Justice as Checks and Balances

ABSTRACT The centralization of conflict resolution and the administration of justice, two crucial elements of state formation, are often ignored by the state-building literature. This article studies the monopolization of justice administration, using the historical example of the General Indian Court (gic) of colonial Mexico. The author argues that this court’s development and decision-making process can show us how the rule of law develops in highly authoritarian contexts. Centralized courts could be used strategically to solve an agency problem, limiting local elites’ power and monitoring state agents. To curb these actors’ power, the Spanish Crown allowed the indigenous population to raise claims and access property rights. But this access remained limited and subject to the Crown’s strategic considerations. The author’s theory predicts that a favorable ruling for the indigenous population was more likely in cases that threatened to increase local elites’ power. This article shows the conditions under which the rule of law can emerge in a context where a powerful ruler is interested in imposing limits on local powers—and on their potential predation of the general population. It also highlights the endogenous factors behind the creation of colonial institutions and the importance of judicial systems in colonial governance.