Globalisation, Inequality and Institutions in West Sumatra and West Java, 1800–1940

How did globalisation affect living standards and inequality in colonies relying on exports? This question is investigated through a comparison of social and economic developments in two regions of the Dutch East Indies (colonial Indonesia): Minangkabau in West Sumatra and Priangan in West Java, looking at the period between 1800 and 1940. These two regions were remarkably similar in terms of export crops grown and factor endowments and the Dutch colonial government implemented a comparable system of forced coffee cultivation in both these areas in the nineteenth century. Outcomes in terms of levels of income and economic inequality in these areas differed markedly, mainly as a result of different indigenous property rights regarding land and the power of local elites. This article highlights the interaction between indigenous and colonial institutions and the importance of this interaction for social and economic development in an age of rising global trade.