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State-owned and multinational enterprises partnership as an import substitution strategy: A narrative ARDL approach to the case of oil contracts in Argentina (1958–1962)

Author

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  • Cruz, Manuel Máximo
  • Gahn, Santiago José
  • Morlin, Guilherme Spinato

Abstract

To avoid balance of payments crises, two Argentine presidents tried to make deals (‘oil contracts’) with multinationals to transfer technology and know-how to YPF, which is a state-owned company in the oil sector. The aim was to substitute imports. The ‘oil nationalism’ doctrine opposed these agreements, arguing that multinational companies threaten national security. In both cases, the story ended in a coup d’état, first in the period 1954/1955 (against President Juan Domingo Perón) and the second in 1962/1963 (against President Arturo Frondizi). Based on a demand-led growth model in small open economies, we show that the process of import substitution led by government agreements with multinational firms can increase national production. Using an original dataset, we corroborate this theoretical result by applying a narrative ARDL approach to the Argentine experience (1958-1962), where a government policy to promote technological transfer from multinational firms to YPF, to substitute imports was in place. We conclude that the oil contracts were successful.

Suggested Citation

  • Cruz, Manuel Máximo & Gahn, Santiago José & Morlin, Guilherme Spinato, 2022. "State-owned and multinational enterprises partnership as an import substitution strategy: A narrative ARDL approach to the case of oil contracts in Argentina (1958–1962)," Structural Change and Economic Dynamics, Elsevier, vol. 63(C), pages 213-223.
    • Handle: RePEc:eee:streco:v:63:y:2022:i:c:p:213-223
    DOI: 10.1016/j.strueco.2022.08.006
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    More about this item

    Keywords

    Argentina; Economic development; Foreign direct investment; MNEs; SOEs; Import substitution policies; Industrial policy; Petroleum sector; Structural change;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • N46 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Latin America; Caribbean
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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