1 - Latin America and the international economy, 1870–1914

Summary

Introduction

The half-century following the wars of independence in Latin America, that is to say, the period from the 1820s to the 1860s or 1870s, had been generally disappointing in terms of economic growth, although here and there, in the niches of a somewhat ramshackle but nevertheless changing structure, modest material and organizational gains were made. Over the region as a whole, the uneven diffusion of commercialization during the colonial period had left a complex mosaic of capitalist and non-capitalist relations of production, ranging from reciprocal labour networks, slavery, other compulsory labour regimes and debt peonage to share-cropping and various forms of tenant farming, wage labour and small-scale commodity production by artisans and smallholders. Communal ownership of land still existed alongside privately held properties both large and small, while other rural holdings were controlled by ecclesiastical and public authorities. Gradually, however, over the course of several decades, relationships more compatible with capitalist modes of interaction gained ground as long established colonial mechanisms for allocating resources fell into disuse and the world capitalist system expanded. A half-century of incremental change had not been enough to transform the economic organization of Latin America, but it did sufficiently alter conditions for the more sweeping institutional and technological developments of 1870–1914 to get under way.

The regulatory systems established during the colonial period were being dismantled at the same time as public administration was breaking down and new, sometimes contested, national boundaries were being drawn. These developments disrupted local commerce and in many instances halted the former inter-regional (but by then inter-country) currents of trade within Latin America, while the strong gravitational pull of the expanding North Atlantic economies reoriented economic life towards a slowly growing participation in global trade no longer determined by Iberian commercial policy.