This study provides an explanation of the different pathways of agricultural change and economic development in north and south Vietnam. It shows that pre-colonial factor endowments conditioned the development of the rice economies of the two deltas in Tonkin and Cochinchina. The study relates to, and deviates from, the new literature on the colonial origins of contemporary development (Acemoglu, Johnson and Robinson; Engerman and Sokoloff), and proposes an alternative understanding of how historical processes of economic transformation are shaped. The analysis revives the factor endowment approach (Boserup, Myint), re-interprets an old and controversial debate (Moral Economy versus Rational Peasant), and presents a new understanding of extraction in colonial times (based on Milanovic, Lindert and Williamson). The study’s theoretical interpretation of scant empirical data suggests that factor endowments conditioned the surplus capacity and shaped the institutional arrangements, which affected the equality of opportunity for the majority of rice farmers.