Carneros y Chuño

Carneros y Chuno: Price Levels in Nineteenth-Century Peru Author(s): Paul Gootenberg Source: The Hispanic American Historical Review,
Vol. 70, No. 1 (Feb., 1990), pp. 1-56 Published by: Duke University Press Stable URL: http://www.jstor.org/stable/2516366 . Accessed: 06/02/2014 14:04
Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at . http://www.jstor.org/page/info/about/policies/terms.jsp
.
JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org.
Duke University Press is collaborating with JSTOR to digitize, preserve and extend access to The Hispanic American Historical Review.
http://www.jstor.org
This content downloaded from 157.193.1.106 on Thu, 6 Feb 2014 14:04:14 PM All use subject to JSTOR Terms and Conditions
HispanicAnericani Historical Review70:1 Copyright ?) 1ggo by Duke University Press CCC oo08-2168/go/$1.5o
Price Levels Carnerosy Chunio: in Nineteenth-Century Peru

PAUL GOOTENBERG*
mainsan exampleof statistical "darkages." The Peruvian statewas essentially prestatistical; untilrecently, it lacked the need and capacityforsystematic collectionof economic, social, and demographic indicators on so nominally a governedpeople. The challengeofunearthing and preparing usable data thusfallsto modern students ofPeru. In the past decade, historians have managedto create fromscratch new estimates tradeand exportactivities like fruitful of Peruvianforeign mining. Theyhave revisedfigures on suchelusivequantities as theexpanand external sion of the public sectorand its internal debts. New statisticson demographics, land tenure, businessand monetary history, tariffs, laborforce,and grossnational product have appeared.' Mostofthesead*1 thankthe American Council ofLearned Societies,Social Science ResearchCouncil, and Office ofthe Provost, BrandeisUniversity, fortheirresearch support.Shane Hunt provided both inspiration and his usual pricelessadvice, alongwithRichardSalvucci,Vincent Peloso, RoryMiller,and JohnCoatsworth. For the initialstage of research,I am grateful to RosemaryThorp, Carlos Bolofia,Alfonso Quiroz, and to Gabriela Ramos forresearch assistance. 1. Shane J. Hunt,"Growth and Guano in Nineteenth-Century Peru,"discussion paper in EconomicDevelopment 34, ResearchProgram (hereafter RPED) (Princeton, 1973)(cited below insteadofabridgedversion publishedin The LatinAmerican Economies:Grotvth and theExport Sector, 1880-1930, RobertoCort6sConde and Hunt, eds. [New York,1985], 225-319) and "Price and QuantumEstimatesof PeruvianExports,1830-1962,"discussion paper 33, RPED (1973); Heraclio Bonilla, "La coyuntura comercialdel siglo XIX en el W. Quiroz, La Peru," Desarrollo Econ6mico, 12:46 (July-Sept.1972), 305-331; Alfonso detudadefraudada:Consolidaci6nde 1850 y doininjoecon6onico en el Perti (Lima, 1987); de la rept'blica, Jos6Deustua, La mineriaperuana y la iniciaci6n 1820-1840 (Lima, 1986); CarlosContreras, Mineros y campesinos en losAndes(Lima, 1987);Cecilia M6ndez,"La otra historiadel guano: Peru, 1840-1879,"Revista Andina, 5 (July1987), 7-46; Nils Jacobsen, "Landtenure and Societyin the Peruvian Altiplano: Azangaro Province,1770-1920" (Ph.D. of California, diss., University Berkeley,1982); RoryMiller,"The PopulationProblemin Late Nineteenth-Century Lima" (manuscript, Amsterdam, 1988); Carlos A. Bolofia,"Tariff Policies in Peru, 1880-1980" (D. Phil. thesis,Oxford University, 1981); Paul Gootenberg, "Artisans and Merchants: The Makingofan Open Economyin Lima, Peru, 1830 to 186o" and Ethnicity in Early Repub(M. Phil. thesis,OxfordUniversity, 1981) and "Population
MONG
other dark Perurelegacies, nineteenth-century
| HAHR I FEBRUARY
I PAUL GOOTENBERG
vancesstillcoverthefairly accessibleexternal and formal sectors ofPeru's economy, however, and we are a longwayfrom statistics worthy offormal economicanalysis.Scattered archival sourcesdo in factexistfora variety is our lack ofa domestasks.But a conspicuous bottleneck ofquantitative tic price series-a critical toolforadvancedanalysesofeven the meager statistics on hand. new information This studyoffers on consumergoods prices from nineteenth-century Lima and attempts to work them into a standard index and long-run estimates While prelimicost-of-living of inflation. nary,these price deflators may be used formeasuring "real" economic call growth at constant trends,thatis, whateconomists prices. Inflation, beas we knew fromsuch qualitativesignsas popular bread protests, came chronicin republicanPeru, and thisfacthas bedeviled historians' efforts describedevelopment. to nominalexpento accurately According dituredata, forexample,the Peruvianstatewould have expandedsome ten timesin the course of the guano age-surely an exaggeration if not even in theirsimplest controlled forthe era's inflation.2 Moreover, forms, the linksbetween broad economicdevelopprice data help illuminate Peru slogged mentsand everyday social life.In the nineteenth century, twodecades oflate colonialeconomic turmoil through (1800-24); twodecades of postindependence depression(1824-45); and three decades of frenetic guano prosperity, beforethe exportcollapse of the mid-1870s. Prices are a clue to how these eventsstruck Peruviansand to ordinary in socialhistory. numerous otherproblems Readers should note, however,thatall measuresof price levels are and thusopen to endless imlittlemore than an economist's invention, provement and interpretation. Historical-even current-price data are such as Peru, especiallyifculled from notoriously poor forcountries secstandards ondaryaccountswithill-defined ofcollection.Moreover, most
lican Peru: Some Revisions" (forthcoming, LatinAmerican ResearchReview,1ggo). By no meansis thisan exhaustive listofrecentquantitative studies. of Peru's pioneerstatisticians This is not to underestimate the contributions (such as see the Garland and Rodriguez), whose concerted workbegan at the turnof thiscentury; A Guide to Economic excellenit survey by Huntand Pablo Macera,"Peru,"in LatinAmerica: History,1830-1930,Cort6sConde and Stanley J. Stein,eds. (Berkeley, 1977),548-578. 2. Hunt, "Growth and Guano,"Tables 8-9 (whichconsiders thisinflation problem)or Javier TantaleanArbulu, Politicaecon6mico-financiera y laformaci6n del estado: SigloXIX (Lima, 1983), chaps. 11-12 (whichdoes not). Price researchis scantforPeru; apartfrom Quiroz (below), the onlystudiesare colonial.For Cuzco, see Luis Miguel Glave and Maria Isabel Remy,Estructuraagraria y vida rural en una regi6nandina: Ollantaytambo entre los siglosXVI y XIX (Cuzco, 1983),chap. 11. Thereare also twounpublished 1975data collectionsby Macera forArequipa(1627-1767) and Lima (1667-1738). A preliminary version ofthispresentstudywas Gootenberg, "Artisans and Merchants," App. 11, whichshouldno longerbe cited.
PRICES
IN NINETEENTH-CENTURY
PERU
archival ofthe existing priceseriesforLatinAmerica come from the colonial era or fromruralzones, and not from cosmopolitan centerssuch as the one purposely selectedhere. Understandably, then,we have as yetno Latin comprehensive or methodical price indicesfornineteenth-century America.3 This exerciseaimsto spurfurther research, simply by showing itsfeasibility. The opening sectionpresents the new archival foodprice data used. The following sectiondevisesappropriate priceweights fora nineteenthindex. These prices and index then yield new centurycost-of-living estimates and periodizations ofPeruvian pricemovements. Besides illusthe steps to a historical the trating price index,the studyunderscores of social history evidence forquantitative tasks. And it indispensability in detailsomeapplications ofthe new statistics to concludesby exploring the economic,social,and political ofPeru. history Food PriceData never amassed systematic Peruvian governments price data in the fourpublishedsources nineteenth century. For fragmentary information, exist.In 1870, amid rising urbanunrest oversubsistence costs,a regional headed by Lima MayorManuel Pardo put out a i6i-page commission The survey, ofheated opinionson reporton inflation. consisting mainly the roots of the problem,also containswholesale data for29 common meatand grainproducts, in orderto compare and 1869. pricesin 1854/55 Basadre presented some ofthesehaphazardly collectedprices,and Jorge Pablo Macera even tabulatedtheminto a series,withina wide-ranging at theheight qualitative discussion ofinflation oftheguanoage.4The commission's data reveala doublingofpricesforsome staples,such as lentils and chicken, overthe 15 years.
