Latin American Growth-Inequality Trade-Offs: The Impact of Insurgence and Independence

Abstract

Did independence push Latin America down a growth-inequality trade-off? During the late colonial decades, the region completed two centuries of growth unmatched anywhere and inequality reached spectacular heights. During the half century after insurgency and independence, inequality fell steeply and growth was so modest that the period is called the lost decades. With the appearance of the belle époque in the 1870s, growth rose to impressive levels, again even by world standards, and inequality surged to the highest levels ever, where they have remained for a century. This paper explores the connection.

Latin American Inequality in the Long Run

“…Even more, he argues that this process of empowerment yielded the belle époque liberal reforms that made fast post-1870 growth possible. Although Coatsworth did not make the point, the new institutional economic history can also be criticized for almost completely abandoning the role of international relations as an important force by which domestic inequalities are strengthened and sometimes overturned (Bértola 2010; Williamson 2010), a central pillar of the earlier tradition.…”

Structural Change and the Fall of Income Inequality in Latin America: Agricultural Development, Inter-sectoral Duality, and the Kuznets Curve

“…During the socalled belle époque ) the commodity boom enriched the landowning elite and marked a turning point upward in the evolution of income inequality in the region (Williamson 2010a). During the period increasing international demand and declining costs of transportation promoted the expansion of the export sector, but labor mobility was constrained by the residuals of slavery and encomienda systems, let alone the repression of organized labor and the impact of European immigration in the Southern cone (Frankema 2009;Kay 2001;Williamson 1999;BulmerThomas 1994, p. 87;Bauer 1975).…”