By the sixteenth century, the Incas of South America ruled an empire that extended along the Pacific coast and Andean highlands from what is now Ecuador to central Chile. While most of the Incas were self-sufficient agriculturists, the inhabitants of the highland basins above 9,000 feet were constrained by the kinds of crops they could cultivate. Whereas 95 percent of the principal Andean food crops can be cultivated below 3,000 feet, only 20 percent reproduce readily above 9,000 feet. Given this unequal resource distribution, highland Incas needed access to the products of lower, warmer climatic zones in order to enlarge the variety and quantity of their foodstuffs. In most of the preindustrial world, the problem of different resource distribution was resolved by long-distance trade networks over which the end consumer exercised little control. Although the peoples of the Andean highlands participated in such networks, they relied primarily on the maintenance of autonomous production forces in as many ecological zones as possible. The commodities produced in these zones were extracted, processed, and transported entirely by members of a single group.

This strategy of direct access to a maximum number of ecological zones by a single group is called vertical economy. Even today, one can see Andean communities maintaining use rights simultaneously to pasturelands above 12,000 feet, to potato fields in basins over 9,000 feet, and to plots of warm-land crops in regions below 6,000 feet. This strategy has two principal variations. The first is "compressed verticality," in which a single village resides in a location that permits easy access to closely located ecological zones. Different crop zones or pasturelands are located within a few days walk of the parent community. Community members may reside temporarily in one of the lower zones to manage the extraction of products unavailable in the homeland. In the second variation, called the "vertical archipelago," the village exploits resources in widely dispersed locations, constituting a series of independent production "islands." In certain pre-Columbian Inca societies, groups were sent from the home territory to establish permanent satellite communities or colonies in distant tropical forests or coastal locations. There the colonists grew crops and extracted products for their own use and for transshipment back to their high-altitude compatriots. In contrast to the compressed verticality system, in this system, commodities rather than people circulated through the archipelago."