"Estadisticas priceindexis Miguel Urrutia, to a nineteenth-century 3. The closestfind de estadisticas de Colombia,MiguelUrrutia hist6ricas de precios,1846-1933"in Compendio theinadequaciesofbasing eds. (Bogota,1970),chap. 3, whichrecognizes and MarioArrubla, weights.For some ofthe many data fitted to modernexpenditure the indexon intermittent of Eighteenth-Century see Essays on the Price History advances in colonialprice history, eds. (Albuquerque,1989). Most and EnriqueTandeter, Latin America,LymanL. Johnson inflation, Latin Americanprice indices begin around 1913-17,when new methodologies, see B. R. Mitchell,International and politicalpressuresmade price researchimperative; TheAmericasand Australasia(Detroit,1983),Tables 11-12, 844-845. HistoricalStatistics: Datos e informes sobre las causas que han producidoel 4. Lima, Consejo Provincial, en la capital (Lima, alza de preciosde los articulosde primeranecesidadque se consumen in Trabajos de historia, azucarerasandinas(1821-1875)," 1870); Macera, "Las plantaciones Basadre,Historiade la Reptiblica Macera, comp., 4 vols. (Lima, 1977),IV, 235-275; Jorge reportis del Peru, 7 vols., rev. 5th ed. (Lima, 1963-64), IV, 1761-68. A morequalitative Hunt uses the en Lima, 1875 (Lima, 1977, reprint). Carestia de viveres J. B. H. Martinet, see "Growth and Guano,"75. 1855/69 pricesmostmethodically;
| HAHR I FEBRUARY
I PAUL GOOTENBERG
More recently, thehistorian Alfonso Quiroz,seeking waysto assessthe social impactof the "consolidation" of the internal debt, discoverednew foodprice data fortheperiod 1847-65. These retailpriceswere gathered from hospitalledgersat thecharitable archive ofthe Beneficencia Puiblica de Lima, and cover 23 itemsof popular consumption, such as carnero (mutton), beans, chickpeas,rice, and chuno (Andeanfreeze-dried potatoes).5The dramaticfluctuations evidentin certainitemsled Quiroz to identify twopeak "crisesde subsistencia," in 185oand 1856. Two otherworkslie at the extremes ofthisstudy, and some of their data can be incorporated. MarcelHaitin,after digging in accountsofhospitalsand suppressedmonasteries (in a hostofarchives), averagedprices forsevenmajorfoodcommodities oflatecolonialLima (1799-1824),which reveal,he argues,a hiddendynamism in the regionalagrarian economy. On the otherend of the curve,following the gravemonetary upheavals of the PacificWar, otherLima commissions investigated risingprices of some twelve majorcomponents of the Lima diet, whichforman 1897Stillotherhistorians, 1906 series.6 such as VincentPeloso, have explored qualitative aspectsofLima consumption, nutrition, and supplynetworks. The archives are thenthe best and onlysourcefornew data. The appendix to this studypresentsmyoriginal archivalevidence on 29 Lima subsistence goodsfrom 1826 to 1873(see Appendix). These are averagesof weeklyfindings; wherever thepricesare standardized evident, intoreales per pound (8 reales = 1 peso before1862, lo reales - 1 sol thereafter). Prices of minorproductssuch as herbs,and price fragments, are omitted, but the appendixdoes includethe usable (consistent) data from the publishedworks just mentioned. Some of the new prices, following Quiroz's lead, are derived from bimonthly recordsoftwo hospitals, San Andresand La Caripurchasing
5. Quiroz, La deuda defraudada,109-123 and App. I, whichanalyzesthe data more fullythan his 1980 B.A. thesisand makesuse of my 1981 index. This archiveis not very accessible. 6. Marcel Haitin,"Prices, the Lima Market,and the Agricultural Crisis of the Late in Peru,"Jahrbuchfiir Eighteenth Century die Geschichte vonStaat,Wirtschaft und Gesell22 (1985), 167-198; an abridgedversion schaftLateinamerikas, appears in The Economies of Mexicoand PeruDuringtheLate ColonialPeriod,1760-1810, Jacobsen and Hans-Jiirgen Puhle, eds. (Berlin,1986), 281-298. MostofHaitin's data(which cover13 products) are from the Hospital Real de Santa Maria (in the Beneficencia archive);othersare fromhospital, school,and convent accountsin theInstituto and Archivo Generalde la Naci6n, Riva-Agiuero Lima (hereafter AGN). See also Lima, Camara de Comercio,Memnoria presentadapor el Consejo de Administraci6n de la Camara de Comerciode Lima a la JuntaGeneral de 1i defeb. de 1899 siendopresidente el sr. D. ManuelCandamo (Lima, 1899); pricestabulated (withothers)in PeterBlanchard, The Originsof thePeruvianLabor Movement, 1883-1919 (Pittsburgh, C. Peloso, "Succulenceand Sustenance:Region,Class 1982), Table 7; Vincent and Diet in Nineteenth-Century Peru," in Food, Politics,and Societyin Latin America, John Super and ThomasWright, eds. (Lincoln,1985), 46-64.
PRICES
PERU
dad, and ofthe Colegio de San Carlos,all maintained by the Beneficencia (for 1826, 1829, and 1840-65).7These are retailprices, the favorite of price historians, and robustenoughwithmorethana dozen readingsa year,usuallyfrom theiroriginal market receipts.While the charity may have received some unusualbargains (on bread forinstance), the market pricesalso were checkedbya scrupulous comptroller. Similar institutional accounts for government-run convents were discoveredin the Archivo General de la Nacion (AGN): the infirmaries of San Franciscoand Santo Domingo list excellentdata for1829, 1831,and 1833.8 Another mine of price quotations is the booksofmilitary hospitals (suchas SantaAna) run by the Ministry of War and Marine.9 Located as well in the AGN, they providea completeseriesoffooditems for the 1830s,based on the typical inventory of purchasereceipts. Unfortunately, archivalrecordsbecome sporadicafter 1843;weakerserieswereencountered undertheMinistry of Government for1848-52 and 1859-65 (San Carlos, San Bartolome, Santa Ana, and San Andres).'0
tales y Colegios; Cuenta por Colegio de Educandas de la Caridad, 1826-27, 9302/69; Gasto
7. Archivode la Beneficencia Publicade Lima (hereafter ABPL), Librosde los Hospi-
diariopor Hospitalde la Caridad, 1826-27,9301; HospitalUnidode SantaAna-cuenta de gastos, 1828, 9202; Hospitalde San Andr6s, planillade pagos, 1840-41, 9051; Cuenta general de cargoy data del Hospitalde la Caridad, 1841,9302; Cuentageneralde cargoy data del Hospitalde San Andres, 1842, 9052; and varied1830S fragments from Cofradiarecords. (Gabriela Ramos graciously assistedin research.)I also use Quiroz's analogousABPL data (La deuda defraudada,App. I) from the San Andr6s and SantaAna hospitals,1847-56 and 1859-65; note,however, modestdifferences (in theappendix) from myresearch in the same hospitalrecordsheld in the AGN. 8. AGN, sectionR. J. (Ministerio de Justicia), Cuentas de ConventosSupresos, San Francisco, Gastos de esta enfermeria, 1829-32, leg. 5; San Francisco,Descalzos, Santo Tomas, Santo Domingo, Enfermeria y cuentas,1829-33,leg. 6. The eleven otherlegs. are usefulforwage data only(some outside Lima), or alreadyform the basis forHaitin'scolonial series,"Prices and the Lima Market," App. 11, Tables 1-12. The first six yearsof the appendix are averagesfromhis data (whichcover additional years);the 1799/18oomeat prices are fromMaria Pilar P6rez Cant6, "Abastecimiento de la ciudad de Lima en el s. XVIII," in Historia problemay prornesa: a JorgeBasadre, F. Mir6 Quesada, Homnenaje F. Pease, and D. Sobrevilla, eds., 2 vols. (Lima, 1978),I, 467-470. Marina,HospitalSantaAna, 1829, H-1 OL 189/1128-1167; Guerray Marina,Cuentasy gastos del HospitalMilitarSantaAna, 1830, H-1 OL 200/2034-2056; HospitalMilitar de Santa
9. AGN, Hospitales Militares, 1826, H-1 OL 152/1079-1172; Ministerio de Guerra y
Ana, 1831, H-1 OL 210/1525-1528; Santa Ana, 1832, H-1 OL 218/1045-1056; Santa Ana, 1833, H-1 OL 227/953-960; Santa Ana/Bellavista, 1834, H-1 OL 235/1411-1414; Hospital Militar, 1835, H-1 OL 243/1167-1173; Santa Ana, 1837, H-1 OL 257/469-501; Santa Ana, 1838, H-1 OL 266/738-756; Santa Ana, 1839, H-1 OL 273/1139-1140. Other years, from 1826 to 1847,were searchedunder"Comisarios" and otherheadings.
io. AGN, Ministerio de Guerra y Marina,Presupuestos de sueldos y gastos de los HospitalesSantaAna, San Andres,y San Bartolom6, 1848, H-1 OL 343/1094-1184; Hospital MilitarSan Bartolom6, 1849, H-1 OL 352/583-595; Ministerio de Gobierno,Instrucci6n PNiblica y Beneficencia, HospitalesSantaAna, San Andr6s y San Bartolom6, 1850, H-i OL 356/591-637;Santa Ana y San Andr6s,1851, H-1 OL 363/705-728; Cuentasy planillasde
gastos diarios del Colegio de San Carlos, 1852, H-1 OL 371/330-596; San Carlos, 1856, H-1
| HAHR
I FEBRUARY
I PAUL GOOTENBERG
Except forthe lacunasof 1843-46 and 1857-58,a completeand consistent archival price seriesnowexistsfor1830-65. Combinedwithother 1826 to 1873. sources,a reliableand wide record foressentials exists from Whenwe includesomeofHaitin's archival colonial prices(whichlackvital the series mutton and beef), and interpolate stableyearsfrom fragments, runsfromi8oo to virtually the Pacific War. A mostlamentable gap yetremains-theyears1874-79.The late 1870S were a timeofseveremonetary instability, a periodwhosedata are critical the through forany price indexthataims to connectour macrostatistics soughtin the denouement ofthe guanoage. These priceswerefruitlessly will no doubtresolve sources.Otherhistorians arrayofavailableprimary the 1870S gap as theyuncoverpurchasing recordsof nearbyhaciendas, or military units.Whatcannot be resolved is a directlinking monasteries, War." The era's chaotic the Pacific of price seriesfrom beforeand after devaluationsand inflation (reaching perhaps8oo percentbetween 1879 and 1885) mustsoberanyhistorian. One notablestrength ofthepricesis thattheyare virtually freeofthe thatbedevil mostpreindustrial seasonalvariations pricesseries. Lima lay wherecropsand livestock in a semitropical could be agrarian hinterland, The diversity of foreign supplied withgreatregularity. suppliersto the in also smoothedfluctuations coast (of grains,beans, and otherarticles) market In fact, theonlyperiodicdisturbances thisconsummate economy. levelwere the sharpman-made monthly price perceptibleat the archival hikes that could occur duringcaudillo wars,when supply routeswere blocked. (One sees this graphically, forexample,at the climaxof the civil war of L834.12)A weaknessof thisseries,on the otherhand, is the
