Prices and Living Standards during the Age of Revolutions: The Río de la Plata between 1772 and 1830

Abstract

This article examines how Buenos Aires and Montevideo, two cities along the Río de la Plata whose economies were in close contact with the Atlantic markets, experienced changes in consumer prices and the purchasing power of low-skilled urban wages during the Age of Revolutions. It presents comparative evidence on costs of living and welfare ratios elaborated from primary and secondary sources for each city. The main findings are that (a) Buenos Aires and Montevideo show comparable price fluctuations throughout the period; (b) they went through an unusually intense inflationary lapse between 1811 and 1821 spurred by the "wars of independence"; (c) the purchasing power of unskilled workers, which was higher than those of Mexico, Lima, or Bogota at the same time, and comparable to that of middle-income European cities (Allen et al. 2011), declined during the high inflation period, and (d) although purchasing power recovered thereafter, it failed to keep the initial levels in both cities.