The Economic History of Latin America since Independence

LACS CH2: These flashcards cover key vocabulary and concepts from the lecture notes on the economic history of Latin America post-independence.

Independence

The state of being free from external control; in this context, the period when Latin America gained sovereignty from Spain and Portugal.

Colonial Economy

An economic system where the colonies were dependent on the mother country's trade and production policies.

Mercantilism

An economic doctrine that emphasizes the role of the state in managing the economy, particularly through accumulating wealth in the form of gold and silver.

Iberian Peninsula

The region in Southwestern Europe that includes Spain and Portugal.

Dynamic Movement

A term referring to an active and changing set of circumstances; in this context, the evolving independence movements in Latin America.

Gran Colombia

A short-lived republic established in the early 19th century that included Colombia, Venezuela, Ecuador, and Panama.

Hacienda

A large estate or plantation in Spanish America, often associated with the production of agricultural goods.

Debt Peonage

A labor system where workers are bound in servitude until debts are paid off, often leading to a cycle of indebtedness.

Creolos

People of European descent born in the colonies, often playing a significant role in independence movements.

Pombaline Reforms

A series of economic and administrative reforms enacted in Portugal during the reign of the Marquis of Pombal, aimed at modernizing and revitalizing the economy.

Free Trade

An economic policy of allowing trades between countries without government restrictions or tariffs.

Civil War

A conflict between groups within the same country over issues such as politics or governance, which was common in many Latin American post-independence countries.

Export Sector

The part of a country's economy that is involved in the production and selling of goods to other countries.

Taxation

The system of raising money for government aims, typically through the charging of fees on income, sales, or property.

Tropical Commodities

Agricultural products that thrive in tropical climates, such as sugar and coffee, which were significant exports for many Latin American countries.

Bourbon Reforms

Economic and administrative changes implemented by the Bourbon dynasty to strengthen the Spanish Empire in its American colonies.

Market Share

The portion of a market controlled by a particular company or product, significant in understanding trade dynamics.

Guano

Fertilizer made from the accumulated excrement of seabirds, which became a key export for Peru in the mid-19th century.

Capital Flight

The large-scale exit of financial assets from a nation due to political or economic instability.

Indigenous Peoples

The original inhabitants of a region, often subjected to various forms of discrimination and exploitation after colonization.

Economic Rent

The difference between what a resource could earn in its next best use and what it currently earns.

Cacao

A key agricultural product used to produce chocolate, significant as an export from some Latin American countries.

Banda Oriental

An area in South America, now known as Uruguay, that was the subject of territorial disputes between Argentina and Brazil.

Territorial Disputes

Conflicts over the boundaries and ownership of land between neighboring countries or regions.

Political Instability

Frequent changes in government and political structures, often leading to unrest and civil war.

Infrastructure Development

Improvements made in the facilities and systems necessary for economic activity, such as transportation and utilities.

Crisis of Governance

A period when governments fail to provide stability or meet the needs of their populations.

Labor Market

The supply and demand for labor in which employers seek to recruit workers, and workers seek jobs.

Foreign Investment

Investment by individuals or entities in assets or companies of another country, often bringing both capital and expertise.

Commodity Lottery

A term used to describe the chance economic conditions that may favor certain commodities, impacting their export success.

Debt Default

The failure to meet the legal obligations or conditions of a loan.

Separation of Powers

A model for governance where the responsibilities of government are divided into different branches to prevent abuse of power.

Urbanization

The process of people moving from rural areas to cities, resulting in the growth of urban areas.

What was the general economic condition of Latin America during the wars of independence?

Severe disruption of trade and declining living standards

How did the Napoleonic Wars affect Latin America’s economy?

Disrupted trade, opened markets to British goods, and weakened Spanish control

Which major events contributed to the rise of independence movements in Latin America?

Napoleon’s invasion of Spain in 1808 and exile of Portuguese royal family to Brazil

What were some immediate political outcomes after independence?

Formation of new republics, border disputes, and civil wars (e.g., Gran Colombia, Central America).

Why were boundary disputes so common after independence?

Colonial borders were loosely defined and often ran through sparsely populated areas, making new frontiers unclear.

What role did foreign powers play in Latin America’s early independence period?

They exploited weak states, acquiring land and influence (e.g., Belize, Guyana, and U.S. expansion into Mexican territory.)

What were the main internal conflicts in new Latin American nations?

Civil wars over government structure, church–state relations, and the retention of colonial institutions.

What central dilemma did new governments face after independence?

Whether to maintain colonial institutions or create entirely new political and economic systems.

What economic system did Latin American republics inherit?

Export-oriented colonial economies dependent on external markets.

What was a key challenge for post-independence economies?

Reconstructing trade and fiscal systems after the collapse of colonial mercantilism and the loss of Spanish subsidies.

Why was fiscal instability a persistent issue?

The colonial tax system collapsed and wars left nations in debt.

What was the “colonial legacy” in economic terms?

Dependence on exports, inequality, and elite dominance

How did population and geography shape early republics?

Sparse populations and vast territories made governance difficult

What were common features among the new Latin American states?

Political fragmentation, economic dependence, inequality

What long-term challenge did Latin America face after independence?

Building stable institutions and diversifying economies while overcoming the structural legacies of colonial rule.