de Guerray Marina,Documentos de los gasOL 398/1121-1135; Ministerio comprobantes tos del HospitalMilitar,i86o, H-i OL 432/1059-1084; HospitalesMilitares, 1861, H-1 OL
439/1715-1725; Presupuestos del Hospital Militar, 1862, H-i OL 447/1578-1592; Tesoreria Principal,Presupuestode gastosdel HospitalMilitar, 1864, H-i OL 460/1326; Inspecci6n
del Hospitalde San Andr6s(and SantaAna), i865, H-i OL 472/361-381. ii. The i897-i9o6 appendix from Peruvian prices(averaged Blanchard, Labor, Table 7) are simplya signpost.Bolonia,"Tariff Policies in Peru,"Tables 3.1 and 3.2 providesthe indirect estimates ofwartime inflation. Quiroz (personalcommunication, 1989) has scouredthe 188os-189osperiod forprice to thosepresented data, to no avail. For the 1870s gap, a logicalplace to seek data similar del Peril; its catalogue,though, here (and regionalprices)is the ArchivoHist6rico-Militar data from convent recordsin the listsno obviousaccounts.Withno success,I also sought Archivo de Lima. Arzobispal 12. AGN, Ministerio de Guerray Marina,Cuentasdel Hospitalde Santa Ana, Jan.seasonalvariations: trendcalculations werewarranted. CompareLimawithBogota'sextreme tables. Lima/Callao's overseas Urrutia,"Estadisticasde precios,"84 and monthly bustling foreven coastalplantation foodstuffs tradewas clearlya factor, pricesreveal greatermarketfluctuation ofHacienda Palto, (Peloso,personalcommunication, 1988,concerning study
1867-70). Mar. 1834, H-i OL 253/1411-1414. With so little seasonal variation, no moving averages or
Variations in productqualitywere also not a problem.Most superiorqualitydesigna-
PRICES
PERU
dearthof data on liquors and otherliquid refreshments-which played a substantial role in the daily lifeof Limenios. When in hospitals,convents,or school,such substances were substituted by a remarkable array of medicinalproducts and herbs,whose make-upmayinterest historians ofmedicine. Other sourcessupplement the archival ones, but mustbe takenwith caution. From time to time, newspapersand census takerspublished reportsfromcity markets.Lima's dailies sometimes started(and then stopped) regularand detailed notations of wholesale and retail prices. datafound wereEl Comercio's Amongthefinest biweekly "Plaza del Mercado" reports for1864-65and La Patria'sanalogouscolumns for1871-73. I also consideredsuch samplesas i828 wholesalelistsfrom El Telegrafo thealready de Lima and 1837CIF import prices(El Redactor Peruano)for significant foodstuffs trade.'3For 186o, there are (probable)wholesale plaza pricesgathered by the indefatigable statistician ManuelA. Fuentes forhis Guta historica-descriptiva, administrativa, judicial y de domicilio de Lima. Like Fuentes'sotherguides,thisis a mineofuntappedstatistical material(usefulhere, forexample,is his quantification ofall agricultural goods brought intothe city).'4 British and U.S. consulardispatches often revealprice data, particularlyforthe graintradesthatso interested bothparties(after 1843,British consuls were systematically flour and wheat prices on a world tracking British memofrom basic living costs scale). One suggestive 1842 compares in seven major Latin Americancapitals,no doubt as a ploy forhigher salaries.Bear in mindthatLima,withitscramped reagrarian hinterland, mainedthe dearestofall regional boththecomplaints of posts,confirming its inhabitants about highcostsand theovervalued natureofitscurrency.
tions (notablyformeats and flours) are clearlyindicatedwithprices (mostcommonly, in periodicalmarket lists).In the archival military and religious records, qualitiesare remarkin the supplementary ably consistent (i.e., verybasic), and thosewere the gradesfollowed sources. 13. "Plaza de Mercado,"El Comercio, Sept. 2, 1862, all Jan.-June 1864; "Cr6nica," ibid., all May-June, Aug. 1865; "Preciospor mayorde productosnacionales,"La Patria, all Oct. 1871, Sept.-Dec. 1872,Jan. 1873,withseparatemeatreports; "Precioscorrientes, por mayor,de la plaza de Lima," El Tel6grafo de Lima, Aug. 12, Sept. 1, Nov. 12, 1828; El RedactorPeruano,all May-Oct. 1836;El Mapa Politicoy Literario, all June-Oct.1843 (grainprices).(All newspapers are published in Lima.) Newspapers also containmanyprotestarticlessuch as "Carestia" and "Carestia de carne," El Comercio,Sept. 28-30, i865; or "Crecientecarestia,"La Patria, Mar. 7, 1873 that year). Again, all available (which, for example, claims food prices rose "one-third" papers were searchedformissing data years;newspaper price fragments are omitted from the appendix. 14. ManuelA. Fuentes,Guia hist6rico-descriptiva, administrativa, judicial y de domide algunosviveres,licoresy de otros cilio de Lima (Lima, i86o), esp. "Precioscorrientes articulosde primeranecesidad," 233-234 and all chap. 4. I use such surveysbelow for expenditure weights.
| HAHR I FEBRUARY
I PAUL GOOTENBERG
Prices forfood, housing,and servants were twicethoseof Santiagoand Buenos Aires,even beforethe Peruvianinflation of the 850os.'5 Finally, along withsuch supplementary prices,I takeMacera'stabulateddata for 1855 and 1869 (and his strong flour series)also intoaccount,despitetheir 6 sometimes uncertain provenance. Historically, Lima was thewheatbread capitalofSouthAmerica, making the price of bread a special problem.Most accountsreporta constant,customary, or controlled price of bread throughout much of the century-the postura de pan availableat bakeriesat fourto five"pieces" a real, or less forcharities. In fact,the quality and weightoftheseloaves variedwidely.Oftenwiththe connivance ofthe municipality, monopolistic bakersadjusted loafsize and adulterated flour their gradesto reflect real costs. Therefore, where possible, wholesaleflourprices constitute the bread series,and, wheretheseare lacking, U.S. wholea correlated sale indexis used (in the earlyrepublic,substantial and North American Chilean flour imports stabilized pricesin Lima)."7 The wobblydownward is moreprecisethantheconstant trendthatresults priceofbreadassumed in otherworks. In Table I, all ofthe usable data are simplified into L830-based indices In thisstudy,1830 will be the foreach of eleven majorfood categories. reference year;by then,priceshad clearlysettled at traditional levelsfolcalculationof the expenses of 15. H. Wilson to Earl of Aberdeen,"An approximate livingin the severalcapitalsofthe SpanishAmerican states," Aug.7, 1842,in PublicRecord and consular Series6i, Correspondence betweenBritish Office, ForeignOffice, diplomatic FO 6i/vol.),FO 61/93. A similar1826 reofficers in Peru and the ForeignOffice (hereafter to Canning,July ofpricestwicethose port(Ricketts 22, 1826, FO 6i/8) already complained foundelsewhere.Typicalgrainreports are Miller,Dec. 31, 1842, FO 61/92 and Mar. 27, in Despatchesfrom North American is found 1843, FO 61/98. A price samplefrom reports U.S. consulsin Callao, U.S. NationalArchives, RecordGroup 59, M-15 (hereafter M155/ vol.), Trevill,Oct. 1, i86i, M155/4. Tables 35-37, 39 (orig.source:Consejo Provini6. Macera, "Plantaciones azucareras," as to how theseprices sobreel alza de precios);nota clue is provided cial, Datos e informes are often were gathered,though different locations indicated.Martinet's 1870s Carestia de on price data. viveres,despitethe title,is veryshort Table 39 (1852-69) or above 17. Flour pricesfrom Macera, "Plantaciones azucareras," consularand archivalsources;1800-40s U.S. indexfrom HistoricalStatistics of the United States:Colonial Timesto 1970 (Washington, 1975),Part1, Table E-124. WheatFlour, 18oo1970 (Philadelphiawholesale). Cross-checked withless-useful Chilean data in ArnoldJ. theSpanishConquestto 1930 (Cambridge, Bauer, Chilean Rural Societyfrom 1975),App. 1 and Sepuilveda series. (Santiagoflour) For insightinto bread markets, see Gremio de Panaderos,Aclaraci6ndocumentada la contienda de panaderos,dada por la JuntaDirectiva sobre las causas que han promovido de Lima (hereafter del Gremio(pamphlet, Lima, 1842); or Archivo Municipal AML), Libros a variety at food of earlyattempts de Cabildo, 1824-38, nos. 46-49, whichalso document price controlsin the city.On the initialU.S. supplyrole, consultGootenberg,Tejidos y El imperialismo norteamericano del librecomercio en el Perut, harinas,corazonesy mentes: 1825-1840 (Lima, 1989),chaps. 2-4.
PRICES
PERU
TABLE
I: Indices ofKey Food Groups(1830 = 100)

