Rural Ecuador had functioned under the huasipungo land-tenure system since the 16th century. The tenant farmers, called huasipungueros, were mainly of indigenous descent and worked 3 to 6 days a week on hacienda estates in the highlands, owned by absentee elite white families. In exchange for their labor, the laborers received a small plot of land for subsistence, access to pasture land for cattle, and a small cash wage. The indigenous farmers were highly attached to their land although their plots were still owned by the hacienda.
Beginning with the cacao surge during the 1870s, the conservative landowners in the Sierra and liberal exporting bourgeoisie in the Coastal region had fought for control of Ecuador. Indigenous and lower class Ecuadorians quickly became marginalized, and were extremely frustrated by this by the early 1900s. By this time, Ecuadorian politics and politicians were known to be corrupt and both the lower and even upper classes of society were disenchanted. This was only exacerbated by tough economic times, as the 1929 US Stock market crash greatly affected the Ecuadorian economy.