North America vs South America

[HenryNisental]

There are four main reasons for this. Also, to be clear, the meaningful contrast is between Anglo-America and Latin America, since Mexico and arguably Central America are part of North America, but they had histories similar to those of the South American countries.

First, as Robert Chandler correctly points out, Spain and Portugal bestowed feudalistic political economies on their colonies, with a basically parasitic rentier class living off of the labor of peasants. (In some of those colonies, strictly hierarchical societies—such as that of the Aztec—may have preceded the arrival of Europeans.) The colonial and postcolonial rentier class made little investment to boost the productivity of the local economies and blocked the development of liberal economies in their countries. By contrast, in its North American colonies, England settled entrepreneurial, property-owning farmers and merchants, who brought with them liberal political and economic orientations (in the European sense of the word liberal). This was true more of the northern colonies of North America, since the southern colonies were based economically primarily on slave labor. In the English-speaking colonies, especially those in the north, the propertied white population invested heavily in economic development and fostered systems based on democratic elections (though participation was largely restricted until the 20th century to white males).
As a result of both this entrepreneurial orientation and the continuing economic and cultural connection to Britain, English-speaking North America was the first region of the Western Hemisphere to industrialize. Partly as a consequence, it developed a powerful financial sector, centered in New York.

Second, the Latin American countries, aside from parts of the Southern Cone of South America (Chile, Argentina, and Uruguay), exist in climate zones in which European patterns of agriculture and livestock rearing were not possible. That meant that the agricultural innovations that advanced the economies of Europe and North America and encouraged the development of local commodity markets in the early modern period were not applicable in most of Latin America. Instead, they were largely restricted to cash crops for export and crops for local consumption that were less easy to transport and therefore market.

Third, the Latin American countries were separated by a number of physical barriers, both between countries and internally, in many cases. Steep mountains and tropical forests made land transport difficult to impossible. They led to the fragmentation of the Spanish New World empire into many, mostly relatively small countries and hindered the development of trade both between and within countries. This, in turn, hindered the development of internal markets and economies and focused trade on coastal ports aimed at the wealthy European and North American markets, which prolonged the economic dependence of Latin America on those markets for income and capital.

In the United States, the Appalachian Mountains are low-lying and crisscrossed by valleys, such that they did not offer a serious barrier to trade. In Canada and the northern United States, the Great Lakes facilitated the development of the interior. By the time US and Canadian expansion had reach the more serious barriers of the western mountain chains, they had already developed robust economies and could both tap deep capital markets and make use of railway technology to overcome those geographic barriers.

Fourth, the early industrialization and economic development of the United States (and, to a lesser degree, Canada) allowed it to take a dominant position militarily and, increasingly, economically in the Western Hemisphere. Increasingly, Latin American producers were dependent on US markets for their products and for the capital they needed to maintain production. Repeatedly, from the 19th century on, the United States intervened militarily in Latin America to impose governments supportive of US economic interests. Often, military intervention was not necessary. Latin American elites recognized their economic dependence on US markets and enacted policies favorable to US interests—policies often unfavorable to the development of economic autonomy and the improvement of living standards for the less-advantaged people of their countries.

 

[camel]

Is this from a book or did you write this? It's pretty interesting. I've been interested in knowing why North America and South America turned out so different. This sheds some light on it.

I'm still on a quest for a book like Democracy in America by Alexis de Tocqueville, but that covers Latin America rather than the USA.

 

[Pierre Smith]

^ Pages 3-20 of this paper provide a pretty interesting starting point into an institutionalist analysis of Argentina's history in the 20th century. Implicit in this and other approaches is the relative unimportance of the vestiges Spanish institutions to explain modern Argentina compared with other Latin American countries. And implicit in that view is an understanding, endorsed by OP and pretty much everyone else, that the various Latin American countries developed along quite different trajectories as industrialization hit.

