This paper studies the short-term and the long-term economic consequence of Qing’s policy of bureaucratization of native officers in Southwest China. We find that, in Qing Dyansty, the population density and human capital are both higher in those regions which were transformed into the direct governance than those regions which were not. These reuslts have persistence effect after Qing Dyansty. In 1990, the population density, average income of rural residences, and infant survival rate are higher in those regions which were transformed into the direct governance earlier in Qing Dynasty than those which were transformed later. The positive effect of the policy on economic development was caused by both the immigration from the inland after political intergration, and more efficient provision of public good by the local government. Thus, this paper not only provides empirical evidence for Machiavelli’s governance problem in a culturally heterogeneous nation, but also proposes new direction for understanding the economic inequality in the frontier.