17991800
104
Item/year Mutton Poultry Lard Rice Beans

Noodles Beef
18041805
(104)
180910
-
181415 94m 82 208 85 100
181920 lO1m 101 364 132 100
182223 130m 190 272
1826 1827 100

139 117
72
(72)
96m
103 123 (90) 91 106 119 102

113 85
89 265 93 83 125 201

-
89 294 108 75 105 183 97
(89) 224 90 105 99 165 101

-
129 90 88 126
87
Cooking fuel
Sugar Bread/flour Others
89 103 171 229 167/135w 116/439w 134/772w 96 105 132 112

120
81
100
149
Item/year Mutton Beef Poultry Lard Rice Noodles Sugar Bread/flour Cookingfuel Others Item/year Mutton Beef Poultry Lard Rice
Beans Beans
1828 1829 1830 1831 1832 1833 1834 1835 1836 1837 1838 109 125 111 140 68 100 107 108 108 100 1839 73 81 95 155 76 62 107 148 150 96
63
95
-
95 88 87
100 100 100 100 100

100
99 92 86 118 86
100
86 90 97 150 63 94 76 99 100 109

94
80 87 115 177 63
108
(100) 102 (108) (100) 1840 66 80 79 168 68 60 64 106 125 85

-
100 100 100 100 100 1841 67 80 79 113 63 60 76 112 125 88
81 71 114 100 94 1842 64 81 79 116 63 60 75 111 (125) 88
98 81 124 111 108
(108)
81 88 107 201 85
80 (80) 82 (82) 93 (93) 133 50ws (85) 47ws 88 70 118 113 97 1848 61 75 105 109 58 56 74 119 96 66
83 -
71 81 102 130 69
58
72 81 95 133 70
94 67 100 108 90
(88) 60 178 (113) 116 1849 80 78 105 112 100 54 67 90 100 81

99
(58)
104 182 152 104 1850 85 82 109 116 92 55 85 74 100 89

96
93 160 150 132 1851 84 82 116 133 64

103
1843-46
1847 (61) 77 (105) 116 56 44 77 134 (96) 83

91
Noodles Sugar Bread/flour Cookingfuel Others
(96)
51 81 90 100 92
lowingthe extraordinary supplydisruptions of the independencewars. These indices are averagesof the mostconsistent and reliableappendix the maze of theirstandardization ratios from intoreal/pound prices,after unitsand, forsomefoods,differing archivalquantity qualitygrades.(The such archaicand imprecisemeadauntingchallengeis safely converting sures as botijas,cargas, costales,or sacos ofrice.) The numberofminor and occasionalproducts is further reducedin thetable,exceptinsofar as a
10
I HAHR
I FEBRUARY
I PAUL GOOTENBERG
TABLE
I: (continued)
1852 (84) 92 (116) 66 (103) 65 (81) 94 1853 91 92 126 1854 82 87 111 1855 82 87 158 1856 (82) (87) 143 1857-58 1859 91 156 142 1860 106 264 221 1861 91 185 (221) 1862 91 185 (200)
Item/year Mutton Beef Poultry Rice
Lard
109
Beans Noodles
Cookingfuel Others
Item/year Beef
Sugar Bread/flour
101
1863 162 (200) 193 80
70 109 60 60 83 (107)
99
133
90
89 46? (60) 67 75 107
103
72 92 53 67 94 (107)
155
227
120 242 55 96 102 100
228
86 92 55 117 88 146
88/94
84
126
1869 242 190 310 98 233
-
85
123 209 63 139 78 114
187
119
111 (209) 56 103 73 114
162
(111) 50 108 80 114
177
81
82
1864 183 (200) 157 97 166 105 70 116 135
1865 177 204 232 83 261 65 104 73 (116) 137
1866-68 (272?)-
1870
1871 289 (190) 217 154 218 100 172 65

-
1872 361
-
1873 361
Mutton
91
91
140
136
(136)
(190) (310) (98) (233)
-
211
157
157
Poultry
Lard Rice
Beans Noodles
Cookingfuel
Others
Sugar Bread/flour
88 72 (114) 87
150 50
55
80/94/92
106 78 146 115
(106) (78) (146) (115)
194 173 213 85 150 59

-
(194) (173) (213) (150) (59) (101)
(101)
101
Source: Appendix,averagedprices. ( ) = interpolations; (m) = meat averages;(w) = warwheatprices;(ws) = wholesale."Others"is meanofpotatoes,chuno,chickpeas,maize, see n. 18. squash, and soap. For unitconversions,
combined"Others"indexrepresents pricesofpotatoes, chuiio,chickpeas, maize, squashes,and soap.'8 On the whole, despitethe occasionalobstaclesplaced by supplymoLima's populace clearlyfaced a nopolies and municipalprice controls, diverseagrarian markets. were subsupplyshedand competitive Limenios
i8. Throughout thisstudy, minor price gaps (onlyin stableyears)are filledusingitem swings backto 1830pricelevels. pricesfrom theprior year.This method avoidsunwarranted See n. 30, below, on treatment ofbase years. Standard conversions includei arroba= 25 lbs.; 1 quintal= 4 arrobas= 100 lbs. Fanega measuresare by volume,and thusvarywiththe product;e.g., maize = 135 lbs.; wheat = 190 to 196 barrelsrangedfrom 135 lbs.; beans = 182 lbs.; lima beans = 156 lbs.; and flour lbs. (sources:Barton,June30, 1843, F061/99; Miles, Aug.9, i855, M155/1)."Sacos" con200 lbs.; maize, 154 lbs., etc. (La versions are fine flour, 200 lbs.; beans, 200 lbs.; chickpeas, includerice, io (from simultaneous readings) Bolsa, Jan.4, 1842). Interpolated conversions at 180-190 lbs.); firewood, 30 tercios botijas = 2 sacos or 1 costal/carga (withsacos/fanegas = 1 carga = 1.15 quintal.For wholelambs,the conversion rateis 8 kilograms per head (or de Lima,"469. 20 lbs., laterweights): see P6rez Cant6,"Abastecimiento
PRICES
PERU
11
ject to shortand long-term price shifts in stapleslike meat,rice, beans, and cookingfats. Yet, even these disaggregate figures suggesttrends. Mostpricesskyrocketed theindependence during thenquickly struggles, stabilized.By theearlyrepublican period,between1830 and 1848, prices in decline,as northern appear largely chacras,haciendas,and tradecontinuedtheirrecovery from the woundsofwar.'9Overall,meatpricesdescended some 20 to 40 percent,and similarfallsaffected rice, beans, noodles, sugar,and a hostofminor goods. After 1848, the reverseset in: an inflationary movement. Risingpricesappear morefitful and flagrant in some lines ofconsumption-poultry, beans, rice-than in others-sugar, pasta, and imported flour.(The late 185os emergency decrees fordutyfreefood imports coincidecloselyin timing and products withthe price hikes observedhere.) By the i86os, mostpriceswould remainfarabove 1840S levels, and some, such as thoseforbeef and beans, at more than twice theiroriginal norms.Manyexplanations, we will see, are available forthese trends. In spiteoftheclarity ofthetrends seen inTable I, individual pricesfrequentlymovedin contrary directions and degrees.In and ofthemselves, moreover, fooddata cannotrevealthe overallimpactofpricefluctuations on popular welfare,muchless be used to deflatenominalstatistics and trends.Such tasksrequirethe construction and application ofa weighted cost-of-living index. A Nineteenth-Century Index Cost-of-Living A cost-of-living index,such as thosebased on modernsurveyanalysis, is a weightedaverage of price relatives over time. Put simply,the statistic showsthe proportional changein overallexpenditure needed to a fixed maintain level ofconsumption, as measured in sometypical "basemarket year"family basket.If a laterbasketB, withidentically weighted items,costs 15 percentmoreto purchasethantheoriginal basketA, then is 15 percent.20 inflation While in some sense a culture-bound measure, a cost-of-living index providesa far more meaningful account of price
19. The mostdetailedstudy ofinitial agrarian supplyconditions is JuanRolfEngelsen, "Social AspectsofAgricultural Expansionin CoastalPeru, 1825-1878"(Ph.D. diss., UniverLos Angeles,1977),chaps. 1-3. For emergency sityofCalifornia, free-trade decrees ofthe del Peru (Lima, 1902-), VI, 1850s, see P. Emilio Dancuart,Anales de la haciendapuiblica i7-18. 20. One guide to the practiceof price indexes is R. G. D. Allen, Index Numbers in Theoryand Practice(London, 1975); forprice theory, historians can followDonald N. McCloskey, TheAppliedTheory ofPrice(New York,1982),one ofthefewtexts written with us in mind. But also bear in mindthateven current price indicesin the developedworld come undercriticism, and thatconsumer-price indices,thebest indicator ofwelfare, do not alwaysmakean optimalmacroeconomic deflator.
12
| HAHR I FEBRUARY
I PAUL
GOOTENBERG
movements thannoting thatcertain livingcostsseem to wildlyfluctuate. Economistsoften deploymoresophisticated statistics formacroeconomic GNP deflators, but the consumer-price indexremainsthe mosttangible and directmeasureofall. Peru's government, of course,did not conductconsumer researchin thenineteenth century. Appropriate expenditure weights mustbe devised from scratch, to builda cost-of-living indexthat can employ our new price data forinflation estimates. The earliestPeruvian attempt to scientifically gauge consumption patterns was in 1920; the first official cost-of-living index followedin 1925, thoughan incisivereviewby Shane Hunt calls its accuracyintoquestion(amongotherdefects, it showedbread costing overone-fifth ifstill offamily income).In fact,theoldestreliablesurvey, is the 1957 censusofLima/Callao problematic forsomeitems, budfamily thesemodern gets. For comparison, are displayedin expenditure weights Table II. In lieu of othermethods,Hunt was forcedto fitthese weights to the published Lima 1855/69 price data to calculatedeflators forhis guano-ageGNP figures.2'By his heroicguesswork, pricelevelsrose some 75 percentbetween 1855 and 1869, or only32 percentifone includeda stableprice ofbread. Historians, however, are bound to questiontheanachronistic applicathe 1850s. In a century tionof modernweights to pricesfrom ofchange, were likelyin relative large shifts prices,and thusin budgetweights-as well as in tastesforsuchtraditional delicaciesas carneroand chuno.Other inflation use indirectmethodologies nineteenth-century "guesstimates" withoutthe aid of expenditure weightsor even local price data. Such is exerciseofCarlosBolonia the cliometric forthe 1870sto l900s, whichimfrom between putes domestic pricelevels(an acuteinflation) divergencies NorthAtlantic devaluation. price indicesand Peruvianratesofcurrency This methodology be appliedto theearlier cannot era,whichlacksdecent since it uses cross-national index compariexchangerate data. Further, from ofpricemovements sons,it is less reliablethanthedirect knowledge index.22 The nineteenth for all thesereasons, a consumer century, requires itsown cost-of-living weights.
21. Hunt, "Real Wages and Economic Growth" (manuscript, Princeton, 1974), later published as "Evoluci6n de los salarios reales en el Peru: 1900-1940," Econornia (Lima), 3 (June 1980), 83-124. The anomaly in the 1957 survey is the high proportion of food outlays
withhighmeatoutlays affluence)-which maynotbe fully (suggesting poverty) (suggesting formeat,discussedbelow. cultural explicableby the Limefio preference Direcci6nNacionalde Estadistica y Censos, Boletinde The weights in Table II are from EstadisticaPeruana, 5/6 (1962), 24. For earliestsurveys used in comparison, see Oscar F. Arrns,El costo de la vida en Lima y causas de su carestia(Lima, 1927) or Estadisticade indicadores(Lima, 1920). See Hunt,"Growth and Guano,"75, i87, for precios y numeros inflation whichcould notbe replicated estimates, here. con22. Bolonia, "Tariff Policiesin Peru,"Tables 3.1, 3.2, and App. A.3 4-9. Actually,
PRICES
PERU
13
TABLE
II: ModernExpenditure Weights (Lima/Callao,1957)

