| Abstract: |
The aim of this paper is to analyze the evolution of regional income
disparities in the South American Southern Cone (SASC) in historical
perspective. One of the first results of our analysis is that most of the
regional inequality in this geographic area stems from differences within
countries rather than from disparities across countries. The second result is
that the evolution of regional inequality between the end of the 19th century
and the second third of the 20th century is different in each country: while
Chile shows a higher inequality and a U-shaped evolution (reduction of
inequality and a slight increase in the 1960), Uruguay presents a
monotonically declining inequality and Argentina exhibits a U-shaped evolution
with decreasing disparities until the beginning of the 20th century and
increasing inequality afterwards. When the entire subnational units are
analyzed together, we find a U-shaped curve which started at the end of the
19th century with high levels of inequality, a minimum is found in the 1940s
and another local maximum ended with the collapse of the Import Substitution
Industrialization (ISI) polices in the 1960s-1970s. We also analyze regional
convergence in the long run for the Southern Cone at both national and
regional level. The existence of convergence at a national level depends on
the periods and countries: while Uruguay shows convergence in all the analyzed
sub-periods, the provinces of Argentina only converge during the period of the
first globalization; most of the departments of Chile converge in general but
the presence of outliers induces the rejection of convergence hypothesis
during the first globalization. Convergence at a regional level (including all
the sub-national units from the three countries in the same analysis) is
accepted for the period of the first globalization but rejected for the
central decades of the 20th century. The empirical findings are interpreted as
the result of the combination of the varying potential of the sub-national
units for taking advantage of (i) the forces of agglomeration (inducing high
growth rates in the main cities and, in particular, in the administrative
capitals), (ii) the abundance of natural resources, and (iii) the stimulus
originated in technological change, integration (or dis-integration) to
international markets and public policies for industrialization. |