Peru's Fix for Bossism: New Local Offices Broke Elite Monopolies

Why Local Bosses Matter

Anna F. Callis and Christopher L. Carter investigate how central governments can expand authority into peripheral areas when entrenched local elites (monopolist capture) block implementation of state policies. Monopolist capture occurs when a single local actor or faction dominates appointments and local politics, allowing them to resist or veto initiatives from the center. Understanding how states push back matters for debates about state capacity, administrative design, and the limits of decentralization.

A Historical Case With Novel Data

The authors study turn-of-the-twentieth-century Peru using new data on roughly 12,000 sub-municipal units. In this period the justice of the peace served as the primary local institution through which elite monopolies were entrenched. Callis and Carter exploit as-if random variation in population-based appointment rules that governed selection of the justice of the peace to identify where monopolist capture emerged.

Natural Experiment and Research Design

Callis and Carter treat the variation in appointment rules as a natural experiment that creates plausibly exogenous differences in the likelihood of monopolist capture across localities. They trace government responses to these local monopolies and evaluate downstream administrative outcomes, focusing on the Peruvian state's decision to create a new subnational executive post—lieutenant governors—with appointment rules that differed from existing offices.

What They Find

• The Peruvian government systematically created lieutenant governor positions in places where population-based appointment rules made monopolist capture likely, consistent with a deliberate balancing strategy.
• Where lieutenant governors were installed, central authorities were better able to carry out contested administrative tasks: notably, the state succeeded in implementing a 1902 education census that was otherwise opposed or blocked by entrenched local elites.
• The evidence links institutional design (creating offices with distinct appointment rules) to improved state reach and reduced elite obstruction at the local level.

Why This Matters for State-Building and Institutional Design

The study shows that weak central states can expand effective authority not only by co-opting local bosses, but by introducing alternative local offices whose appointment rules undercut monopolies. This “balancing” strategy offers a measurable mechanism for increasing state capacity and offers a concrete historical example informing contemporary debates about decentralization, local governance, and administrative reform.