Percentage offamily budgets Workers
Item All Food Bread (Meat) Beef Mutton Pork Oils/lard Rice Beans Sugar Noodles Potatoes Corn Flour Milk Coffee Housing Clothing Diverse Transport Furnishings Health Recreation Liquor and tobacco Education/culture Totals: 55.61 5.17 (22.92) 12.15 3.44 7.33 2.52 5.17 4.24 3.25 1.38 5.03 0.69 0.44 2.47 2.34 12.65 10.07 21.67 7.47 5.86 3.73 1.79 1.86 0.96 100.00
of Percentage foodbudget 9.30 (41.22) 21.85 6.19 13.18 4.54 9.30 7.62 5.84 2.48 9.00 1.24 0.80 4.44 4.21
Whitecollar 47.04
15.92 12.32 24.72 8.55 5.39 4.40 2.67 2.38 1.33 100.00
Sources: Direcci6n Nacional de Estadisticay Censos, Boletinde EstadisticaPeruana, 5 (1962), 23-25; food tabulationbased on Hunt, "Real Wages and Economic Growth," Table 4-15.
is a difficult but not impossible Constructing these historical weights task.The methodfollowed here buildsrudimentary expenditure weights
the fixed sular recordsshow thatnineteenth-century Peruvianexchangeratesvariedfrom withexport 15, 1859, M 155/ official rates,fluctuating conditions; see, e.g., Milesto Clay,July 3. Untilthe i86os, official exchangerateswereinvariably listedas one peso = one U.S. dolindices(though lar; fivepesos = one ? (British pound sterling). After9goo,consumer-price Peru 1890-1977: Growth unlinkable)begin. See Rosemary Thorp and Geoffrey Bertram, and Policyin an Open Economy(New York,1978), Tables 6.9 and 6.i6. The Colombian price indexcitedabove (n. 3) relieson modern weights. is discussedin R. BaThe methodological "indexnumber problem" ofpricecomparisons con and W. Beckerman,"International Comparisons of Income Levels: A SuggestedNew Measure," Economic Journal, 76:303 (Sept. 1966),pp. 519-537 or SimonKuznets,Modern and Spread (New Haven, 1966),chap. 7. EconomicGrowth:Rate, Structure,
14
| HAHR I FEBRUARY
I PAUL GOOTENBERG
TABLE Item
III: Artisan Diet Weights, 1869

In grams 460 287 172 115 57 41 57 24 460 3 3 2 24
(%) As expenditures
Meat Bread Rice Beans Sugars Lard Noodles Fuel Others 34.25 10.53 8.02 8.02 5.15 4.95 1.77 21.69 5.62
Amended(%) 34.3 21.0 8.0 8.0 5.1 4.9 1.8 10.8 6.1
Meats Bread Rice Dried beans Whitesugar Brownsugar Lard Noodles Fuel Milk Tea Vinegar Salt Minor...
Totals 1,705 gramsat 35.5 centavos
100.0
100.0
sobre el alza de precios (1870), Datos e informes Sources: Lima, Consejo Provincial, 117; see textformethod.Amendedby foodbudgetsofHospitalSantaAna, Feb.-May 1837, AGN H-1 OL 257/469-501.
1869,archival hospital budfrom threesources:a modelartisan dietfrom thecity ofLima in 1837. gets,and aggregate consumption expenditures for The combinedmidcentury to modernsurweights maythenbe compared index forthe vey weights,thoughthe aim is to create the mostfitting historical pricerecord. The closest findto a contemporary food budget surveyis an exemplary artisandiet fromLima's Escuela de Artesy Oficios.Fortunately, the 1869 regionalprice commission publishedthismodel,as theircrude The way ofsuggesting the impactofinflation on popularlivingstandards. at a totalcost of35.5 artisans'dailyfoodintakewas listedonlyin grams, With but minorheadaches, unitfood prices of 1869 can be centavos.23 to reveal relativefood expenditures; multipliedagainstgram quantities these are reassembledin Table III as percentage weightsof a fullfood budget. withfood budgetsanalyzed The resultsare by and large compatible the century. We can say thatthe typifrom hospitalarchivesthroughout cal Lima family ofitsfoodbudgeton meats(we spentroughly 34 percent knew that Limefios were voraciousmeat eaters);5 percenteach on lard
sobreel alza de precios,117,used withprices Datos e informes Consejo Provincial, 23. the few missingitemprices for 1869. arise frominterpolating the difficulties throughout; to dailyracionescosts,e.g., thoselistedin Hospitalde Santa Ana, This diet is verysimilar 3 to 3.25 reales; see also sailors' whichrangefrom Jan. 1865, AGN H-i OL 472/382-388, in El RedactorPeruano,Nov. 14, 1836. rations
PRICES
PERU
15
and 8 percenton each of and sugars(and thattheirdiet was unhealthy); theseproportions werehomothe staplesofriceand beans. Furthermore, class geneous forthe populationat large,forit is knownthatsignificant differences had notyetemergedin creolecuisine.24 were necessary. First,the undifferentiated Two further adjustments on a straight meatweight-forcarnero,beef,and poultry-isapportioned for one-third basis, i.e., 11.4 percenteach, since meatswere substitutes each other.Second, two of the original weights, forbread and fuel,are of21.0 and io.8 percentrespectively, readjustedto realistic proportions The need to get bread right is outlays.25 as calculatedfrom1837 hospital item obviousforLima. Fuel (chiefly firewood) is also a vital,ifoverlooked, to includein a price index.Used in cooking and otherhouseholdchores, (from rapid it suffered as the century progressed sharpprice vacillations deforestation of the coast and the subsequenti86os switchto imported coal). offood outlays,and Diets, however, onlyrevealthe averageweights did subsistence did notlive by carneroalone. Whatproportion Limenios a replay in overallfamily expenses?The best data can be derivedfrom such ofthe city's globalconsumption, markably detailedseriesofsurveys howas the one producedby Fuentesfor1858. The optimalinformation, Estadtsticahistorica, ever, comes fromJose Maria Cordova y Urrutia's in 1837. This census comercial e industrial forLima province geogrdfica, a more completeestimateof area purchases;providesconvincing forms evidenceon the collector's withothersources(such method;cross-checks as consularreports and hospital and avoidssomebizarrerelative records); price shifts ofthe guanoage.26
47-50. In i86o, Limenios consumed97.15 24. Peloso, "Succulence and Sustenance," lbs. per capita of meat, one of the highestlevels in the world(Fuentes, Guia hist6ricoafteri86o, meat supplies,not bread, became descriptiva,158-159). For the municipality after the modelpenitentiary, the new camal was the overriding pacifier forurbandwellers; civicimprovement. the city'sproudest the based on studyof hospitalbudgets throughout 25. Bread and fuel adjustments period; finalcalculations from Cuentas del HospitalSanta Ana, all Feb.-May 1837, AGN documentis Diario de Hospital de H-i OL 257/469-501.The mostusefulcorroborative forbread, meat, fuel,and la Caridad, 1827, ABPL, 9302, whichlistsits budgetsubtotals in Macera,"Plansee discussions "plaza" products.On changing meatand fuelconsumption, tastechangesin meat tacionesazucareras," 243-255, 256-258. Therewere also discernible and risingsharesof beef. Oddly enough,most sharesof poultry consumption-declining in the nineteenth lard foundits way recordsshow littleporkconsumption century, though intovirtually all cooking. Estadisticahist6rica, industrial y com26. Jose Maria C6rdovay Urrutia, geogrdfica, de Lima (Lima, ercial de los pueblos que se componenlas provinciasdel departamento and passim; the housing 1839), chap. 9, "Riqueza y consumosque hacen los habitantes," p. 131. CompareFuentes,Estadisticageneralde itemis added from imputedurbanrents, Lima (Lima, i858), 705-716and fragmentary surveys in Fuentes,Guia hist6rico-descriptiva, de Lima,"468 (1790s);and Haitin,"Pricesand chap. 4 (i86o); Perez Cant6,"Abastecimiento
| HAHR I FEBRUARY
I PAUL GOOTENBERG
TABLE Item
IV: Lima Consumption Expenditures in 1837

