How were the initiative, referendum and recall processes establishedthis is an open ended question.

Initiative, referendum and recall processes are collectively called the politics of direct action.

People use these three means to bring their will to the legislature and governmental pages directly. Initiative and referendum existed in the United States since the 17th century when Thomas Jefferson in 1775, proposed that citizens should be capable of making amendments in laws proposed by  officials.  

By the late 19th century, the progressive and populist movements brought awareness among people that they should push the state legislature to make an amendment in the law and allow people for initiative and referendum processes.