this happened so long ago and we cannot observe what is known as the "counterfactual", or what would have happened if the mita never came into place, there is not enough definitive results to assert the fact that the mita has caused poverty and slowed development to this day.