Abstract
At the beginning of the twenty-first century, Latin America has experienced its most notable period of economic expansion since the 1970s, when the predominant model of development was the state-led industrialization. The objective of this chapter is to analyze the industrial performance of Argentina, Brazil, and Mexico (the three most industrialized countries of the region) during the 2000s, taking into account not only the global changes that have occurred in capitalism in the last decades but also the impact of the industrial policies applied, the role of the state, the level of economic concentration, as well as the main challenges these countries will face in the years to come.
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Notes
- 1.
As opposed, the economic reform that was implemented in the 1970s and 1980s in order to promote growth did not bring the expected results. During the ISI period, the economy grew at above-average rates and expanded its share in world production, which rose to 9.5% by 1980. Since then, Latin American economies share in global GDP fell back to 8% and it has continued to slip gradually ever since (Ocampo 2013).
- 2.
A critical analysis of the term “globalization” can be found in Chilcote (2002).
- 3.
The influence of multilateral development institutions in Latin America has varied significantly over time and across countries, for different social, political, and economic reasons. A detailed examination of the process can be found in Perry and García (2017).
- 4.
The chains are “global” since the links in the production process pass through different countries. The term “value” is used to express the fact that each firm adds a certain degree of value to the final product.
- 5.
Frequently, the PPP method is used when making international comparisons, in order to measure how much a currency can buy—generally, taking into account a common basket of goods and services—relative to other currencies. One of the positive aspects of this method (which, like the rest, is not perfect) is that it is considers the relative cost of living and the inflation rates of the countries; rather than using only exchange rates, which may distort the real differences in income considering the fluctuations that may occur between currencies.
- 6.
Argentina was never among the ten most important countries in the world according to its GDP.
- 7.
According to Mckinsey (2018), it is consistent with history that a debt crisis that began in the private sector shifted to governments in the aftermath. That was exactly what happened in the last global crisis. For example, public debt in advanced countries increased from an actual debt-to-GDP ratio of 69% in 2007 to 105% in 2017.
- 8.
It includes FDI, equities, debt securities, lending, and other investment.
- 9.
From 185% (2007) to 183% (2016).
- 10.
In that respect, Peres (2013, 38) considers that the loss of legitimacy of industrial policy did not occur homogeneously in all regions. In fact, it was much pronounced in Latin America.
- 11.
According to Alvarado and Padilla (2017, 404), the transition from the import substitution model to the export-oriented growth model resulted in a structural change in three dimensions: (1) and increasing share of foreign trade to GDP; (2) a significant transformation of the export basket, from one dominated by primary products to one concentrated in medium and high technology manufactures, and (3) a reconfiguration of value added within the large sectors (manufacturing and services).
- 12.
The industrial products export share were just one-third of total exports during the period under analysis. As we will see, this percentage is lower than the manufacturing export share of Brazil, and particularly, Mexico.
- 13.
Mexico’s GDP contracted by 5% in 2009.
- 14.
In the last year of this sub-stage the GDP plummeted almost 4%.
- 15.
For further information about the technological and industrial policy in Argentina during the 2000s, see Lavarello and Mancini (2017).
- 16.
See Wylde (2012) for a detailed analysis of the Brazilian developmental regime under Lula’s term.
- 17.
For further information about industrial policies in Brazil, see Laplane and Laplane (2017).
- 18.
Following the methodology elaborated by Porta et al. (2014). It classifies all groups of activities according to the International Standard Industrial Classification of All Economic Activities (ISIC Rev. 3.). In particular, we breakdown section D (Manufacturing ), which includes divisions 15 to 37, and then we classify all groups of branches to three digits in six main categories. The resulting categories are: food, beverages , and tobacco (which includes the groups 151, 152, 152, 154, 155, and 160); labor intensive (groups 181, 191, 192, 201, 202, 221, 222, 281, 289, 361, and 369); natural resource intensive (groups 171, 172, 173, 210, 261 and 269); chemical and basic metals (groups 241, 242, 271, 272, and 273); automotive (groups 251, 252, 341, 342, and 343); and capital intensive (groups 291, 292, 293, 300, 311, 312, 313, 314, 315, 319, 322, 323, 331, and 332). The rest of the products are part of the seventh category “Rest non-manufacturing activities”.
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Santarcángelo, J.E., Padín, J.M. (2019). The Evolution and Challenges of Latin American Industrial Development in the Twenty-First Century: An Analysis from Argentina, Brazil, and Mexico. In: Santarcángelo, J. (eds) The Manufacturing Sector in Argentina, Brazil, and Mexico. Palgrave Studies in Latin American Heterodox Economics. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-04705-4_5
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