When do states arise? When do they fail to arise? This question has generated scholarship across all social sciences. A dominant view is that states first arise when violent actors impose a monopoly of violence in order to extract taxes (Carneiro, 1970, Tilly, 1985). One fundamental fact affects all existing studies: functioning states precede most statistics. There is therefore no statistical evidence on the causes of state formation. As a foundation for this study, I organized the collection of village-level panel data on violent actors, managing teams of surveyors, village elders, and households in 380 war-torn areas of DRC. I introduce optimal taxation theory to the decision of violent actors to establish local monopolies of violence. The value of such decision hinges on their ability to tax the local population. A sharp rise in the global demand for coltan, a bulky commodity used in the electronics industry, leads violent actors to impose monopolies of violence and taxation systems in coltan sites, which persist years after the demand collapses. A similar rise in the demand for gold, easier to conceal and more difficult to tax, does not. My findings support the view that the expected revenue from taxation, determined in particular by tax base elasticity, can explain the first stages of state formation.