Influential arguments hold that extractive colonial institutions were bad for long term development because of the absence of protections for individual property rights. However, sometimes extractive colonial institutions did increase property rights, with negative developmental consequences. We focus on the case of colonial Mozambique, where the Portuguese government enforced a policy of extremely coercive cotton cultivation in between 1926 and 1961. Using a spatial regression discontinuity approach, we demonstrate significant negative effects of the cotton concessions on a range of present day development outcomes, including various indicators of health, education, wealth, and access to public services such as electricity and water. Yet we also show that, somewhat counterintuitively, rates of land and home ownership are significantly higher inside the former concession areas. We argue that the negative developmental effects of the cotton concessions result from the adverse impact of private property rights on the ability of customary authority to facilitate development. We explore the validity of this mechanism through further analysis of the effect of the concessions on attitudes towards customary authority.