In 1942, Adolfo Dorfman published his classic study of Argentine industrial growth, Historia de la industria argentina. Now some 40 years later, he has completed the sequel, a long and detailed analysis of industrialization between 1930 and 1980. Like the first book, this should become a classic.
Dorfman set out to explain the apparent collapse of Argentina’s heavy industrial sector during the 1970s. In common with economists in other developing countries, he wanted to know why industries that seemingly came of age in the 1950s did not mature in subsequent decades. After conducting a meticulous survey of a mass of statistical and census data, he concluded that domestic factors played an important role in inhibiting the rise of a healthy industrial complex in Argentina.
In brief, Dorfman attributes much of the slowdown in industrial growth during the 1970s to conditions that existed before World War II. In particular, although import substitution policies introduced between the 1930s and 1950s shifted Argentines away from a predominantly agricultural and pastoral economy, they failed to create a concentrated national industrial complex on a vertically integrated basis. Rather, the bulk of Argentina’s manufacturing enterprises remained small and regional or local in nature, despite their relative efficiency. Most produced foodstuffs, clothing, cosmetics, construction materials, and household items. By the 1950s, a few manufacturers began to meet the Argentine demands for paper, metal, and pharmaceutical products. But at no time during this period did Argentines develop important petrochemical or heavy manufacturing complexes on a national scale. Indeed, they fell well behind Mexico and Brazil in the production of export items.
In 1939, Argentina ranked as the indisputable industrial leader of Latin America. But after World War II, a combination of political, demographic, and economic factors complicated the process of growth. After 1946, Argentina’s population grew slowly. This fact, along with the relatively underdeveloped nature of its mining resources, served as a brake on the development of a nationally integrated industrial complex. Added to this, a lack of capital and technology further hampered Argentine efforts to expand their industrial sector, and led to what Dorfman calls the denationalization of many industries during the 1960s and 1970s. The absence of vibrant and imaginative industrial leadership rounded out the basic causes for the dismal picture.
Dorfman also attacked politicians for their inability to deal with questions related to industrial growth in nonpartisan terms. From 1950 onward, political factions overlooked the need to establish national plans aimed specifically at supporting the development of heavy industries. Nor does Dorfman appear sanguine about the future in this regard, although he believes that politicians can find a viable solution if they adopt a comprehensive plan aimed at altering the past patterns.
The book, though sometimes cumbersome and difficult to read because of its length and its detailed analysis, nevertheless provides one of the most lucid accounts of Argentine industrial performance during the past 50 years. Argentines are not as wealthy as they like to think they are and now Dorfman has made this basic fact perfectly clear. He can only hope that his book will stimulate a strong debate about reality, not fantasy.
