Volume 44, Number 173,
April-June 2013
Towards a New Development Model?
From a Regulatory Perspective. Argentina 2003-2010
Ignacio de Angelis, Mariana Calvento and Mariano Roark
Institutional Forms: Monetary Regime ( ...continuation )

A devaluated exchange rate has a direct influence on the economic profile of international insertion and the physiognomy of the domestic productive structure. The end of the convertibility regime is the main feature of the new configuration of a monetary regime that, together with other factors that we will point out later on, allowed for the creation of a new pattern of economic growth and ushered in the reconfiguration of the productive forces of social relations.

The devaluation produced an immediate and profound impact, not only for the exchange rate but also for the domestic price structure in general, negatively affecting the real income of salaried workers. At the same time, in 2002, the Argentinean economy reached the low point of its recession with gdp falling by 10%. In this context of crisis, social mobilization and repression finally forced then-President Eduardo Duhalde to move up the elections that would bring Néstor Kirchner to the presidency in 2003.

From there, the new pattern of growth initiated on the basis of a competitive exchange rate brought about the success of a new economic cycle in Argentina in a regional context of prosperity and growth. In this regional framework, Argentina stands out as the country whose economy had the highest cumulative growth rate between 2002 and 2010, at above 7%.

There are a series of circumstantial features in Latin America that benefited both Argentina and other countries in the region, including the rise in international oil prices and the demand for products exported from the zone, as well as the successful emergence from debt in Argentina, Venezuela, Brazil, Mexico and Uruguay, nations that were able to resolve their debts to the imf and implement an advance payment policy for repayment of their external debt.

The high growth seen in the Argentinean economy can be explained as a function of the internal changes made in the framework of transition to a new development model. While the majority of countries in the region did not significantly modify their growth patterns with respect to the 1990s (cenda, 2007: 10-14), Argentina underwent great change beginning with the devaluation and interpellation of the accumulation regime based on the financial valuation in effect throughout the last years of the twentieth century (Azpiazu and Schorr, 2010: 36).

Among these changes, we should first highlight the establishment of a real competitive exchange rate and continual state intervention to contain currency appreciation in a surplus context. 1 Secondly, the dynamic reindustrialization process and the reactivation of the productive capacity that would become the new motor of economic growth was key. Finally, as a result of the growth and economic reactivation, together with a set of government measures for social distribution, the internal market was strengthened.

In this way, the end of the convertibility regime is one of the key determinants of the new growth pattern, by reorganizing productive relations and reviving the capital accumulation process. In summary, the end of a fixed currency regime represented a break with the former financial valuation regime and the start of a transition towards a new accumulation regime.

Institutional Forms: The Market

The next fundamental institutional form involves the features of the market and relations among the units and sectors that comprise it. The market may acquire diverse manifestations, with the extreme being highly competitive and monopolistic relations. The validity of these relations may be defined by the market itself or beforehand by general social rules. There is an entire universe of relations that exist within the market and that can be defined to analyze the regulation mode.

The main feature of this time period is strong State regulation of the market, which tried to correct imbalances and redirect investment and profits from the most dynamic sectors towards those that needed incentives.

The market expansion starting in 2002 has come to be seen as one of the most important times of growth in its history, not only because of the magnitude, but also because it was so sustained, beginning a period of uninterrupted economic growth at an average rate of 7.6% through 2010.2 When analyzing the behavior of this growth as a function of per capita values, it becomes clear that the average values recover to 1990s levels by 2007, and from there the new profile of the economic cycle begins to consolidate.

1 Likewise, a differentiated exchange rate was established for the industrial sector (through a lower level of withholding and the reintegration of exports), as a protective measure and a tool to diversify exports.

2 According to official data, in 2009 the economy maintained its growth rate, although at a rate much lower than during the rest of the time period. However, according to private estimates, the 2009 growth rate was negative (Basualdo, 2011: 124).

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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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