Inglorious Revolution: Political Institutions, Sovereign Debt, and Financial Underdevelopment in Imperial Brazil

Yale university press, 2015

Government debt crises are a fact of political and economic life. By the middle of the 19th century most Latin American states had become what modern scholars have labeled "serial defaulters."

Inglorious Revolution shows that Imperial Brazil (1822-1889) was a key exception.  The political institutions of constitutional monarchy provided an effective penalty for default in Brazil, much as they had done in Britain more than a century before. This credibly committed the government to repay its debts. Beginning in the 1820s bankers in London structured Brazil's loans in sterling, while Rio de Janeiro's merchants and slave traders made loans in local currency. Since parliament always budgeted funds to service the debt, Brazil's bondholders on both sides of the Atlantic always received their interest payments. The result was continuous access to capital markets. This achievement constituted nothing less than a revolution in public finance.

Given Imperial Brazil's enviable record of government borrowing, one would expect it to undergo a broad-based revolution in private finance.  This study shows it did not. Restrictive and arbitrary controls over incorporation, and regulatory barriers to entry by banks, created financial underdevelopment. The same political institutions that fostered credible public finance stymied innovation in private capital markets. In terms of its consequences for financial development, Brazil's rupture with absolutist government at independence was an inglorious revolution


"Using a vast array of archival evidence Summerhill convincingly shows that political commitment to a secure public debt was neither necessary nor sufficient to insure financial development in nineteenth century Brazil. A must-read for economic and financial historians and for anyone interested in the politics of financial development."--Jean-Laurent Rosenthal, California Institute of Technology

"A critical weakness of much scholarship on long-run economic development is that it makes generalizations from a few salient histories, usually of European countries. In Britain change in political institutions allowing the government to borrow apparently led to a financial revolution. But this brilliant book shows that exactly analogous political changes in Brazil did not have the same consequences. A Trojan horse in the conventional wisdom."--James A. Robinson, University of Chicago

"Inglorious Revolution addresses a frontier question in political economy: new states need sources of finance, but how can a new state make a credible commitment to its creditors that it will repay its debts? Inglorious Revolution shows that Brazil solved this commitment  problem by creating a constitutional monarchy in which parliament held the reins of power and was composed of a tight knit class of merchants and planters who were the state's creditors. Credibility came at a cost however, because this merchant-planter elite made sure that almost nothing happened in Brazil without their say-so, and they almost never said yes. Nineteenth century Brazil therefore had stable public finances, and avoided the endless coups and civil wars that plagued new states in Latin America and Africa, but it remained economically backward."--Stephen Haber, Stanford University

"This volume is one of the most original studies of 19th century Brazilian public finance published in any language.  It not only provides a wealth of original research material but has raised fundamental issues about why Imperial Brazil’s extraordinary record of international credit in the 19th century did not lead to a major financial and capital development.  Does this unusual case of a credit worthy state which still did not grow provide a useful counterbalance to the theories of economic growth. Summerhill makes a good argument for this thesis and thus the book will prove to be of much broader interest to the field of economic history and economic development."--Herbert S. Klein, Columbia University & Stanford University

"Inglorious Revolution is a welcome contribution to Brazilian economic history. This polished, original book will become the main reference for the study of imperial Brazil for historians and economic historians in the years to come.”Aldo Musacchio, Harvard Business School and Brandeis International Business School

Selected Publications


Inglorious Revolution: Political Institutions, Sovereign Debt, and Financial Underdevelopment in Imperial Brazil (Yale University Press, 2015)

Order Against Progress: Government, Foreign Investment, and Railroads in Brazil, 1854-1913 (Stanford University Press, 2003)


"The Characteristics of Coffee Production and Agriculture in the State of São Paulo in 1905," (with Francisco Vidal Luna and Herbert S. Klein), Agricultural History, vol. 90, no.1 (2016)

"A Agricultura Paulista em 1905," (with Francisco Vidal Luna and Herbert S. Klein), Estudos Econômicos, vol. 44, no. 1 (2014)

"Fiscal Bargains, Political Institutions, and Economic Performance," Hispanic American Historical Review, vol. 88, no. 2 (2008): 219-33

Big Social Savings in a Small Laggard Economy: Railroad-led Growth in Brazil, Journal of Economic History, vol. 65, no. 1 (Mar., 2005), 72-102

"State bank transformation in Brazil – choices and consequences," (with Thorsten Beck and Juan Crivelli), Journal of Banking and Finance, vol. 29, nos. 8-9 (2005), 2223-2257

"Market Intervention in a Backward Economy: Railway Subsidy in Brazil, 1854-1913." Economic History Review, Vol. 53, no. 3 (1998): 542-568


"The New Economic History of Latin America: Evolution and Recent Contributions" (with John H. Coatsworth), in Jose Moya, ed., The Oxford Handbook of Latin American History (Oxford University Press, 2010)

"Credible Commitment and Sovereign Default Risk: Two Bond Markets and Imperial Brazil," in Stephen H. Haber, Douglass C. North, and Barry R. Weingast, eds., Political Institutions and Financial Development (Stanford University Press, 2008)

