The Impact of Globalization on Argentina and Chile
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The Impact of Globalization on Argentina and Chile

Business Enterprises and Entrepreneurship

Edited by Geoffrey Jones and Andrea Lluch

During the first global economy of the late nineteenth century and early twentieth century, Argentina became one of the richest countries on earth, while Chile was an economic backwater. During the contemporary era of globalization, liberalization and institutional reforms in Chile provided a context in which business grew, while in Argentina, institutional dysfunction made productive business hard to sustain. This book explores the complex relationships between corporate behavior, institutions and economic growth through the contrasting experiences of Argentina and Chile. In nine chapters written by prominent business historians, the work addresses the role of business in these two eras of globalization, examining the impact of multinationals, the formation of business groups, and relations between business and governments. It places the regional experience within the context of the worldwide history of globalization.
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Chapter 4: Multinational enterprises in Argentina: from primary commodity exporter to the new liberal era

Andrés López


Foreign investment has been a crucial factor in the business and economic history of Argentina since the nineteenth century. Between 1880 and 1930, when economic growth was driven by agricultural exports, large foreign capital flows arrived in the country in pursuit of business opportunities in infrastructure (especially railroads), primary export processing (especially meat packing), and products and services associated with domestic market expansion (such as food, beverages, textiles, chemicals and cement). Later, during Argentina’s import substitution industrialization (ISI) period from the late 1950s to the mid-1970s, MNEs played a key role as the country engaged in capital-intensive manufacturing development. Later, during the pro-market reforms of the 1990s, FDI again flowed in massively, shaping the new economic model that unfolded in that period. There were times when foreign capital was viewed as a potentially negative factor for Argentina’s development. Criticisms included their excessive influence in the domestic economy, which allegedly allowed monopolistic practices and blocked domestic technological development. Hence, at various moments governments nationalized foreign-owned companies and/or clashed with foreign investors. In addition, frequent crises and economic and political instability sometimes turned Argentina into an unattractive host economy.

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