This document uses an analytic-interpretive perspective to show the role that institutions and social capital have played in the economic performance of different regions, in particular in the department of Cauca, where historical dependence and the colonial heritage have been important causes of low levels of development. To do this, it reviews the colonial legacy of the Gobernacion del Cauca based on historical evidence and stylized facts that reveal the presence of extractive institutions that generated the so-called Gold Cycle and Livestock Cycle.