Insurgency and Long-Run Development: Lessons from the Mexican Revolution

. . . [M]unicipalities experiencing severe drought just prior to the Revolution were substantially more likely to have insurgent activity than municipalities where drought was less severe . . . 

. . . Many insurgents demanded land reform, and following the Revolution, Mexico redistributed over half of its surface area in the form of ejidos: farms comprised of individual and communal plots that were granted to a group of petitioners . . . 

. . . Today, insurgent municipalities are 20 percentage points more agricultural and 6 percentage points less industrial . . . 

That is from a new working paper by Melissa Dell. 

From the conclusions:

Based on the quantitative and historical evidence, I hypothesize that the Mexican state gained a monopoly on violence in rebellious regions through implementing large-scale agrar- ian reform in the years following the Revolution. Agrarian reform imposed considerable restrictions on redistributed lands and fostered a clientalistic political system dominated by a single party bureaucracy. This paper provides detailed evidence that the restrictions on land and labor market transactions and the politicization of agriculture that accompanied agrarian reform stifled industrialization and lowered incomes in places that received more land reform relative to places that received less.

Agrarian reform may be important for promoting stability and reducing inequality in tra- ditionally conflicted regions. This study highlights that when agrarian reform is accompanied by extensive restrictions on land markets and fosters clientalistic political arrangements, this can have large, negative long-run consequences for economic prosperity. How agrarian dis- putes can be most effectively resolved and agrarian reform most effectively implemented remains an important question for future research.