Volume 44, Number 175,
October-December 2013
The Takeover of Soy and Dutch Disease in Argentina:
An Agricultural Curse?
Alicia Puyana and Agostina Constantino

Beyond the previous discussion, there would also seem to be a relationship between currency appreciation and the growth of soy exports. Figure 4 shows accelerated growth in these exports starting in 1999, the moment when soy prices began to rise. The annual average growth rate went from 9.7% before 1999 to 15.5% starting in that year.

Figure 4. Average Annual Growth Rate of Soy Exports from Argentina

Source: Faostat.

As anticipated by the theory, both revenue for currency due to increased soy exports as well as the increase in the relative prices of non-tradable goods will further accelerate growth in relative prices and decelerate growth in the sectors of the rest of traditional non-tradable goods (such as industrial origin manufactures and other agricultural products that are not in boom), both due to the resource movement effect (redirecting of capital, work and in this case, land, from the rest of the sectors to the sector in boom) as well as the spending effect, both public and private (due to the appreciation of the real exchange rate.

As shown in Figure 5, the services and construction sectors (both non-tradable) have seen accelerated growth starting at the time when the price of soy began to rise. The services sector went from average growth of 3.5% before the increase in soy prices (1991-1999) to an annual average of 4.3% starting that year (1999-2011). The case is even strong for the construction sector, which went from growth of 3.2% to almost double that annual growth rate after 1999, reaching 6% on average.

Figure 5. Average Annual Growth Rate of Non-Tradable Sectors: Services and Construction

Source: Prepared by the authors using indec data. Data from 2000 to 2011 are preliminary estimates.

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PROBLEMAS DEL DESARROLLO. REVISTA LATINOAMERICANA DE ECONOMÍA, Volume 49, Number 195 October-December 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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