Market Circuits and Enclave Extraction
The Villager (el Aldeano) was an anonymous author who gave us some of the most important socioeconomic descriptions of life in early post-independence Bolivia. He was, however, far from being the provincial he claimed to be, explicitly quoting Enlightenment authors like Benjamin Constant, Jeremy Bentham, Gaetano Filangieri, Montesquieu, and Jean-Baptiste Say. The Villager questioned whether Bolivia was really independent and free, painting a portrait of “misery” five years after independence: the mining industry was in ruins and the manufacturing and agricultural sectors in decline. The fundamental dilemma that he analyzed was why a country with so much natural wealth could suffer so much poverty.
This early Bolivian economist attributed the “epidemic of the Nation” to free trade and foreign trade. He maintained that the abundance of imported goods meant a decrease in the demand for goods produced in the country, leading to unemployment and the breakdown of domestic trade. This resulted in a decrease in the money supply as well, since foreign commodities had to be paid for with silver.
In the face of these “dire consequences” of economic liberalism, The Villager proposed protectionist fiscal and tax policies, recommending a series of regulations against imported goods and increased tariffs. In addition, he argued for reform of a moral order such that citizens—and especially women—might renounce the vice of consumption of imported luxury goods.