Economic development in Puerto Rico after US annexation: Anthropometric evidence

Highlights

• Average male height in Puerto Rico increased by about 4.2 cm. from 1890 to 1940.

• Height increased at a rate more than twice the regional average from 1890 to 1940.

• Puerto Ricans at mid-century were among the tallest Latin Americans.

• The prevailing view that US annexation impoverished Puerto Rico is incorrect.

Abstract

This paper considers economic development in Puerto Rico following its annexation by the United States in 1898, a watershed moment in the history of the island and the pinnacle of American imperialism in Latin America. Drawing on data from three surveys, I show that male height in Puerto Rico increased at more than twice the average rate for Latin America and the Caribbean between 1890 and 1940. I also show that Puerto Ricans at mid-century were among the tallest Latin Americans outside of Argentina and Uruguay. The evidence supports the conclusion that conditions improved substantially after US annexation, in contrast to the prevailing view in the literature.

Introduction

Puerto Rico is the most populous unincorporated territory of the United States, and Puerto Ricans have been US citizens for more than a century. After World War II, Puerto Rico experienced one of the world's fastest growth rates for GDP per capita and labor productivity (Baumol and Wolff, 1996), became in 1967 the first country in Latin America to be classified as a “developed nation” by the World Bank (Duchesne, 2000), and remains one of the richest economies in Latin America. Nonetheless, the economic value of political association with the US has been historically, and is presently, a matter of considerable debate. US annexation in 1898, in particular, is perhaps the most controversial topic in Puerto Rican economic history. Scholars of early 20th century Puerto Rico have reached a broad range of conclusions about US annexation, from “extreme denunciations of US imperialism and its purported ruthless exploitation and impoverishment of the island...” to “unabashed praises of the US invasion for having saved Puerto Rico from the tyranny of Spanish colonialism, for building a modern economic infrastructure, and for eventually ushering in an era of democracy, relative prosperity, and social mobility...” (Ayala and Bergad, 2002, p. 65).

A key challenge to resolving the academic debate on conditions in early 20th century Puerto Rico has been a lack of quantitative evidence to measure living standards. In this paper, I draw on anthropometric evidence from three surveys of Puerto Rican men to comment on economic development. I exploit cross-sectional variation in birth year to identify differences in average height over time and compare age cohorts across surveys where possible. Increases in height have been found to be associated with rising living standards, and height data have been used in various other historical contexts to demonstrate the material benefits of colonialism (Brennan et al., 1997, Komlos, 2001, Moradi, 2009, Morgan and Liu, 2001, Olds, 2001). Likewise, I show that there was a significant rise in the height of Puerto Rican men following US annexation: adult men born in 1940 measure about 4.2 cm. taller than those born a decade prior to US annexation. Additionally, I show that Puerto Ricans at mid-century were among the tallest Latin Americans outside of Argentina and Uruguay.

Lacking an adequate control group and sufficient observations predating US rule, I do not argue that US annexation is responsible for changes across birth cohorts; after all, the 20th century witnessed improvements in living standards and stature across the West (Risk Factor Collaboration (NCD-RisC), 2016).¹ Rather, I more narrowly contend that widespread beliefs about impoverishment caused by US policy, or even stagnant economic conditions in the immediate aftermath of annexation, are incorrect. Such claims have been shaped in large part by failing to consider the realities of Spanish colonialism—and, therefore, blaming all problems on the US—and by observing that living standards in Puerto Rico were much lower than those of the US and Western Europe without properly comparing Puerto Rico's present conditions with the conditions that prevailed at the commencement of US rule (Ayala and Bergad, 2002, Chamber of Commerce of Puerto Rico, 1945). My findings are supportive of a marked improvement in the biological standard of living and are not attributable to selection into the sample or shrinking in old age.

Evidence of an improvement in the material well-being of Puerto Ricans stands in stark contrast to the prevailing view that US rule led to stagnant or even worsening conditions for most Puerto Ricans before World War II. For instance, D’Estefano (1968, p. 21) alleges that “Yankee colonialism” had produced “unemployment, exploitation, disease, hunger, and 400,000 illiterates.” Renowned historian Arturo Morales Carrión (1983, p. 153) describes Puerto Rico in this era as a “poorhouse... foundering in despair”, while political scientist Gordon Lewis (1963, pp. 89-90) insists that the revamped economy worked for the “interests of the colonial producer and not for those of the consumer”, most of whom were reduced to “a starvation diet of the very simplest of ground provisions.” Even the most widely cited economic history of Puerto Rico contends that there is “little evidence” of “improvements in the standard of living of the mass of working and nonworking people” (Dietz, 1986, p. 133).

My results also contradict the conclusions of Godoy et al. (2007), the only empirically grounded study with a somewhat negative appraisal of changes in living standards in the early 20th century. Despite using data from the same 1965 health survey analyzed in this paper, the authors find no statistically significant increase in height, which they ascribe to “the offsetting role of improved health and a stagnant rural economy during the first half of the 20th century” (p. 82). I argue that their result is the product of an overspecified regression model, which includes birth year fixed effects along with an age variable, generating severe collinearity and without adding meaningful information to the model. Furthermore, they include educational attainment and an urban/rural dummy as explanatory variables, diminishing the magnitude of the estimated effect of birth year. Including these variables purges the birth cohort fixed effects of variation attributable to rising levels of education and urbanization, which are correlated with time and are part of, not distinct from, the development process. A simple correction renders evidence of a clear rise in height and, therefore, the biological standard of living.

The results in this paper are, however, consistent with recent quantitative analyses that suggest that the early 20th century was a period of economic growth in Puerto Rico. Most importantly, Devereux (2019) and de Jesús Toro (1982) estimate that real income in 1940 was about two and a half times higher than in 1900. The results hold after adjusting GDP estimates for fluctuations in the terms of trade and are corroborated by per capita consumption data: food intake increased by more than 50%, and clothing consumption doubled. Additional evidence in support of economic growth is presented by Marein (2020a), who finds that economic activity began concentrating in urban areas at the turn of the 20th century, and municipal growth was positively correlated with several indicators of development from 1899 to 1970. Height provides additional information about development because it captures how living conditions changed throughout the entire population; economic growth can fail to translate to improvements in living conditions for vast sections of the population if income inequality rises as well.

In what follows, I first provide a broad overview of economic changes in the early 20th century as well as interventions made under US rule that may have affected the standard of living. I subsequently evaluate height data for Puerto Rican men from three surveys and determine that the economic standard of living rose substantially in the immediate aftermath of US annexation. I also show that Puerto Ricans at mid-century were among the tallest Latin Americans outside of Argentina and Uruguay and were nearly as tall as white Cubans, at which point Cuba was a prosperous, middle-income country. Finally, I summarize and conclude.