Argentina's bussiness leadership and its role
in economic development
Juan E. Santarcngelo and Guido Perrone

Figure 4. Prospective Path of VA of 500 Companies, VA total
(same sectors as ENGE in millions of pesos, in current prices)
Source: Prepared by the authors on the basis of data supplied by INDEC.

Figure 4 shows the evolution of value added among business leaders in relation to the performance of the total economy, excluding the agricultural and financial sectors. One factor that can be observed is that business leaders carried substantial weight in terms of value added in the Argentine economy in the 1990s, with an average of around 22% of the total. However, after the devaluation there is a significant rise in the relationship between the GVA of the 500 leading companies and the GVA of the total economy (excluding the agricultural and financial sectors) which exceeds 36% in 2002, later stabilizing and reaching an average value of nearly 33% from 2002 to 2009, with a slight fall from 2008. This trend shows that output concentration in the Argentine economy increased by 50% compared to levels during the Convertibility Regime. This tendency was not gradual but essentially a response to the shock of the 2002 devaluation. This significant increase in the value added generated by leading companies, occurred in parallel to a more inequitable distribution of income generated. This phenomenon can be observed in Figure 5 which shows the performance of value added and the benefit and salaries ratio of value added.

Figure 5. Value Added, Profit and Salary Value Added in the 500 Largest Companies
Source: Prepared by the authors on the basis of data supplied by INDEC in ENGE.