INTRODUCTION

The development of economic institutions in Argentina was driven both by factors particular to the conditions of the region and to the structure of the viceroyalty from which Argentina grew and by economic pressures of a larger scale. For this reason, our chapter contains two parts comprising Sections 11.2 to 11.8. The first is a detailed discussion of the conflicts and pressures inherent in the economic structures and institutions of the colonial administration and of the attempts by the new nation, Argentina, to mold these institutions into, or replace them by, something more consistent with the emerging realities. The sources of these new institutions are of primary interest. The second, consisting of Section 11.9, presents a formalized dynamic economic/political model that is intended to highlight some of the claims of the first part. In particular, the importance of distance and the ability of the government to collect and utilize taxes and to deliver services are shown to be sufficient to generate outcomes that mimic the main flow of much of Argentina's economic history.

THE IMPERIAL ADMINISTRATION (1620–1776)

The Spanish brought to America the institutions they knew from Castilla, which they had developed over the centuries of the Reconquest. In the vast New World, these institutions changed as a result of a variety of circumstances, important among which were those that resulted from the nature of the resources that the Spanish encountered.