If you're interested in how Argentina was built, the most insightful overview in English I was able to find is called The Crisis of Argentine Capitalism by Paul H. Lewis. It's a popular and not scholarly work, so can be picked up and read on an airplane or in your study or whatever. Broadly, according to Lewis' history, a large number of European immigrants settled the Pampas and the rest of the country with a mind to exporting, succeeded spectacularly, then along the way created industry, Buenos Aires, and modern Argentina. However, a crucial flaw that kept coming back was the closed nature of the access to capital - public ownership (ie. shares on a public market) as a financing innovation developed later than in Europe, and it came in fits and starts as the economy was buffeted by various events (wars, disputes) that affected various companies' fortunes. And, of course, all of this was greatly taken off course (if you're a liberal) by the decidedly illiberal dictatorships that took over starting in the 1930s. The issue of capital access comes up again and again in this Argentine history, and I guess in a lot of ways it's one of the central issues today.

 

[HenryNisental]

The author is Robert Chandler

 

[chris]

There are four main reasons for this. Also, to be clear, the meaningful contrast is between Anglo-America and Latin America, since Mexico and arguably Central America are part of North America, but they had histories similar to those of the South American countries.

First, as Robert Chandler correctly points out, Spain and Portugal bestowed feudalistic political economies on their colonies, with a basically parasitic rentier class living off of the labor of peasants. (In some of those colonies, strictly hierarchical societies—such as that of the Aztec—may have preceded the arrival of Europeans.) The colonial and postcolonial rentier class made little investment to boost the productivity of the local economies and blocked the development of liberal economies in their countries. By contrast, in its North American colonies, England settled entrepreneurial, property-owning farmers and merchants, who brought with them liberal political and economic orientations (in the European sense of the word liberal). This was true more of the northern colonies of North America, since the southern colonies were based economically primarily on slave labor. In the English-speaking colonies, especially those in the north, the propertied white population invested heavily in economic development and fostered systems based on democratic elections (though participation was largely restricted until the 20th century to white males).
As a result of both this entrepreneurial orientation and the continuing economic and cultural connection to Britain, English-speaking North America was the first region of the Western Hemisphere to industrialize. Partly as a consequence, it developed a powerful financial sector, centered in New York.

Second, the Latin American countries, aside from parts of the Southern Cone of South America (Chile, Argentina, and Uruguay), exist in climate zones in which European patterns of agriculture and livestock rearing were not possible. That meant that the agricultural innovations that advanced the economies of Europe and North America and encouraged the development of local commodity markets in the early modern period were not applicable in most of Latin America. Instead, they were largely restricted to cash crops for export and crops for local consumption that were less easy to transport and therefore market.

Third, the Latin American countries were separated by a number of physical barriers, both between countries and internally, in many cases. Steep mountains and tropical forests made land transport difficult to impossible. They led to the fragmentation of the Spanish New World empire into many, mostly relatively small countries and hindered the development of trade both between and within countries. This, in turn, hindered the development of internal markets and economies and focused trade on coastal ports aimed at the wealthy European and North American markets, which prolonged the economic dependence of Latin America on those markets for income and capital.

In the United States, the Appalachian Mountains are low-lying and crisscrossed by valleys, such that they did not offer a serious barrier to trade. In Canada and the northern United States, the Great Lakes facilitated the development of the interior. By the time US and Canadian expansion had reach the more serious barriers of the western mountain chains, they had already developed robust economies and could both tap deep capital markets and make use of railway technology to overcome those geographic barriers.

Fourth, the early industrialization and economic development of the United States (and, to a lesser degree, Canada) allowed it to take a dominant position militarily and, increasingly, economically in the Western Hemisphere. Increasingly, Latin American producers were dependent on US markets for their products and for the capital they needed to maintain production. Repeatedly, from the 19th century on, the United States intervened militarily in Latin America to impose governments supportive of US economic interests. Often, military intervention was not necessary. Latin American elites recognized their economic dependence on US markets and enacted policies favorable to US interests—policies often unfavorable to the development of economic autonomy and the improvement of living standards for the less-advantaged people of their countries.