"Infrastructure," in Victor Bulmer-Thomas, John H. Coatsworth, and Roberto Cortés Conde, eds., The Cambridge Economic History of Latin America, Vol. II, The Long Twentieth Century (Cambridge University Press, 2006)

“Order, Disorder, and Economic Change: Latin America vs. North America,” (with Douglass C. North and Barry R. Weingast), in Bruce Bueno de Mesquita and Hilton Root, eds., Governing for Prosperity (Yale University Press, 2000) [published in Spanish as "Orden, Desorden y Cambio Económico: Latinoamérica vs. Norte América," in Revista Instituciones y Desarrollo, no. 12-13 (2002)]

"Railroads in Imperial Brazil," in John H. Coatsworth and Alan M. Taylor, eds., Latin America and the World Economy in the Nineteenth and Twentieth Centuries: Explorations in Quantitative Economic History (Harvard University Press, 1998)

"Transport Improvements and Economic Growth in Brazil and Mexico," in Stephen H. Haber, ed. How Latin America Fell Behind: Essays on the Economic Histories of Brazil and Mexico, 1800-1914 (Stanford University Press, 1997) [published in Spanish as Cómo se rezagó la América Latina: ensayos sobre las historias económicas de Brasil y México. 1800-1914 (Fundo de Cultura Económica, 1999)]



William Summerhill is Professor of History at UCLA. Most of his research concerns Brazil's economic history, including the political economy of sovereign debt, banking and finance, railroads and the provision of infrastructure, and inequality. He is completing a new book on the role of London bankers and Rio de Janeiro slave traders in state-building in early nineteenth-century Brazil.

He also collaborates with Samuel de Abreu Pessôa and Edmilson Varejão (FGV) in a project on the economic impact of education and education policy in twentieth-century Brazil; with Renato Perim Colistete (FEA-USP) on rural wealth in the nineteenth century; and with Leonardo Monasterio in a big-data, group project on long-run social mobility in Brazil. 

Summerhill holds a PhD in History from Stanford, and an MA and BA from the University of Florida. His research has been supported by the Fulbright-Hays program, the Social Science Research Council, the American Council of Learned Societies, and the National Science Foundation. He has been a consultant to the World Bank and the private sector, and was a National Fellow at the Hoover Institution. Since 2011 he co-edits the Revista de Historia Económica. He has been a visiting research scholar at the Escola de Pós-Graduação em Economia of the Fundação Getúlio Vargas (EPGE-FGV), and a visiting professor at the École des hautes études en sciences sociales, the Universidade de São Paulo, the Universidade Estadual Paulista (UNESP), and Stanford University.


Inglorious Revolution highlighted in Elio Gaspari's column, Folha de S.Paulo and O Globo (excerpted w/out login here), February 2016

Interview by Márcio Kroehn in IstoÉ Dinheiro ("O Brasil tem um estado enorme para um país emergente"), February 2016

Interviewed by Rafael Cariello, on Nathaniel Leff, in "Looking for Leff," revista piauí, January 2016 and June 2016 (edição flip_2016_)(English/Portuguese)

Inglorious Revolution reviewed by Anne Hanley at; Inglorious Revolution profiled in Diário do Comércio by Ulisses Ruiz-de-Gamboa, "Como era solvente meu Império," (March 2016); Inglorious Revolution profiled in Americas Quarterly by Asher Levine, "What a 19th Century Default Says About Brazil's Crisis Today," (Winter 2016); Inglorious Revolution recommended reading at Casa das Garças (February 2016); profiled by the research foundation of the state of São Paulo (FAPESP), "Quem não deve não tem crédito;" interview by Jorge Felix in Valor Econômico"Lições da história econômica;" mention in the Folha de S.Paulo; cited in O Estado de S.Paulo; quoted in the Wall Street Journal; Elio Gaspari profile of research on 19th century railroad subsidy, in Folha de S.Paulo.

Brazil notes

Summerhill, "Brazil's Meltdown," Yale Books Unbound, December 2015

On the gravity of the economic problem that Brazilians face, read Mansueto de Almeida Jr., Marcos de Barros Lisboa, and Samuel de Abreu Pessôa, O Ajuste Inevitável (2015), read this summary, and watch this interview with the authors (in Portuguese; brief summary in English here)

For the origins of Brazil's crisis, read the Insper working paper by Marcos de Barros Lisboa and Zeina Abdel Latif, Democracy and Growth in Brazil (2013) [Casa das Garças conference version here], and an interview on the role of business in creating the crisis ("Empresários também tem culpa").  For a visionary perspective on the reforms that will be required: Marcos de Barros Lisboa and Samuel Pessôa, "As meias-entradas no caminho do ajuste econômico" in Folha de S.Paulo (2016).

Other links

Summerhill Currículo Lattes (CNPq, Brasil)         

Papers at

UCLA faculty page                   

UCLA Center for Economic History