Big Push or Big Grab? Railways, Government Activism and Export Growth in Latin America, 1865-1913
AbstractRailways were one of the main engines of the Latin American trade boom before 1914. Railway construction often required financial support from local governments, which depended on their fiscal capacity. But since the main government revenues were trade-related, this generated a two-way feedback between government revenues and railways with a potential for multiple equilibria. The empirical tests in this paper support the hypothesis of a positive two-way relationship. The main implication of our analysis is that the build-up of state capacity was a necessary condition for railway expansion and, given the importance of the export sector in these economies, for economic growth and divergence in the region.
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Bibliographic InfoPaper provided by Banque de France in its series Working papers with number 447.
Length: 51 pages
Date of creation: 2013
Date of revision:
Railways; Latin America; Export growth; Government revenues.;
Find related papers by JEL classification:
- H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
- N46 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Latin America; Caribbean
- N76 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Latin America; Caribbean
- O38 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Government Policy
- O54 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-10-11 (All new papers)
- NEP-HIS-2013-10-11 (Business, Economic & Financial History)
- NEP-PBE-2013-10-11 (Public Economics)
- NEP-TRE-2013-10-11 (Transport Economics)
- NEP-URE-2013-10-11 (Urban & Real Estate Economics)
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