Economic organization of the Inca Empire (Tawantinsuyu)

The economic organization of the Inca Empire of Tawantinsuyu was fundamentally different from that of the contemporary states of Europe or Asia. There were no markets in the modern sense, no coinage, no private property in land, no banks, and no mercantile classes. The Inca economy was a redistributive system in which the state controlled the principal resources of the empire — land, labor, and the products of specialized crafts — and redistributed them in accordance with customary obligations, ritual requirements, and state priorities. The system was developed under the emperors Pachacuti and his successors into one of the most comprehensive pre-industrial economic systems in the world, sustaining an empire of more than ten million people on the eve of the Spanish arrival. It did so without money, draft animals, wheeled vehicles, or a writing system. The institutional infrastructure that made this possible — the mit’a labor draft, the ayllu kinship group, the qollqa storage network, the Qhapaq Ñan road system, and the quipu — is the proper subject of any analysis of the Inca economy.

Land Tenure and the Ayllu

The basic unit of the Inca economy was the ayllu, a kinship-based community that held land collectively and provided labor service to the state. Each ayllu held three types of land in roughly equal proportions. The first, sapsi or suytu, was worked collectively to produce food for ritual and communal feasts. The second, ayllu pampa, was allotted to individual families on the basis of need, worked by the family and yielding produce for household consumption. The third, inca pampa or state land, was worked by members of the ayllu as part of their obligation to the state, with the produce going to the imperial granaries. Land was not bought or sold; households held their allotments at the pleasure of the ayllu, administered by hereditary ayllu leaders responsible to higher officials appointed by the Sapa Inca.

The system was supplemented by mitma (also mitmaq) — the forced resettlement of whole communities from one part of the empire to another. Mitma communities were given land, tools, and seed by the state, exempted from many local labor obligations, and used to develop new agricultural lands, to work mines, and to staff administrative centers. They were, in effect, imperial garrisons in civilian form, and they were a key tool of the provincial administration of the empire.

The Mit’a Labor Draft

The economic engine of the empire was the mit’a labor draft, a rotating obligation by which each ayllu was required to provide a quota of adult men for state work. The mit’a was distinct from the labor owed to the ayllu itself; it was owed to the state, and it staffed the construction of roads, terraces, and buildings; state farms, mines, and workshops; military service; and a wide range of other public duties. The system was the Inca equivalent of taxation in kind, and it was the principal means by which the state extracted the resources it needed to operate.

The mit’a was carefully administered. The quipu was used to record the obligations of each ayllu, the quotas due from each household, and the work performed. Provincial officials known as tucuy ricuj (“he who sees all”) supervised the allocation of labor. In normal years, a household might lose one or two of its adult members to the draft for part of the year; in years of heavy construction or military mobilization, the demand could be much greater. The burden could be considerable in newly incorporated provinces, in highland mining and quarrying regions, and in areas where large state projects were underway. The system was also used for state-sponsored construction — the great road system, the fortress-ceremonial centers such as Sacsayhuamán and Coricancha, the qollqas, the irrigation canals and terraces, and the royal estates of the Sacred Valley.

The Redistributive Economy

The Inca economy had no markets in the modern sense. The principal mechanism of distribution was the state itself. Surplus production was collected by provincial officials and stored in the qollqa network, the great state granaries that dotted the empire. From these stores the state drew the food and raw materials needed to support armies, to provision state farms and workshops, to feed populations during famine, and to provide the lavish hospitality of the imperial court. A portion of the stored surplus financed religious festivals, the mummified ancestors of past emperors, and the elaborate ritual calendar of the state cult.

Within the limits set by the state, reciprocal exchange continued to operate at the local level: households exchanged labor and goods with their kin and neighbors, and local communities held markets at which goods could be bartered. The state tolerated and even encouraged local exchange, as long as it did not interfere with the obligations of the mit’a. The state also organized large-scale festivals at which the redistributive economy was put on display — feasts, drinking bouts, and ritual occasions at which the population received food, drink, and clothing from the state. The role of specialized crafts was also important: the state organized the production of textiles, metalwork, ceramics, and featherwork in workshops staffed by yana and mamacona communities. The finest products — the cumbi cloth of the imperial court, the gold and silver objects of the Coricancha, the feather tunics of the royal panacas — were reserved for the state and the religious establishment; less refined products were distributed as part of the mit’a, paid as wages to state laborers, and given as diplomatic gifts.

The State Storage System

The state storage system, organized around the qollqa, was the most distinctive feature of the Inca economic infrastructure. The Incas built thousands of storage facilities across the empire, ranging from small village granaries to great administrative storehouses capable of holding hundreds of tons. The most famous surviving example is the qollqa complex at Huánuco Pampa, a planned city in the central highlands with more than five hundred storage buildings. The state used the network to smooth seasonal variation in food supply, to provision armies and labor drafts, and to provide relief in times of famine. The system was efficient by the standards of the pre-industrial world, and it was one of the most important reasons the Inca state was able to govern such a large and diverse population. The qollqas also served as tribute collection points and as redistribution centers for the products of state-sponsored crafts.

The Absence of Money

One of the most striking features of the Inca economy was the absence of money in the European sense. There were no coins, no paper money, no bills of exchange, and no banks. The economy was based on labor obligation and physical redistribution, not on monetary exchange. The state did not pay wages in the modern sense; it supplied food, clothing, and tools to laborers as part of the mit’a obligation, and it expected the population to grow most of its own food on the lands of the ayllu. The closest thing to money was the cumbi cloth produced in state workshops, which was used as a kind of standard of value for paying state laborers, for diplomatic gifts, and for the fines imposed by state courts. But even cumbi cloth was not a true currency: it was a physical good produced and distributed by the state, and it was not used as a general medium of exchange. The Inca state simply did not need money to do what states normally do, because it had other, more direct mechanisms of resource extraction.

The Limits of the Inca Economy

The Inca economy, for all its institutional sophistication, had important limits. It could not produce a sustained increase in productivity per worker, because it relied on the extraction of surplus labor rather than on technological change. It could not easily integrate the very different ecological zones of the empire into a single market, because there were no markets. And it could not easily respond to local variations in demand, because the redistributive system was based on a fixed schedule of obligations rather than on price signals. These limits did not matter much in a relatively stable pre-industrial empire, but they became critical when the empire was struck by the epidemic disease of the 1520s, and again when the Spanish conquest disrupted the ayllu system and seized the state’s lands and labor. The collapse of the Inca state in the 1530s was, in this sense, the collapse of an economic system as much as the collapse of a political one.