Report

The Monetary and Fiscal History of Argentina, 1960-2017

Abstract: In this chapter, we review the monetary and fiscal history of Argentina for the period 1960?2017, a time during which the country suffered several balance of payments crises, three periods of hyperinflation, two defaults on government debt, and three banking crises. All told, between 1969 and 1991, after several monetary reforms, thirteen zeros had been removed from its currency. We argue that all these events are the symptom of a recurrent problem: Argentina?s unsuccessful attempts to tame the fiscal deficit. An implication of our analysis is that the future economic evolution of Argentina depends greatly on its ability to develop institutions that guarantee that the government does not spend more than its genuine tax revenues over reasonable periods of time.

Keywords: Deficits; Macroeconomic history; Inflation; Government budget constraint; Fiscal and monetary interactions;

JEL Classification: E31; E42; E63; E5; N16;

https://doi.org/10.21034/sr.580

Bibliographic Information

Provider: Federal Reserve Bank of Minneapolis

Part of Series: Staff Report

Publication Date: 2019-02-01

Number: 580

Pages: 31 pages