A new estimate of Argentina’s industrial output suggests a less optimistic view of the country’s ‘golden age’.
In a previous post I discussed a working paper in which I criticised Roberto Cortés Conde’s estimates of Argentina’s industrial output from 1875 to 1913. In a new version of that working paper I have taken the plunge by producing my own index for this period in a new version of that working paper. It suggests a considerably lower rate of industrial growth than is found in the standard optimistic account of the country’s ‘golden age’.
Argentina’s economic history provides yet another example of the problem of Mickey Mouse numbers.
When a prominent economic historian provides a new estimate of something, it is likely that the estimate will be taken at face value. Other economic historians will cite it, so it becomes reified, until it is treated as fact, even when it is little more than fancy. John Coatsworth’s estimate of Argentina’s GDP in 1800 provides an example of this.
An estimate of Argentine industrial output from the 1870s to 1913 illustrates a problem with the New Economic History.
The ‘New Economic History’ has sought to transform the study of history by applying econometric techniques to the past. As such, it has greatly increased the demand for historical statistics. The problem has been the supply, as there simply are not enough good quality data to apply econometric techniques to historical issues.
My new paper details the problems of measuring the periphery’s terms of trade in the nineteenth century.
In a previous post I outlined some of the problems encountered by Jeffrey Williamson when he attempted to measure the periphery’s terms of trade in the nineteenth century. I have now uploaded a new ‘Technical Paper’ titled ‘The Periphery’s Terms of Trade in the Nineteenth Century: A Methodological Problem Revisited’, which is a considerably revised version of Chapter 2 of my PhD dissertation. In it I have detailed the methodological issue and why it affects Williamson’s analysis.
Accepting Argentina’s GDP statistics in the new version of the Penn World Table would require a major rewrite of its post-war history.
Last year the eighth edition of the Penn World Table (PWT) was released to considerable fanfare – indeed, one commentator described it as ‘a special day for all researchers and practitioners of economics‘. Yet its series for Argentina raises more questions than it answers.
Jeffrey Williamson’s estimates of the periphery’s terms of trade in the long nineteenth century are misleading.
Jeffrey Williamson‘s (2011) book Trade and Poverty: When the Third World Fell Behind is one of the most interesting attempts to explain the ‘great divergence’ between rich and poor countries. It is a shame, then, that it is marred by his use of Mickey Mouse numbers.
Argentina’s apparent decline during the twentieth century is more likely an illusion created by faulty GDP statistics.
Recently the Economist published a front-page feature on ‘The Tragedy of Argentina: A Century of Decline‘. By summarising the current scholarship on the ‘Argentine paradox’, the article demonstrates why the study of the country’s history remains so necessary.
D.C.M. Platt’s critique of historians’ use of ‘Mickey Mouse numbers’ remains as relevant as ever today.
I never met my grandsupervisor (the PhD supervisor of my PhD supervisor), but I have enjoyed reading his rants. One in particular made a major impression upon me.