This chapter elaborates the argument developed inby empirically evaluating existing theories of the tax burden and using that analysis to construct an explanation of variance among the case study countries. While most theories are unconvincing, three variables from the literature do resonate with the cases: non-tax natural resource revenues, certain distinctive features of the Brazilian and Chilean constitutions and, most crucially, an expanded version of the power resource perspective, which suggests that the tax burden reflects the balance of power been statist and anti-statist forces. The shortcoming of this argument is that it does not explain cross-national differences in this power balance. Hence, the chapter develops an account, drawing on path dependence theory, tracing these differences to the occurrence or not of reform waves that threatened private property. Where such waves occurred, in Chile and Mexico, they impeded future taxation by prompting the formation of enduring anti-statist blocs anchored by peak business associations and rightist parties. In Argentina and Brazil, in contrast, such waves did not occur and anti-statism remained a less powerful force.

Considering that Chile is among the wealthiest countries in Latin America, its tax revenues are low. Its tax burden in recent years has been far below those of Argentina and Brazil and is even surpassed by those of some much poorer countries, like Bolivia, Ecuador and Honduras. A law passed in 2014 promised to boost revenues significantly, but as of 2017 it had not done so. This chapter seeks to explain Chile’s light tax burden. Resource extraction plays an important role in Chile’s economy, but it cannot explain the country’s light tax burden since fiscal revenues from this source are modest. The central argument is that light taxation reflects the indirect impact of a major redistributive reform wave during the early 1970s that unwittingly tilted the balance of power in Chilean society in favor of anti-statist forces in an enduring manner. It did so in the short term by providing the impetus for a radical state retrenchment program under military auspices, and in the longer term by fomenting the rise of actors and institutions capable of sustaining anti-statism as an influential force under more democratic conditions.

This chapter conceptualizes, codes, and provides a visualization of property rights gaps. Land can be held by individuals, groups, and governments; ownership can be formalized or informal in various ways; and property rights can face a diverse array of restrictions. I home in on several critical components of property rights in constructing my property rights gap measures: land formalization, defensibility, and alienability. I use these aspects of property rights to construct measures of complete, partial, and absent property rights. Based on these definitions, this chapter outlines the original data, I collected on land reform and property rights through land titling in Latin America, and then visualizes the data used to construct measures of the property rights gap. The chapter situates the data and patterns relative to important forms of landholding such as collective and communal land rights, cooperatives, land that is nationalized, and individually held land. This chapter also discusses the evolution of land rights in Latin America from the colonial period to the early 1900s.

This chapter uses original subnational data on land reform in Peru as well as data on property rights and metrics of development to investigate how the creation of local-level property rights gaps shaped subsequent economic and social outcomes linked to development. The analyses utilize a geographic regression discontinuity design that takes advantage of Peru’s regional approach to land reform through zones that did not entirely map onto major pre-existing administrative boundaries. These zones were created with aid from the United States in the aftermath of World War II. This chapter finds that local property rights gaps in Peru drove a slower shift away from agricultural labor, lower agricultural productivity and educational attainment, and higher rates of inequality and poverty. Land titling that began under President Fujimori's neoliberal reforms helped to close the property rights gap. But some of its negative development consequences persisted, in part due to a return to land inequality. The findings are not driven by Peru's civil war, pre-reform hacienda presence, or public goods provision.

This chapter employs original data on land reform and property rights to empirically test the theory. Using data from Latin America from 1920–2010 and cross-tabulation, regression, and instrumental variables analysis, the chapter find strong evidence in support of the theory that property rights gaps are generated by authoritarian regimes where the ruling coalition of political elites does not overlap with landed elites. In contrast, property rights gaps are typically closed by democracies, especially when peasants are in the ruling coalition and legislative fractionalization does not give opposition lawmakers a chance to block reform. Property rights gaps are also closed by both authoritarian regimes and democracies when countries are forced into structural adjustment programs. And left-wing ideology and state capacity play a role well in property rights gaps. This chapter also finds that the governments that redistribute property without rights also distort crop prices to render beneficiaries dependent on the government, and through a comparative analysis of nationalizations of banks and natural resources shows that the withholding of property rights over land is strategic.

This chapter examines land reform and property rights globally. First, it generates an original account of the principal features of property rights over land that governments have granted to beneficiaries in the course of all major redistributive land reform programs from 1900 to 2010, including land titling, nationalization, collectivization, and the formation of cooperatives. Second, it shows that democracy, dictatorship, foreign pressure, coalitions among landed elites, political elites, and peasants, and legislatures under democracy impact the opening and closing of property rights gaps around the globe as in Latin America. Finally, it conducts process-tracing exercises in Portugal and China to demonstrate further support for the theory's causal mechanisms and weigh that support against alternative explanations tied to ideology and limited state capacity. The discussion of China illuminates the enormous economic, social, and human costs – and political benefits – of retaining a large property rights gap for decades on end. Weak property rights contributed to the Great Famine, and then partial property rights reforms ignited national development in the countryside and in cities.

The concluding chapter discusses limitations to the property rights paradigm. Neoliberal property rights are not a cure-all for rural development. There is an emerging consensus from the United Nations, World Bank, and FAO on the need for more context-specific property rights and international guidelines on how to respect, record, and strengthen such rights, especially customary rights. The conclusion then shows how the book’s theory speaks to the broader relationship between politics and markets beyond land and redistribution. States can generate new markets or enable the rise of markets, or new markets can arise organically. A government can then choose whether, and how, to delineate and protect property rights in those markets. Like with property rights in land, a country’s political institutions (democracy vs. dictatorship) as well as government coalitional dynamics (between elite factions and citizens) and foreign pressure determine property rights regimes. The conclusion applies to the evolution of subsoil property rights over oil in Mexico, subsoil mining rights for mineral natural resources in the United States, and property rights in the banking sector in Venezuela.