The Rent-Seeking Legacy of the Plantation Economy in Trinidad and Tobago

Abstract

The sugar plantation established rent-seeking in Trinidad and Tobago, drawing geopolitical rent from trade preferences, along with an ethnically diverse population living at a basic level of welfare. Colonial efforts to encourage investment to boost productivity and raise the income of a more compact workforce to UK levels coincided with democratization. This had the unintended consequence in Trinidad and Tobago of stimulating excessive rent-seeking, which eliminated plantation profitability in the 1960s. However, this chapter argues that the plantation is a more flexible development institution than both dependency theorists like Best and mainstream economists like Baldwin assume. In contrast to Trinidad and Tobago, Mauritius’s sugar plantations successfully reformed and prospered under developmental government policies running hard budget constraints.