Exceptional Argentina Di Tella, Glaeser and Llach - Thomas Piketty

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one area (the metropolitan area of the city of Buenos Aires). Thus, our paper needs to innovate from a methodological point of view relative to previous work, by finding a way to obtain identification when only data from one region is available, something we do by using individual price indexes by household. Given that the book focuses on a more historical approach to the issue of Argentina exceptionalism, we have chosen to provide the methodological description of the literature and of our approach in the appendixes. The interested reader should move to those sections now, while those not so concerned about methodological issues can move to the results, which are presented in the next section. 3 Results 3.1 Data As we mentioned above, Argentina has relatively few consumption expenditures that are publicly available. Thus, we only had access to the Survey of household Expenditures of 1985/1986 (Encuesta de Gasto de los Hogares 1985/86, EGH85/86), the National Survey of Household Expenditures 1996/1997 (Encuesta Nacional de Gasto de los Hogares 1996/97, ENGH 96/97) and National Survey of household Expenditures 2004/2005 (Encuesta Nacional de Gasto de los Hogares 2004/05, ENGH 04/05). The EGH 85/86 took place in the city of Buenos Aires and its metropolitan area. For the ENGH 2004/05 we only have data for the city of Buenos Aires. We start our analysis of this data in Figure 2, with a brief illustration of some basic statistics for the three household surveys. There, we show expenditure shares on different types of goods, as a function of income levels. Each curve depicts one the three surveys for which we have data. Some straightforward conclusions may be inferred from the figure. First, that the relation between food and income is negative, indicating that food is a basic good. More so, not only can we see that the share of food falls systematically as we move upwards in income, but that the shares fall for each later survey. To the extent that Engel curves are stable, this would clearly indicate that income levels increased uninterruptedly throughout the period. With the exception of housing, the shares of the remaining composite goods tend to increase with income. For a non Argentinean perhaps it is surprising how much Education expenditures increase with income, a result that originates on the much higher use of private education among higher income levels.
Figure 2. Basic Statistics Food Clothing Housing 60% 12% 25% 50% 10% 20% Percentage of Total Exp. 40% 30% 20% Percentage of Total Exp. 8% 6% 4% Percentage of Total Exp. 15% 10% 10% 2% 5% 0% 1 2 3 4 5 0% 1 2 3 4 5 0% 1 2 3 4 5 Quintil Expenditures Quintil Expenditures Quintil Expenditures EGH 1985/86 ENGH 1996/97 ENGH 2004/05 EGH 1985/86 ENGH 1996/97 ENGH 2004/05 EGH 1985/86 ENGH 1996/97 ENGH 2004/05 Household Equipment & Manteinance Health Transport & Comunications 10% 12% 18% 9% 16% 8% 10% 14% Percentage of Total Exp. 7% 6% 5% 4% 3% Percentage of Total Exp. 8% 6% 4% Percentage of Total Exp. 12% 10% 8% 6% 2% 2% 4% 1% 2% 0% 0% 0% 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 Quintil Expenditures Quintil Expenditures Quintil Expenditures EGH 1985/86 ENGH 1996/97 ENGH 2004/05 EGH 1985/86 ENGH 1996/97 ENGH 2004/05 EGH 1985/86 ENGH 1996/97 ENGH 2004/05 Recreation Education Other good & services 12% 6% 7% 10% 5% 6% Percentage of Total Exp. 8% 6% 4% Percentage of Total Exp. 4% 3% 2% Percentage of Total Exp. 5% 4% 3% 2% 2% 1% 1% 0% 0% 0% 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 Quintil Expenditures Quintil Expenditures Quintil Expenditures EGH 1985/86 ENGH 1996/97 ENGH 2004/05 EGH 1985/86 ENGH 1996/97 ENGH 2004/05 EGH 1985/86 ENGH 1996/97 ENGH 2004/05 To check the consistency and quality of the data, Table 1a shows the main demographic characteristics for each survey. The table shows that the data is fairly homogenous but that over the period of the three surveys Argentina has experienced a reduction in household size, a larger share of females in the labor force, and an increase in the number of single parents’ households. Table 1a. Demographics EGH 85 / 86 ENGH 96 / 97 ENGH 04 / 05 Mean S. D. Minimun Maximun Mean S. D. Minimun Maximun Mean S. D. Minimun Maximun Share of food 0.45 0.17 0.01 1.00 0.40 0.17 0.01 1.00 0.31 0.14 0.00 0.95 Relative price of food and non-food 1.09 0.20 0.52 1.69 1.06 0.03 0.95 1.17 1.17 0.06 0.99 1.39 Household expenditure 1,601.0 1,334.7 100.9 13,929.3 1,011.6 947.5 2.2 12,792.5 1,375.9 1,196.9 52.1 15,337.8 Household income 1,657.6 1,447.4 0.0 23,933.0 1,202.4 1,118.6 0.0 14,980.3 1,490.2 1,521.9 0.0 29,779.5 Household size 3.58 1.70 1 13 3.46 1.96 1 17 2.61 1.46 1 12 Percentage of pop. in Capital Federal 35% 48% 0% 100% 30% 46% 0% 100% 100% 0% 100% 100% % of members ages 0 to 4 0.08 0.14 0% 67% 6% 12% 0% 67% 4% 11% 0% 67% % of members ages 5 to 9 0.08 0.14 0% 67% 6% 12% 0% 67% 4% 11% 0% 67% % of members ages 10 to 15 0.07 0.13 0% 75% 6% 12% 0% 75% 4% 10% 0% 75% % of members ages 15 to 19 0.06 0.13 0% 75% 7% 14% 0% 100% 4% 12% 0% 100% Male head 83% 38% 0% 100% 74% 44% 0% 100% 64% 48% 0% 100% Spouse present 78% 42% 0% 100% 68% 47% 0% 100% 55% 50% 0% 100% Head has a job 75% 43% 0% 100% 65% 48% 0% 100% 72% 45% 0% 100% Spouse has a job 24% 43% 0% 100% 24% 43% 0% 100% 30% 46% 0% 100% Head and spouse have both a job 22% 41% 0% 100% 19% 39% 0% 100% 28% 45% 0% 100% Owner occupied 75% 43% 0% 100% 71% 45% 0% 100% 61% 49% 0% 100% Free housing occupied 11% 31% 0% 100% 15% 36% 0% 100% 11% 31% 0% 100% Observations 2,703 4,867 2,814 Weigthed sample 2,885,720 3,224,364 1,127,851 To compare the nominal variables we use the CPI to bring them to a comparable basis (in the table all prices are expressed in 1999 pesos). The table shows that, according to the data, income levels decrease quite sizably between the 85/86 wave and the 96/97 sample. Notice that during the same period (see Figure 2) there is an unambiguous
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Exceptional Argentina Di Tella, Gla
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A third explanation of Argentina’
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Maddison's "Western Offshoots" by l
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A final point on this mechanistic a
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GDP in 1900 at 12,100 (in constant
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nationalized railways and banks, to
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country interacted with initial con
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1900. As there is an extremely stro
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Between the 1940s and 1970s income
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particularly in terms of food consu
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Even before the 2001 crisis, Argent
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Scandinavia and Northern Europe the
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Figure 4. A modified Human Developm
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Figure 6. Per capita GDP across Arg
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production 15 . Moreover, beyond st
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Figure 10. Average weight of export
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etween the prewar export-led growth
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which was wholly bound to local dem
