Volume 43, Number 168,
January-March 2012
Argentina's Business Leadership and its Role
in Economic Development
Juan E. Santarcángelo and Guido Perrone

Meanwhile the exploitation rate shows an increase from 1993 until 2001, when it shows one of the highest exploitation rates in Argentine history. During the early years of the economy's expansion in the post-Convertibility period, however, the exploitation rate reaches exorbitantly high levels. From 2005 this tendency is reverted, with values 20% higher at the end of this period than shown in the data for 2001, which as mentioned accounts for historically very high levels.

Figure 7. Exploitation Rate and Profit Margin of 500 Companies.
In percentages and index numbers, base 2001= 100
Source: Prepared by the authors on the basis of data supplied by indec in enge.

This shows that despite strong economic recovery and the re-establishment of important rights for workers, which had been lost during the 1990s (new employment legislation and a growing number of collective labor agreements,) the exploitative situation is even more pressing than it was during the worst economic crisis in the country's history.


The new macroeconomic scenario drawn up after the major devaluation of the peso, following the collapse of the Convertibility Regime, set up a structure of relative prices that reversed poor progress in production sectors during the previous decade, and in manufacturing activity in particular . The slump in the real wage after the devaluation permitted rapid recuperation of profit and industrial expansion, given that local production was relatively well protected as a result of the new exchange rate. From then on there is strong growth in the manufacturing sector. The changes that the economy experienced in the post-Convertibility period had an important impact on the structure of the business elite, and especially on the dynamics of the industrial firms involved. This section discusses the progress of the business elite over the course of the previous decade, as well as the changes suffered to its structure. 12

One important point regarding leading manufacturing companies is that they show a high concentration of production and sales, a trend that strengthened at the end of the Convertibility period. Figure 8 shows the effect the devaluation had on the industrial sector. While the one hundred leading companies gained 40% of their Gross Production Value (GPV) 13 from 2000-2001, this figure rose rapidly to 60% after the devaluation. The progress of sales in leading companies is evidence of the business elite's weight in total production. This progress implies that the expansion of a good part of the manufacturing sector, during a period of strong economic growth, is due to the dynamism of the companies that comprise the industrial elite.

12 It is important to clarify that the information relating to industrial leadership is prepared by the authors in the field of Political Economics at the National University of General Sarmiento on the basis of data supplied in the journals Mercado, Prensa Económica and company balance sheets. As previously mentioned, this comprises the one hundred companies in the sector with the highest sales.

13 By Gross Production Value (GPV) of units we mean the income accrued in the calendar year from the following: sales of goods produced, industrial works, repair of machinery and equipment that belongs to third parties, gross margin generated through commercial activity, commissions for intermediation of goods and services of third parties, loan of services and generation and sale of electricity.

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PROBLEMAS DEL DESARROLLO. REVISTA LATINOAMERICANA DE ECONOMÍA, Volume 49, Number 194 July-September 2018 is a quarterly publication by the Universidad Nacional Autónoma de México, Ciudad Universitaria, Coyoacán, CP 04510, México, D.F. by Instituto de Investigaciones Económicas, Circuito Mario de la Cueva, Ciudad Universitaria, Coyoacán,
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