Answer:
The State of Bolivia has been a remarkably unsuccessful state. Bolivia is now poor and backward but this was not always the case for the area that is now Bolivia. In pre-Columbian times the high plains, the Altiplano, had an economy based upon irrigated agriculture and was relatively densely populated compared to other areas of South America. At that time the Altiplano was closely linked with the area that is now Peru. Sometimes there were kingdoms of the Aymara-speaking natives of the Altiplano which controlled the Quechua-speaking natives of Peru and at other times the roles were reversed. In the era immediately before Spanish contact it was the Quechua-speaking kingdom of the Inca that controlled the Altiplano and sent Quechua-speaking colonists into the Altiplano such that today the native speakers of Aymara and Quechua language are of equal importance in the population of Bolivia.
Shortly after the Spanish conquest, silver deposits were discovered at Potosà and these silver mines made the region one of the wealthiest and most heavily populated in the Spanish Empire. In 1800 Bolivia had a population that was second only to Brazil among the regions of South America. The wealth however did not trickle down to the native population, who were forced to supply labor for the mines. During the Spanish Imperial era and up until indpendence the area was known as Upper Peru. For a period of time the Spanish authorities decreed that all contact between the provinces of Rio de la Plata (what later became Argentina, Uruguay and Paraguay) should be through Upper Peru (Bolivia). In 1800 Bolivia's population was five times that of Argentina's and 50 percent larger than the population of Chile.
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