Actually New York did not become the financial center until around the 1830s. Philadelphia had been the center of banking and finance and the largest city of the British North American colonies in the 1700s.

 

[Pensador]

The interesting thing my Harvard Educated doctor in URU told me once. A major difference between USA North Americans and South Americans is that both can be well-educated but one memorizes for the most part the other puts their eduction in application and action. This is not always the case but is one of the issues he said saw as major difference in these two cultures. Interesting and I would agree with him in many ways.

 

[FallenAngel]

There are lots of reasons for differences in North / South america:

• The inability to create commodity based economy due to agricultural differencse was actually a benefit to South America. It should have turned south america into an industrial powerhouse. Due to the dutch dilema it is non-commodity economies that tend to industrialize. So, that is not a reason for why it did not industrialize.
• The geography of South America is more difficult. The river systems are not as conducive to trade. It is further away from established trading partners. This is likely the biggest reason for south america's lack of development.
• The average IQ of north / south america is far different. Much of south america has an IQ in the 80s/90s. This is not an argument of why there is an IQ difference (nutrition, culture, genetic) simply an observation of the fact. It is hard to create an advanced society when average IQs are too low.

 

[camberiu]

The average IQ of north / south america is far different. Much of south america has an IQ in the 80s/90s. This is not an argument of why there is an IQ difference (nutrition, culture, genetic) simply an observation of the fact. It is hard to create an advanced society when average IQs are too low.

Portugal and Russia have a higher average IQ than Israel. Which country is doing better?
Vietnam has a higher average IQ than Chile, Argentina and Greece. Where would you rather live?
Taiwan has higher average IQ than pretty much any other country expect Singapore and Hong Kong. That "superior IQ" certainty has not delivered superior economic development when compared to Germany, the UK Switzerland or Canada. Also, the top 3 countries in terms of average IQ are all ethnic Chinese (Singapore,Hong Kong and Taiwan). If went back 100 years I told the white supremacists who developed the IQ tests that eventually their metrics would be dominated by "dumb, smely Chinese" I think you would be met with significant skepticism.
I think my point is: IQ is bullshit

 

[FallenAngel]

Also, the top 3 countries in terms of average IQ are all ethnic Chinese (Singapore,Hong Kong and Taiwan) If went back 100 years I told the white supremacists who developed the IQ tests that eventually their metrics would be dominated by "dumb, smely Chinese" I think you would be met with significant skepticism.

You seem to be inputting a lot of your own baggage into my statements. I did not even mention race in my post yet you seem to be on a racial tirade. I am really sick of racists like you where everything is viewed through the lens of skin color. It is disgusting and you should be ashamed.

Taiwan, Singapore, and Hong Kong all have very high IQs. Their superior IQ has delivered a very complex society that is prosperous and low-crime. Despite having poor natural resources they have excelled against many competitors who were blessed with better natural resources and position. No one is saying that IQ is the only factor. In my original post I even stated I believed geography is the largest factor in SA. However, it is a factor. A low-IQ population certainly limits the potential range of a society. However, due to other factors there is large variation in what potential the society will reach.

 

[camberiu]

Taiwan, Singapore, and Hong Kong all have very high IQs. Their superior IQ has delivered a very complex society that is prosperous and low-crime.

That has only been true over the past 40 years or so. Over the past 400+ years that has certainly not been the case in either Taiwan, Hong Kong or Singapore (or mainland China). Why didn't their "superior IQ" provide them with a rich, prosperous and low crime society in the last 400 years? Or was their IQ lower in the past 400 years and then suddenly jumped to triple digits in the last 40? Or maybe, just maybe, IQ does not have jack shit to do with anything.
It seems that you like to build straw men instead of addressing any challenge to your claims with factual data.