How do legacies of resettlement strategies for contested frontiers by past regimes affect the strategic choices of subsequent regimes, and what long-term economic consequences follow? The authors develop a cost-centric theory: states with underpopulated frontiers near rivals face subversion and conflict risks. Given high defense costs, they use agro-military settlements, offering moderate security at moderate setup and maintenance cost. If past regimes used such strategies, the infrastructure they left behind shapes settlement locations for subsequent regimes. Once established, these policies become self-perpetuating, fostering inefficient institutions and underdevelopment. Using data from Heilongjiang, the authors show that Japanese-era frontier defense settlements (1931–1945) led to continued Chinese state farms post-1945. The state maintains inefficient institutions that hinder long-term growth for security, revealing an alternative link between settlement and development.
Xu et al. (Tue,) studied this question.