Outlays(1,000pesos) 4,986 1,246 764 623 156 (7,775) 1,639 1,108 983 541 154 574 884 294 218 85 (3,733)
$14,255,000
Percentage 34.9 8.7 5.4 4.3 1.1 54.5 11.5 7.8 6.9 3.8 1.1 4.0 6.2 2.1 1.5 0.6 26.2
100.0
MarketFoods Bread Liquor Tobacco Ice (Totalfood) Clothing(and householdtextiles) Housing(imputedrents) Footwear Furniture Lighting (candles,etc.) Transport (animalcare/carts) Government (taxes) Privateservices(lawyers, scribes) Recreation (gambling, etc.) Health care (doctors' fees) (Totaldiversegoods/services)
Total
Source: Calculatedfrom C6rdovay Urrutia, Estadisticahist6rica de Limna, chap. 9 and p. 131. For comparisons, itemsare aggregated likemodern weights.
The census data in Table IV containthe necessaryglobal expenditure weights:foodstuffs as a whole at 54.5 percent;clothing and home at 1-.5 percent;rentsat 7.8 percent;and diversegoods and sertextiles vices at 26.2 percent.These weights represent generaltrends.They are, in fact,the averagedpost factoconsumption pattern of each and every Limefio.Only one adjustment was necessary to the original data; liquor and tobacco are consideredas essentialfoodstuffs, that the something inhabitants profligate ofLima no doubtfelt at thetime.27 the artiFinally,
the Lima Market," Table I (1814). 1837 censusdata are cross-checked withtradeestimates in Wilsonto Palmerston, "Commercial Report on theTradeofPeruin 1837,"Sept. 29, 1838, FO 61/53. 27. This is a seriousobservation, thoughthe indexwill have to assume (in lieu of archivalprices) thatliquor/tobacco prices movedwiththe complexof otheragrariangoods. Hospital budgetsclearlydemonstrate thatthese "vices"were close substitutes (in budget proportions) to the medicines consumed there.Noris io percent ofincomeexcessiveforthis outlay;modernAndeanpeasants,forexample,allotas muchas 10 to 17 percentofmonetary incomeson coca, drink, and cigarettes. See AdolfoFigueroa,La economiade la sierra del Peru (Lima, 1983),Table 111.4.Conceivably, simpler expenditure weights could have been based on the various1837data alone; but the 1869artisan dietprovedfarmoreprecise,and overallthe differences in the twoapproaches appear minimal.
PRICES
PERU
17
TABLE
Cost ofLivingWeights V: Nineteenth-Century

ofbudget Percentage Item Food (Meat) Mutton Beef Poultry Bread Rice Beans Sugar Lard Noodles Fuel Others Textileclothing Housing etc.) Diverse (services, Total 54.5 (18.7) 6.2 6.2 6.2 11.4 4.4 4.4 2.8 2.7 1.0 5.7 3.5 11.5 7.8 26.2 100.0 ofFood Percentage (34.3) 11.4 11.4 11.4 21.0 8.0 8.0 5.1 4.9 1.8 10.5 6.4 100.0
sobre Datos e informes Sources:Tables III and IV combined.Food: Consejo Provincial, Estadisticahist6ricade Lima, el alza de precios, 117; overallbudget:C6rdovay Urrutia, chap. 9.
are mergedto yieldthe weights san foodweightsand urbanexpenditure index,theone readyforuse in Table V. cost-of-living nineteenth-century derived weights?Apart are these independently How trustworthy ofthe day,comobservations the checksalreadynotedand literary from parisonswithmodernweights(Table II) revealthe expectedtrendsand occursin foodexA striking coincidence intosocialhistory. some insights spent54.5 percentoftheirincomes Limenios penses; nineteenth-century on food,and modernworkers 55.6 percent.The twoleadingitems,meat as halfofall foodconsumption-though, and bread, accountforroughly one would hope, less bread and more meat grace the tables of modern i percentofeach other, workers.Outlayson minorstaplesall fallwithin nutrition. their Engel's law diversified have modestly but recenturbanites in force.28 is modestly
predictsthatas incomesrise theories, 28. Engel's law, the mostbasic ofconsumption goods such "superior" ofbudgetexpenses,discounting food shoulddecline as a proportion these data. from implications socialand welfare one drawslong-term as meat. Reluctantly, incomesspent on of modernworkers' higherproportion Could, forexample,the slightly
| HAHR I FEBRUARY
I PAUL GOOTENBERG
Nineteenth-century consumers allotted11.5 percentoftheirbudgets to textiles,modernones io percent;housingexpensesrose from7.8 to 12.7 percent. Both trendsare predictableduringindustrialization in a burgeoning metropolis like Lima. Even diverseexpensesappear closely matched,though thisconcealssometypical signsofurban"progress," for example,rising transport and healthcosts.And Limefios stilllove, ifwith less abandon,to smokeand drink. Besides verifying the comparability of the new weights,long-term comparisons maysupport an economictruism. Culturalinfluences, or an enduring complexoftastepreferences, are a fundamental determinant in consumption patterns. A Limenio ofthe 1950s, despiteall the changesin the city, wouldhave recognized and sharedthegustosofone ofitsinhabitantsof the century before(morethanthoseof a Japanese,Mexican,or Scottish consumer ofeither era). This stubborn has been noticed tendency by economichistorians ofEnglishpricehistory, studying centuries and it is recognizedin the greater methodological caveatsto cross-cultural than to historical pricecomparisons.29 Thus,itis safeto use thesecoastalcreole weightsin Table V forall ofthenineteenth century. But onlyat greatrisk could we extendthemto the otherPeru oftheIndiansierra. Measuring Inflation An actualpriceindex,builtfrom and budgetweights priceinformation like those above, is stillat best an educated guess at changes in price levels. The statistician can choose to manipulateweightsand data to achieve a lowerbound, upperbound,or realistic of the prices aggregate
foodindicatea deterioration in urbanlifestyles, as proletarianization progressed amongthe independent poor? (It might in the 1957 survey, also reflect faults mentioned above, or the all classesofurbanconsumers, factthatthe 1837 censusreflected notjust workers.) Even the signsof "modernizing" here are ambiguousin welfareterms. consumption Higher expenses on rents,health,and transport could just as well indicategreaterovercrowding,sickness, and time(and money) wastedcommuting to distant jobs from modern These conundrums all long-term class-segregated neighborhoods. afflict studiesofconsumptionand welfare; higher incomeneed notspell higher utility. and SheilaV. Hopkins, 29. E. H. Phelps Brown "SevenCenturies ofthe PricesofConsumables,ComparedwithBuilders'Wage-Rates," Econoinica, 23 (Nov. 1956), 297. See also Est: Changing Consumer in Economic David Felix,"De GustibusDisputandum Preference in EconomicHistory, Growth," Explorations i6 (July 1979),260-296. (Felix'sstudiesofconThirdWorldgrowth have important for Consultbudgetsin sumption implications patterns.) AlbertFishlow,"Comparative theExtent ofthe Market, and AlternaConsumption Patterns, in Micro-Aspects tive DevelopmentStrategies," ofDevelopment, Eliezer B. Ayal,ed. (New York, 1973), esp. Table 3. i. This cultural"truth" on Peruvianconsumption patterns may no longerhold, giventhe rapid"Americanization" (and immiseration) ofLina consumption since the 1960s.
PRICES
PERU
19
mustintegrate task,too, the historian at hand; and in thismathematical evidence. Out ofthe rangeofpossiblecalculations, we now socialhistory a simpleretail construct two distinct price indicesfori8oo to 1873: first, index and moreweighted foodprice index,and second,a moreelaborate trends.Dependingon itsintended use, theoptimal ofgeneralinflationary one. and verisimilar measurewillbe the mostcautious,comparable, aggregate shift The first indexsimply measures theinternally weighted itassumesthatagrarian prices ofinflation, in foodprices.As a conception physiocratic determinedthe price level in general-the not-uncommon ofagriculture. The withthefortunes notionthatall pricesrosein tandem it is not technically a "base starting year(ioo) selectedis 1830,although are an amalgam from theyears1837/69.By 1830, year,"since ourweights wars; theinflationary crisis oftheindependence priceshad stabilized after data and the base yearofotherseriesneedingdeit was a yearofrobust to certaintasksin a subsistence indexis appropriate flators.30 By itself, behindthe bread forexample,understanding the motives social history, Lima. In thiscase, its and bean riotsso commonin nineteenth-century solidset oflocal foodpricesfound. lies in theparticularly strength The calculation is a standard Laspeyresindex.First,the foodexpenagainstthe 1830ditureweights(set at ioo, as in Table V) are multiplied based indices of itemizedprice rises(Table I). To be precise,the index to 1830. So, to is a weightedmeasureof changesin price levels relative an indexednumber of88 (as seen withlardin 1829) represents illustrate, a 12 percentdecrease in price;whenmultiplied by itsweightof4.9, this the index number change of -6o. Alternatively, produces a component a pricerise of9 percentsince 1830, forchickenin 1850 (0og) represents whichafter by 11.4 contributes a scoreof + 103. weighting make the buildingblocks More than fivehundredsuch calculations forthe finalindex. The second step, then,is to add each year'seleven thisnumber revealsthe food itemtotal.When deflated by one hundred, year'saggregate change in price level. (For example,the totalof 962 in higher pricesthan 109.6,or 9.6 percent 1839 = + 9.6 = the indexnumber
it)is Enrique Florescano,Preregard study(at leasthowothers 30. One "physiocratic" cios del rnaizy crisisagricolasen Mexico (1708-1810) (MexicoCity,1969). A majorpurpose pricelevels,in the ofLatinAmerican ofthe presentstudyis to exploreotherdeterminants regions. "Westernized" central politically would have had to have come weights To be a technical"base year,"the expenditure in historical pricestudies(see Phelps are common weights 1830,too. Broad(orshifting) from thenavoidscertain ofPrices"),so longas thehistorian "SevenCenturies Brownand Hopkins, questionis the choice of 1830 forbase-yearprices; yet, problems.A trickier index-linking the results.On bothissues, instead(suchas 1830-34)barelyaffects usinga broaderinterval (London, for Historians Methods to Quantitative consultRoderickFloud, An Introduction
1979), 122-129.
| HAHR I FEBRUARY
I PAUL GOOTENBERG
TABLE
VI: RetailFood Price Index,Lima, 1800-73 (1830 = 100)

