Abstract: While existing evidence shows that nation-building policies unify societies, little is known about how and what makes some societal groups to resist them. We examine this in the context of the post-Mexican Revolution (1920s–1950s), when the new state implemented a nation-building policy to eliminate Indigenous cultures and identities by increasing connectivity via transport infrastructure. In a difference-in-differences design, we leverage heterogeneity in the exposure to pre-colonial political centralisation as a proxy for the ability of Indigenous populations in mobilising to resist national integration. We find that the expansion of transport infrastructure was lower in municipalities with a stronger efficacy of Indigenous mobilisation. We demonstrate that this underprovision of public goods can be partly explained by Indigenous identity preservation and high abilities for collective actions.
Keywords: Indigenous institutions; Indigenous mobilisation; nation-building; collective action; identity preservation
JEL Classification: H41, N7, O18
Cite as: Aldo Elizalde, Eduardo Hidalgo, Nayeli Salgado, Sotiris Kampanelis, Public good or public bad? Nation-building and Indigenous institutions, Journal of Development Economics, Volume 179, 2026, 103652, ISSN 0304-3878, https://doi.org/10.1016/j.jdeveco.2025.103652
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