The Ambivalent consequences of “modernization”. Changes in Property Rights and Wealth distribution in Buenos Aires, 1839-1914

DJENDEREDJIAN, JULIO / SANTILLI, DANIEL

Stellenbosch

Congreso; XVIth World Economic History Congress; 2012

International Economic History Association

From 1839 to 1914, rural areas of Buenos Aires experienced significant changes. They included the transformation of old rights on land, and the settling up of new or “modern” property rights, granted by specific government offices, a process which reached its peak by 1881. Through a sample case, this paper is trying to evaluate the impact of these changes in land prices (which in the period 1854-1881 rise at a pace often double than other production factors), and how that rise affected wealth distribution in the following years. The paper shows that the rise in inequality levels was a consequence of a concentrated land pattern, which, in turn, was a result of the previous years’ development of “modern” property rights. Despite fast rises in land value, those new rights, in fact, consolidated a structure of land tenure suitable for extensive cattle ranching, roughly fitting the economy of former times. But, in the years that followed 1881, with new property rights in full force, rural activities shifted from extensive cattle production to sheep farming and then to cash crops, allowing significant increases in labour and capital investment per hectare. In those years, despite net increases in the proportion of landowners on total population, inequality did not substantially fall, because some landholdings have not been subdivided. That situation was possibly because high land value, already reached in 1881, allowed them to capture strong capital investment to transform these properties to large scale agricultural enterprises. So the settling up of “modern” property rights, at least to some extent, stiffened access to land in the years 1881-1914, not allowing substantial decreases in inequality between owners, despite efforts to facilitate subdivision. If conclusions are not to be generalized, in any case they show a new approach to the effects of “modern” property rights in a context of fast rural growth.