I recently watched an episode of Geekonomics, a channel focused on the macro-economics of different countries. The host is usually quite smart and thorough in his analysis, but this time his breakdown of Colombia's economy was particularly original.
His thesis didn't center on global events, recent political changes, or lack of infrastructure. Instead, he argued that geography is the fundamental driver. Specifically, geography across time—from the country's founding to the present day. Apparently, this geography has created a weak federation where regions function almost independently. He described Colombia as a "waterless archipelago": the mountain ranges create natural barriers that isolate regions from each other and weaken connections between major cities.
The lack of connectivity increase the difficulty to collect taxes, making the government economically weak and an elite safe from loosing their wealth. At the same time, a poor state make it inefficient on pushing services to isolated areas of the country and have that population stagnate and grow very slowly compared to other regions.
This raised a question for me: are Colombians themselves aware of this situation? And is it even fixable?
The geographic split is straightforward in its effects. It created a weak federation, which in turn created weaker wealth distribution and fewer opportunities across regions. My libertarian instincts naturally bristled at the mention of government distribution—especially since most economists seem married to the Keynesian narrative that the state is the ultimate economic planner and benefactor. But I think this case warrants an exception. Throughout history, governments have distributed land, and for centuries, land was the universal source of wealth.
The host compared this to large landowners forming an elite that behaves like royal families—with generational wealth insulated from redistribution and little incentive to share prosperity.
For many countries in the world, wealth has taken different shapes. From the original land = wealth, we went to factories and production of products and machines build wealth, to the digital economy, where land is sometimes seemed more as a disadvantage than advantage. Countries with limited wealth get richer quicker than big countries with lot of natural resources. But in Colombia, the economy seems to be still operating as 500 years ago, and even thought the wealth has change, the isolation still has built a culture of war-like syndrome.
In conclusion, I think the video open a whole new view on how countries grow and evolve, and how some of these walls might not matter anymore, but sometimes culture still believe in those limitations.
