The Vietnam Land Question - A Reversal of Fortune in Colonial Times?

The case of Vietnam, represented by the different development paths between Tonkin and Cochin-China, shows the complexity of analysis of the impact of colonialism. Population density was not the organizing principle behind the settlement of French colonialists. Nor did it significantly determine the level of extraction as expected by AJR’s theory. On the contrary, we show that the presence of several agents, local and foreign, with their own vested interests led to very different outcomes in the North than in the South. While the North, an extremely densely populated area prior to French colonization, remained at a high level equilibrium trap and sought tax evasion via population under-representation, the South through French investments, increased the land frontier and allowed for commercialization, which became the main revue of the French authorities. Large land concessions did increase inequalities in land distribution in the South, but a more favourable labour situation for the la bourer suggests some improvements for those previously less favoured. These results point at the need to reexamine what we mean by extractive and who the agent or agents are of that extraction. In sum, if we were to apply Acemoglu et al (2001) interpretation of the development of Vietnam, they would argue that the French did just perpetuate extractive institutions in Tonkin, while in the South the establish the “wrong type of capitalism”, but that is tautological. The real processes of change, which did occurred, are left unexplained but hint to the importance of factor endowments in the level of inclusiveness of the process.