Index 123.8 121.1 115.8 111.9 (105.1)a 121.4 (189.2)a 169.3 (201.2)a 116.0 109.4 105.3 99.6 100.0 97.9 94.9 104.9 100.2 98.6 (104.6) 109.1 110.0 109.6 92.8 91.9 91.5 (88.3) (88.3)
-
Year 1800 1805 1810 1815 1820 1822 1826 1827 1828 1829 1830 1831 1832 1833 1834 1835 1836 1837 1838 1839 1840 1841 1842 1843 1844
1845
Further weighted 113.0 108.6 111.7
Year 1847 1848 1849 1850 1851 1852 1853 1854 1855 1856 1857 1858 1859 1860 1861 1862 1863 1864 1865 1866 1867 1868 1869 1870 1871
1872
Index 93.7 88.5 90.6 89.4 92.5 94.2 91.6 89.1 99.0 121.5 (118.6) (119.9) 109.4 147.4 129.3 124.6 117.9 124.6 141.3 153.5 (156.4) (156.0) 152.9 (152.9) 150.1 (149.5)
149.5
Further weighted 96.6 94.2
100.0
125.8
96.1
128.8 127.0
1846
1873
weighted Sources:Tables I and ILL.Calculations with1869 foodweights= 100; further indexx.545 + 45.5; ( ) are interpolations. a Factoring in warwheataverages(1815-22).
in 1830.) Along the way,we can prudently resolvethe last gaps in the Lima's retailfoodprice index The result,in Table VI, is metropolitan i8oo this is measureof to Recall that our most from promiscuous 1873. all that assumes that reflect the volatile one bedeflation/inflation, prices is Yet it still accurate than of more havior foodstuffs. impressions gathered forit is weighted,and these weights fromindividualfood fluctuations, items. includebread and otherprice-stable a late colonialdeflationary trend(lo perThe foodindexdemonstrates hike a peaking in cent), interrupted by 51 percentindependence-war
seriesmakesthe difference here. 31. See n. 18 above; thecompleteflour
series.31
PRICES
PERU
21
crests.By the mid-1840s, 1830s,despitetwocaudillo-war aggregate food prices had descended io to 12 percentbelow 1830 levels, or more than sincethestart one-fourth (28.7 percent) ofthecentury. As earlyas 1849,a fitful guano-ageinflation began. Food pricesrose6 percent between1848 and 1853, followedby significant spurtsin 1854-56 (36 percent),18596o (35 percent),and 1863-66(33 percent).Overallin thehighguanoage, feltin the pocketsof foodpriceshad doubled.32 By contemporary norms, workers, thiswas a startling inflation. Of course,foodstuffs werenotthesole expensefor A more consumers. cautiousapproachwouldfurther thisfoodindexin theoverallconweight sumptionbasket,assumingthatotherprices (forclothing, forexample) remainedstable.This is also shown,at intervals, in Table VI. (Calculation is simple: the food price indexis deflated by its proportion in budgets, .545 x the foodindex;foreach year .455 x loo is added, whichhas the effect of holdingall otherpricesconstant.) Even ifconservative, the asin othergoodsis notunfounded, sumption ofpricestability giventheera's on tradables; norwas iteverrealistic to assumethat, downward pressures in a city,prices reflected agrarian conditions alone. When weightedthis half as strong. Pricesfellonlyii way,all pricemovements appearroughly from1830 to 1873 was percentfromi8oo to 1830,and the totalinflation only27 percent. On the otherhand, an annualfood price index is not alwayssensitive to the wild fluctuations thatcould occurin moments of crisis. Durforexample,blockades,hoarding,and ing the independencestruggles, spikingspread panic among Lima's vulnerable population.To illustrate, we can use a bakeryprice seriesunearthed forthe war by one historian whichbulkwheatpricesswungbetween3.5 and 25 years1812-21 (during thatfoodprices may intoour index,thissuggests pesos!). When factored have doubled at the height ofshortages.33 The second majorindexto calculateis a measureofgeneralinflation. the impactof falling In this, we integrate prices of importedmanufacguano-agefood index of these results, recallthatHunt'ssimpler 32. For comparisons and Guano,"75); thisis close to in theperiod 1855-69("Growth 32 percentinflation reports method.Quiroz specifies(by myestimate,especiallyifHuntwas usingthe mostweighted twopeak subsistence crises,in 185oand 1856(La deuda defraudada,lio-iii); comparisons) Table 37, for azucareras," here. See Macera,"Plantaciones appearssignificant onlythelatter price changes. whollyunweighted T. S. Melzer,"The Rise in the Price John based on datafrom calculations 33. Weighted in the Cityof Lima 1812-1821," of Wheat forthe 'Bakeryin the Streetofthe Fishmarket' Historians Journal,15 (Spring1988), Table 3. This articleis a revealing The Accounting crisisoftheera, and ofthe Lima breadsector.Recall thatour bread accountofa subsistence ones. prices,and, fortheseearlyyears,international seriesis based on flour
witha continuing 1822. A rapid stabilization followed, deflation in the
22
| HAHR I FEBRUARY
I PAUL GOOTENBERG
of inflationary behavior tures,risingurbanrents,and the overalleffects This index assumesthatall prices shifted togetherand expectations. and imported textiles, as a weightedaverageof the pricesoffoodstuffs, rents.The mostrealistic and warranted modelofpricesin Peru'sopening by consumers, workers, and economy, it is the one mostlikelyfollowed withmanydescriptions and it is congruent ofthe age. As entrepreneurs, in 1869, "everything has gone up the merchant J. F. Lembecke testified in proportion-wages,crafts, salaries,rents....34 in Table VII. By 1830, and rents are found Separateindicesfortextiles textiles had flooded sheltered PeruvianmarNorthAtlantic traditionally were perceptibleas far contraband) kets,althoughtheireffects (through textiles cheap industrial cottons, back as the eighteenth century. Chiefly import bill (70 to go perremainedthe bulkofPeru'snineteenth-century the clothing cent by some accounts);by 1840, theydominated sectorin in all partsofthe country.35 Lima, and theyset thepriceofcloth virtually In a sense, cottonsserve as proxyforall foreign manufactures, though withthe Englishindustrial theirpricesare the ones thatfellmostsharply It shouldbe keptin mindthatthe initial expenditure weight revolution. was 11.5 percent.36 forclothing and hometextiles twodistinct sources,forgreater The textile indexis constructed from realism.For i8oo to 1830, I have used pricesofU. S. sheetcottons.Until were actually the majorsuppliers of "tocu1830, New England shippers ofwhat Peruvians yos" to Peru. These pricesare also the best indication interrupted by internawould have experienced at thefarend ofa market and initial colonialism tionalwarsand variousobstacles to trade,including republican tariffs. The index,likeothersources,revealsan unstabletrend
34. Most notably, the long accountsin Consejo Provincial, Datos e informes sobre el alza de precios (quote, 13); or Martinet, Carestia de viveres,zo. Lembecke was wrong as urbanwages,at least,did notkeep up withinflation; insofar see discussion below. 35. Heraclio Bonilla,"La expansi6n comercial britanica en el Peru,"Revistadel Museo Nacional (Lima), 15 (1974),253-275, esp. Table 3; fortheconsumption on the openeffects and Merchants," ing economy, see Gootenberg, "Artisans chaps. 1 and 5. A detailedsurvey foranalyzing growing import consumption (1845-49) is the appendixto Consejo de Estado, del Reglamento de Comercioy variosotrosdocumentos "Proyectode reforma que con 61 tienenrelaci6n," El Rejistro Oficial,Aug. 12, 1850. data (Table IV) also implicitly 36. The original expenditure contain weights for domestic manufactured goods (artisanal furniture, candles, shoes),whose combinedweightin 1837 was 11.8 percent,about equal to the import bill. For lack of price data not muchelse can be done here. The share of home manufactures, and theiruse of importedinputs,also shifted the century. relative significantly during By the late 185os,thissectorwas declining to importedcrafts; an incipient yet, by the inid-1870s, substitution import emerged. See "Artisans and Merchants," Gootenberg, chaps. 2, 5. This index mustassume, then,thatdomesticmanufactures prices followedthe price level in general.These are a fewoftheproblems thatmakeanydetailedanalysis oftradables/ nontradables pricesso difficult.
PRICES TABLE
PERU
23
VII: Textileand RentIndices

