The Confidence Gap: How Argentina's Institutional Whiplash Cost It a Century of Prosperity
From the Paris of the South to the Peso Crisis—Why Brazil Built Resilience While Argentina Broke In the early 20th century, Argentina stood among the world's ten wealthiest nations, richer than France and Italy, while Brazil remained a peripheral coffee exporter. A century later, their trajectories have dramatically reversed: Brazil has built a diversified industrial base and stabilized its currency through the landmark Plano Real, while Argentina has become a cautionary tale of "de-development," plagued by chronic inflation and sovereign defaults. This divergence stems not from resource endowments—Argentina possesses fertile land, lithium, and shale gas—but from compounding institutional choices. Brazil embraced developmentalist state intervention focused on production; Argentina prioritized redistributive populism without productivity gains. While Brazil's scale and "self-correcting" institutions enabled steady progress, Argentina's "instituti...