Argentina's Economy
Once Among the Richest
How Argentina was one of the world's richest countries around 1900, built on beef and grain exports, and the long puzzle of its relative decline.
Around 1900, Argentina was among the world’s richest countries per person, by some estimates.
The golden age
- Exports of beef, wheat and wool from the fertile Pampas to Europe.
- Refrigerated ships from the 1870s-80s made beef exports possible.
- British investment in railways.
- Immigrants from Italy and Spain.
Buenos Aires
Buenos Aires was nicknamed the “Paris of South America”, with grand avenues and opera houses.
Decline
Over the 20th century, Argentina fell behind countries like Australia and Canada, which had similar resources.
Explanations
- Political instability and military coups.
- Inward-looking policies after the 1930s.
- Chronic inflation and debt crises.
- Weak institutions.
- Over-reliance on commodities.
A famous quip
Economist Simon Kuznets reportedly said there are four types of countries: developed, underdeveloped, Japan and Argentina.
In 1900, Argentina and Australia had similar incomes from similar exports. A century later, Australia was far richer.
It was among the richest around 1900.
- Argentina was among the richest countries around 1900.
- Beef and grain exports built its wealth.
- It declined relative to similar countries.
- Instability, inflation and weak institutions explain much.
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