Staple Products, Linkages, and Development: Evidence from Argentina

Abstract

We investigate how historical patterns of primary production influenced development across local economies in Argentina. Our identification strategy exploits exogenous variation in the composition of primary production induced by climatic features. We find that locations specializing in ranching had weaker linkages with other activities, higher concentration in land ownership, lower population density, and less immigration than cereal-producing areas. Over time, ranching localities continued to exhibit lower population density, and they experienced relatively sluggish industrialization. Ultimately, ranching specialization had large negative effects on long-run levels of income per capita and human capital.

Property Rights to Land and Agricultural Organization: An Argentina-United States Comparison

“…The difference may have plausibly originated in geo-climatic differences, in line with Engerman and Sokoloff (2002). Moreover, Droller and Fiszbein (2021) show that variation in ranching specialization across localities in the Argentine Pampas is partly explained by geo-climatic conditions. But it could also be the case, beyond the influence of geo-climatic factors, that large Argentine landowners in 1914 specialized in ranching to maintain their extensive properties with lower monitoring costs as they shifted back and forth into grain production.…”

“…Table 1 shows comparison statistics for the Argentine sample as well as the baseline and extended US samples and the entire U.S. east of the 98th Meridian, the line typically considered the division between the humid and semi-arid regions of the country. We use number and size of farms, number of farms operated by owners, renters, and rental agreement types, and number of cattle from the 1914 Argentine national census digitized by Droller (2018) and Droller and Fiszbein (2021) and data from the 1910 United States Census of Agriculture digitized by Haines (2010). The data are at the county level for the U.S. and at the equivalent level (departamentos or, for the province of Buenos Aires, partidos) for Argentina.…”