Long-Term Effects of a Commodity Boom: Rubber Slavery in the Amazon

This study examines the lasting impact of the Amazon Rubber Boom (1870-1914) on contemporary income, inequality, Indigenous presence, and forest conservation. Em pirically we combine variation in historical rubber distribution with an instrumental variable strategy using FAO-based rubber suitability and a Regression Discontinuity design around con cession boundaries. Municipalities with greater rubber presence experienced short-term gains in 1920 but long-run reversals by 2010, showing lower income, population density, and higher inequality and Indigenous extinction. Grid-level analyses across the Amazon further show that historical rubber suitability is associated with lower economic activity and sparser population today, alongside greater deforestation. The findings, consistent across Brazil, Colombia, Peru, and Bolivia, indicate that the rub ber boom’s short-lived wealth reinforced extractive institutions and violence against Indigenous peoples, leaving long-lasting economic, social, and environmental scars across the Amazon.

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