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TRANSPORT TECHNOLOGY AND ECONOMIC EXPANSION: THE GROWTH CONTRIBUTION OF RAILWAYS IN LATIN AMERICA BEFORE 1914*

  • Alfonso Herranz-Loncán (a1)
Abstract

This paper measures the direct contribution of railways to economic growth before 1914 in four Latin American economies with large railway systems (Argentina, Brazil, Mexico and Uruguay) using growth accounting techniques. The outcomes of the analysis indicate that the growth contribution of railways in Uruguay was very low. By contrast, in Argentina and Mexico railways provided huge benefits, amounting to 20-25% of income per capita growth before 1914. Finally, in Brazil, the growth contribution of railways was even higher, although this was largely a consequence of the stagnation of the Brazilian economy. These results provide an example of a technology whose growth contribution was much higher in some peripheral economies than in the core countries where it was developed.

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This research has been financed by the Spanish Ministry of Science and Innovation project ECO2012-39169-C03-03. I thank Sandra Kuntz, Paolo Riguzzi and the participants at the I Encuentro de la AEHE, the XXVI Jornadas of the Banco Central del Uruguay, the 2011 Carlos III FRESH Meeting and the 9th EHES Conference for their comments and help. They are not responsible for any mistakes in the paper.

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Revista de Historia Economica - Journal of Iberian and Latin American Economic History
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