National brands?
Ok. This is a bit of a ramble, my apologies in advance..
So, one day 'my friend' went into the local farmacia and asked for 'lubricante sensual'. Expecting KY to be brought to the counter. He was given the choice of KY or this other product which the clerk said (with much cheerfulness) was the national brand. 'My friend' was encouraged to buy the national brand.
When the occasion arose to use 'said product'...my friend and his girlfriend reported the the quality was not just sub par...but down right awful.
See, there seems to be a patriotic incentive for customers to use -and for sales clerks to sell- the national brand products. Not because they are high value products that are good for the customer, but simply due to the fact that they are made in Argentina. "Buy local", of course is not limited to Argentina, but in my experience it is more intensively put into practice at the national level here than in many other countries. You will find that many goods made in Argentina - whether they be clothes or refrigerators or toilet seats... are of poor quality.
Now, am I suggesting that Argentines are just bad at making stuff? NO. Absolutely not. What I am saying is that there is value in specialization...and that the Argentine manufacturing sector doesn't specialize. -They literally have been given the government mandate to make as many different products as possible in order to substitute for the items that are imported from overseas. Thus reducing the amount of hard currency sent overseas for imported products.
Argentine governments have engaged in this economic strategy referred to in the literature as "import substitution" for the past 70-100 years or so.
The thinking of this strategy is as follows...."we can send our hard currency overseas for the products we want, or we can save our hard currency by encouraging our manufacturing companies to make the same products here". The result is that Argentina doesn't specialize in any specific manufactured products...but instead they make almost all products (that are technologically feasible) for sale in the local economy.
An alternative economic strategy used widely by Asian countries is: "let's specialize in the making a product and make it really good and really cheap, so that the whole world will want to buy it. Governments in Asian countries will even subsidize the development of such products so that they can grow to dominate the global market for that product.
These countries go on offense and sell high quality/low cost goods around the world and earn hard currency. Argentine 'national brand' products typically are not sold abroad due to the fact that the cost/quality factors don't make the products competitive in a global marketplace.
Does Argentina sell products abroad? Of course - wine, beef, and other agricultural products are considered desirable and are sold around the world.
The point is... Argentine government policy has been to encourage Argentine companies to play defense and make goods for the home market. The government simultaneously encourages citizens to buy Argentine products over international products- as a patriotic duty. The result of this is that the Argentine economy doesn't really specialize in manufacturing any high quality products that can compete in the global marketplace. Mostly Argentine manufacturers make a broad range of low quality stuff for Argentines to buy out of patriotic duty.
Over time, trade balances lean against Argentina as Argentines still want to buy those high tech foreign products that cannot made locally and are also willing to spend huge sums of money for rare foreign brand items that are prized for their high quality. The net result is that negative trade flows drain hard currency reserves out of the Argentine economy weakening the peso and the real wages of the Argentine people over time. This causes a slow, almost imperceptible decline in the Argentine economy that has had a huge impact on living standards when you look at the trend over the course of decades.
This government driven economic strategy has, perhaps, been as damaging as anything else Argentine governments have done in the past 100 years. And when you combine the deleterious economic effects of this policy with a strong expectations on the part of the general public for strong government and a first world social welfare system-which are expensive....you get an unsustainable economic reality.
and worst of all... Argentines get stuck using low quality lube...
