Economic

Modernization
1880 to 1920
LAH 2020
 Economic and Industrial
transformation
• Important transformations taking place in the
world economy
• Europe and USA – industrial nations
• Population grew dramatically
• Prices of primary export products were high
• Manufactured imports from Europe were lower in
price
• Latin American nations, in terms of trade,
benefited from the industrialization of Europe
 COST – DEPENDENCY
• dependent on foreigners (nations) for
manufactured goods.
• Difficult for the Latin American nations did
not go through the slow and progressive
advance in science and technology
needed toward ‘mechanized production’
that Great Britain, France, Germany, and
the US experienced
 Mexican manufacturing
• Success story in industrialization achieved in
Mexico – mills for spinning and weaving cotton
near Puebla, state of Veracruz
• Why? Large size of buying population – a
market
• Presence of skilled artisans (initial work force)
• Available start-up capital from the Government
• An investment bank – Banco de Avío was set up
in 1830s to provide funds for textile manufacture
 Expansion of Latin American
exports
• Increased demand in raw materials
• Metals – examples: copper and tin
• 1900 – Oil reserves found, Gulf coast of Mexico
• Rubber boom years (late 1890s) – wild rubber
trees in Amazon region – Brazil, Peru
• Henequen – sisal in the Yucatan
• Bananas – Ecuador and Central America
 Exports from LA
• Demand rose for traditional products from Latin
America – eve of the First War
• Argentina and Uruguay exported hides and
meats
• Uruguay – leading export product was wool
• Argentina – grains; maize and wheat
• Paraguay – yerba mate (internal market in South
America)
• Ecuador – cacao
 Imports into Latin America
• Great Britain – major seller of goods, by 1913
US overtook most of that trade
• USA 25.5 %
• Great Britain 24.8%
• Germany 16.5 %
• France 8.3%
• Great Britain dominated the market – textiles
and clothing
• US sold more industrial products, mainly mining
and farming machinery
• Main destination was Mexico
 Changes in LA
• Rise in the population of the region.
• Export boom contributed to the national wealth –
not large enough to bring dramatic.
• Improvements in living standards to all.
• Land tended to be concentrated in large estates
– haciendas or latifundios
• Railroad construction – built to save costs of
moving crops (final products) to the ports, where
distance made it more expensive for transport
 Labor patterns
• Labor was scarce in most countries
• Slavery persisted in two countries – Brazil
and Cuba
• Chinese – brought to work in RR in Costa
Rica and Peru
 European immigration to LAH
• Large European population came (late 19th
century and early 20th century)
• Between 1871 and 1915 about 2.5 million
Europeans came
• Argentina – 80% from Italy and Spain
• Argentina, Brazil and Uruguay – national policy
to attract Europeans to emigrate
• Financial aid offered as an incentive to move
• Objective not only to enlarge the labor force but
to ‘raise’ the level of national culture Europe
perceived as the source of ‘true’ civilization
 POSITIVISM
• Theory of social engineering by
government
• Europeans perceived as “advanced” in
terms of progress
• Thus European immigration – a shortcut to
“modernization” and “development”
• Immigrant settlement of less populated
rural areas resulted in the rise of
prosperous small farming – example,
Patagonia region of Argentina and Chile