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Winners and losers in the allocation of credit during the era of import-substitution industrialisation in Colombia, 1940–1967

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  • Carlos Andrés Brando

Abstract

This paper examines the structure and dynamics of institutionalised flows of credit between economic sectors – with a distinct emphasis on industry – during the era of import-substitution industrialisation. Using the debate between “balanced vs. unbalanced growth” theories as prompting guide, the paper challenges conventional wisdom sustaining that the state supported industrialisation by providing ample/subsidised credit to industrialists. The argument in this article is that the relative share of institutionalised credit flowing to manufacturing was significantly lower than hitherto assumed, when the sectoral allocation considers the financial system as a whole. In fact, it is argued that industrialists were the losers in a financial system in which key players – the Central Bank (CB) – represented competing interests. This proposition is substantiated with a combination of newly constructed datasets integrating credit series for public and private banks, as well as data discriminating the sectoral allocation of resources originating in the CB.******Este documento examina la estructura y las dinámicas de los flujos de crédito institucionalizado entre sectores económicos —con particular énfasis en el industrial— durante la supuesta era de Industrialización por Sustitución de Importaciones. Utilizando como guía el debate entre las teorías del «crecimiento equilibrado y desequilibrado», el documento desafía la sabiduría convencional que sostiene que el Estado respaldó con crédito amplio/subsidiado a los industriales. El argumento asevera que la parte relativa del crédito institucionalizado que fluyó al sector manufacturero fue significativamente menor que al hasta ahora asumido cuando la asignación de todo el sistema financiero es tenida en cuenta. De hecho, se argumenta que los industriales fueron los perdedores en un sistema financiero en el que jugadores clave —como el Banco Central— representaban intereses de la competencia. Esta proposición se sustenta con una combinación de datos nuevos construidos para el crédito público y privado consolidado, así como de datos discriminados sobre la asignación de recursos originados en el Banco Central.

Suggested Citation

  • Carlos Andrés Brando, 2016. "Winners and losers in the allocation of credit during the era of import-substitution industrialisation in Colombia, 1940–1967," Revista ESPE - Ensayos Sobre Política Económica, Banco de la República, vol. 34(79), pages 21-39, April.
  • Handle: RePEc:col:000107:014430
    DOI: 10.1016/j.espe.2015.11.002
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    Keywords

    Industrialización; Asignación crediticia; Intervención estatal;
    All these keywords.

    JEL classification:

    • N2 - Economic History - - Financial Markets and Institutions
    • N6 - Economic History - - Manufacturing and Construction
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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