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protectionism", certainly stronger
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agricultural pastures and cropland
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far. Argentina's differential popul
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Appendix Figure A. 1. Argentina's r
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Peru 35 38 25 34 34 34 32 29 26 27
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Like the Llach paper, the Campante
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I. Introduction Both Buenos Aires a
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across the ocean. Over the course o
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Buenos Aires’ hinterland rose dra
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significantly greater education lev
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Why is there such a difference in l
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illion dollars today). Each Chicago
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Chicago also appears to have been a
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casualties. Roca secured the presid
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capital to St. Petersburg he was pr
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and the logarithm of per capita GDP
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Moreover, years of schooling today
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y its overwhelming political import
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200 Figure 2a: Annual Wage Data 187
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Figure 3: Real Monthly Wages in Chi
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Log GDP per capita 2000 5 6 7 8 9 1
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Figure 7 Log GDP per capita 2000 7
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Table 2: Top 5 Industries in Chicag
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Table 4: 19th Century Variables and
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A simple calculation suggests that
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toy model with a minimum of paramet
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were lifted, but import taxes remai
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to compute that the MPK term above
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versus foreigners, on most occasion
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X institutions policies income p
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series variation. The coincidence o
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Figure 1—The Great Divergence and
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Figure 3—Trade taxes
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Transition Remarks The previous ess
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CHAPTER FOUR Argentine Trade Polici
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Argentine comparative advantage lie
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thousands of product lines in Argen
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Japan). Third, the agricultural pro
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different preferences over trade pr
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two nomenclatures had to be manuall
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esult, soybeans were finally adopte
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Figure 1 Trade Openness Exports + I
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Figure 5 Relative Sectoral Protecti
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Figure 7 Average Export Taxes 0 10
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Figure 9 Average Export Taxes at 2-
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Figure 11 Evolution of Argentine Ag
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Figure 13 Yields in Agriculture: Wh
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Table 2 Livestock per Capita 1895 C
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Table 5 Mean Share of Exports (Impo
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Table 7 Tariff Statistics for perio
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Table 9 Evolution of Industrial Pro
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CHAPTER FIVE Path-Dependent Import-
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actors, and they were demanding pro
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the primary sector, using land and
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Figure 1: The Long Run: Four Region
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Finally, in the reversal of pattern
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Figure 3: Medium Run Preferences ov
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sector to give rise to a protection
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technological improvements or incre
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Argentina did relatively well when
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World War, a second globalization e
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Argentine primary sector and ensure
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Clearly, world market conditions we
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for the years to come. The most imp
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governments zigzagged in their poli
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public spending on infrastructure s
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understand the rise of the urban-ru
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To sum up, by the beginning of the
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has a comparative advantage in the
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L λ = m L K κ = m K That is, λ i
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K c a = 1− α 1−α T A ( κ )
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Given a set of parameters ϒ , φ a
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consumption of good i. For any agen
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Proposition 3 In the short run, pro
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ρ 1/ 1 ρ ρ 1 ( ξ ξ ) 1 TT K ,
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Up to 2008, the FPV government had
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negative correlation between the pr
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policies would, supposedly, eviscer
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I. Introduction In a seminal study,
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terms, Peronist beliefs in the 1990
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Several authors have emphasized the
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foreign capital and trade as the gl
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of already available information. A
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having the need to do more than wak
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Argentines (who implement these pol
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opinion about elements of capitalis
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intense (the proportion is under 1.
