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Taxation and Agricultural Stagnation

In: A Political Economy of Uruguay since 1870

Author

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  • M. H. J. Finch

    (University of Liverpool)

Abstract

One of the most enduring general interpretations of Uruguay’s problems is that the economy has suffered from the effects of excessive and misguided government.1 The analysis to support such a view has frequently been unsophisticated, even reducible to the propositions that batllista Uruguay was socialist, and that socialism does not work. At a more serious level is the ‘misplaced modernity’ interpretation, which argues that the batllista edifice of state intervention in economic and social affairs was built on an economic foundation which was incapable of supporting the burden. It might thus be said that the freedom of the political system to develop urban-based redistributive policies penalised the rural sector, diverting away from it resources which were required for investment in a modern and dynamic agricultural economy. The most systematic presentation of such a view was published in 1930: Riqueza y Pobreza del Uruguay.2 This work tackled the central problem of Uruguayan underdevelopment, the stagnation and technical backwardness of the rural sector, and its anti-batllista view of the Uruguayan process threw down a challenge to those holding opposite or incompatible ideas which seems never to have been taken up. The second part of this chapter presents a critique of Riqueza y Pobreza. It is preceded by a general analysis of Batlle’s fiscal policy and the implications of it for the landowning class.

Suggested Citation

  • M. H. J. Finch, 1981. "Taxation and Agricultural Stagnation," Palgrave Macmillan Books, in: A Political Economy of Uruguay since 1870, chapter 4, pages 91-122, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-1-349-16623-7_4
    DOI: 10.1007/978-1-349-16623-7_4
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