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involved in social ordering that wi
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cost of the deviating firm, since w
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Admissible Region Bounds on w b Nex
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The previous proposition may be par
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and note that Peron insists on the
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Appendix 2: Definitions of Variable
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Table II: The Beliefs of Peronists
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Transition Remarks The previous cha
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CHAPTER SEVEN A Short Episodic Hist
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the income distribution between 193
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empirical evidence and on existing
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of commodities. The country was off
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accounts increased by 8% between 19
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Argentina in 1942 (4.1%) is not ver
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This change in inequality is also r
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1982, when Mexico’s default on it
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1995. While growth bounced back qui
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The main characteristics of this ep
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skilled workers that more than offs
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Household Expenditure Survey. An in
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Page 259 and 260: even when the number of well-off in
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Page 263 and 264: This chapter described the level an
Page 265 and 266: Transition Remarks Economic success
Page 267 and 268: CHAPTER EIGHT Why do Argentines tru
Page 269 and 270: in the 1970s and 1980s. Despite the
Page 271 and 272: Figure 5. Percentage of the populat
Page 273 and 274: analysis of the Argentinean and Chi
Page 275 and 276: observationally equivalent individu
Page 277 and 278: the low rank policeman. 13 4. The C
Page 279 and 280: Figure 7. Share of people having a
Page 281 and 282: 6. Why did the Argentinean Police d
Page 283 and 284: instability, σ, a worried leader h
Page 285 and 286: the deeper question of why the Arge
Page 287 and 288: Table 2. Comparative facts for cano
Page 289 and 290: of formal education, whereas in the
Page 291 and 292: only bargaining tool to get money.
Page 293 and 294: Table 6. Tierra del Fuego Subinspec
Page 295 and 296: 4. Police deaths during the 20th ce
Page 297 and 298: Of course, these conclusions depend
Page 299 and 300: “stop go” dynamics 4 ). In fact
Page 301: income distribution and earnings gr
Page 305 and 306: Table 2 Dep. Var.: Share of food Sm
Page 307 and 308: Figure 3. Variety in food retailing
Page 309 and 310: Table 3 Dep. Var.: Share of food at
Page 311 and 312: 3.3 Income distribution effects The
Page 313 and 314: Figure 6. Individual Effects Using
Page 315 and 316: Expenditure Income 5000 6000 4000 4
Page 317 and 318: Figure 10. Income distribution Dens
Page 319 and 320: Appendix A: Estimation strategy Est
Page 321 and 322: w ijt where [ ln( 1+ ∏ ) − ln(
Page 323 and 324: 2.2 Income distribution effects Fol
Page 325 and 326: Appendix B: The data To run our est
Page 327 and 328: Appendix C: Additional tables C1: B
Page 329 and 330: C3: Table 3 coefficients Dummy for
Page 331 and 332: CONCLUSION 20 th century Argentina
Page 333 and 334: can be harbingers of worse things t
Page 335 and 336: Ahumada, Hildegart, Alfredo Canaves
Page 337 and 338: Barro, Robert J. 2005. “Rare Even
Page 339 and 340: Burzaco, Eugenio et al. 2004. “Ma
Page 341 and 342: Cortés Conde, Roberto and María M
Page 343 and 344: Di Tella, Rafael, Juan Dubra and Ro
Page 345 and 346: Gaggero, Horacio and Alicia Garro.
Page 347 and 348: Gerchunoff, Pablo, Fernando Rocchi
Page 349 and 350: James, Daniel. 1988. “October 17
Page 351 and 352: Maddison, Angus. 2006. The World Ec
Page 353 and 354:
Piketty, T. 2003. “Income Inequal
Page 355 and 356:
Spiller, Pablo and Mariano Tommasi.
Page 357:
Williamson, Jeffrey G. 1995. “The
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