Year 1836 1837 1838 1839 1840 1841 1842 1843 1844 1845 1846 1847 1848 1849 1850 1851 1852 1853 1854 Year 1864 1865 1866 1867 1868 1869 1870 1871 1872 1873 236.9 258.2 281.4 306.7 334.3 364.4 396.8 432.5 471.4 513.8 84.9 75.5 71.0 70.5 65.0 62.9 55.2 52.0 53.0 52.0 49.3 54.2 45.1 44.2 47.6 45.0 44.8 47.2 43.7 Year 1855 1856 1857 1858 1859 1860 1861 1862 1863 1864 1865 1866 1867 1868 1869 1870 1871 1872 1873 42.5 44.1 45.8 43.4 45.4 45.8 44.4 53.4 69.3 78.9 70.1 70.7 59.1 53.1 54.9 51.2 49.0 52.1 50.7
Imported Textiles(1830 = 100) Year 1800 1804-1805 1809-10 1814-15 1819-20 1822-23 1824 1825 1826 1827 1828 1829 1830 1831 1832 1833 1834 1835 169.7 197.6 228.3 208.4 158.7 139.1 95.7 102.7 97.1 89.6 87.8 92.2 100.0 90.8 78.6 79.0 80.1 85.7
Rents(1854 = 100) Year 1854 1855 1856 1857 1858 1859 1860 1861 1862 1863 100.0 109.0 118.8 129.5 141.2 153.9 167.8 182.9 199.4 217.3
Sources: Textiles:(1800-30), HistoricalStatistics of the UnitedStates,Series E 123Historical Prices19,cotton British piece 134; cotton sheeting (1830-73), Mitchell, Statistics, 761. exports, from Datos annualincrease Rents:(1854-73) calculatedas 9 percent Consejo Provincial, e informes sobre el alza de precios,"Cuesti6nhabitaci6n" prediosurbanostax (crosscheck: data).
the 1820S27 After to 1820, followed by a 6o percentdropin pricesduring the market, I use British FOB 1830, when the Englishcame to dominate
of the UnitedStates,Series E, 123-134. These price 37. Based on HistoricalStatistics to on Trade,"Ricketts in twodetailedBritish "Reports trendsare in line withthosereported Canning,Dec. 27, 18z6, FO 61/8,and Wilsonto Canning,Jan. 19, 1834, FO 61/26.They
24
| HAHR I FEBRUARY
I PAUL GOOTENBERG
the delayed but fullimpact prices of exportcottons.These underscore and transport revolutions of the industrial on Peru's opening economy, tariffs. with its progressively falling By the 1840s and '50s, clothprices had declined another50 percentsince 1830-a considerable savingsfor consumers-but theydid riseagainin the i86os withthe "cotton famine" and otherinflationary pressures oftheera.38 Housingpricesalso varieddramatically in the nineteenth century. In fact,by the 1870s, renthikesbecamea matter ofgraveofficial and popular concern,on a parwith foodissues.After actually receding during thepostindependencedepression,Lima's population explodedduringthe guano in the i850S. The citydoubled in age, largelythrough internal migration sizefrom about55,ooo to 120,000 by the1870s,andrents soared accordingly.39 Anotherinfluence was the concentration of Peru's plutocracy in the capital,wherethe newlyrichfrenetically bid up housingprices. Our best estimateofhousingpricescomesfrom the 1869 price commission.Averagerentincreaseswere placed at 8 to io percentannually between i855 and 1869 (shoprentsinflated even faster at a 12 to 15 percent rate). If thisseems outrageously high,urbanreal estatetaxes(those evidence:theirsum tripledfrom on predios urbanos)lend corroborating i850 to 1870, and thendoubledin theearly187os.40In Table VII, an index at 9 percentis calculatedwithbase year 1854. Boththe indexand the tax data suggesta quadrupling of rentsby 1873. Such a wrenching relative render therent price changemight weight (7.8 percent ofbudgets)rather since it reflected in 1837. At the same time,this conditions conservative,
realistically differ from the earlysharpindustrial price cuts reported in AlbertH. Imlah, EconomicElements in thePax Britannica: Studiesin British ForeignTradein theNineteenth Century (Cambridge,1958),chap. z and App. Table z. 1821-1965," 38. "AverageValue of CottonPiece Goods Exported-United Kinlgdom B. R. Mitchell,BritishHistoricalStatistics (Cambridge,1988), Prices 19, in 761 (original source: T. Ellison, The CottonTrade of Great Britain,London, 1886). These trendsalso moderntextilefactoexplainwhyPeru's last obrajes fellby the early 1840s,and the first ries succeeded in the 186os. A modestbias mightresultfrom use of these series, if rates a locallyderived of change differed substantially betweenFOB and CIF prices;obviously, clothserieswouldbe preferable. 39. C6rdova y Urrutia,Estadistica hist6ricade Limna, 19, 33-35; Fuentes, Lima: Apuntes hist6ricos, descriptivos, estadisticos y de costumnbres (Lima, 1925; orig., 1866), which it (11-12) placed great stresson populationgrowth, lo-ii. The 1869 commission at "140-150,000."See Miller,"Population Problemin estimated(well above censusfigures) Lima," forappraisals. 40. Basadre, Historiade la Republica,IV, 1763 (from Datos e informes sobre el alza The prediosdata studiedare from de precios, "Cuesti6nhabitaci6n"). Hunt, "Growthand Table 4. The best figures (in Guano," 120 and Tantalean, Politica econ6onico-financiera, pesos to 186o, thereafter soles) are 45,000, 1837;42,000, 1850;68,ooo, 186o; 72,000, 1864; collection.Hunt uses these by stricter 96,ooo, 1871; and 192,000, 1874-the last distorted but his earlier1850sdata seem shaky. data foran 1866/76 pricedeflator (ioo percent),
PRICES
PERU
25
can implicitly housinginflation capturechangesacrossa widerrange of domesticservices. Before1855, to be sure,housing pricesmovedalongwithotherprices in the regionaleconomy. Theywere stationary or falling until1845, with the economicrecessionand population loss in Lima. This trendis clear from the tax recordsand from declining area farm rents.Rentslikelyrebounded modestly withthe demographic and businessrevivalbetween 1845 and i855, muchlike otherprices,beforeskyrocketing thereafter.4' The wayto represent thispattern is simply to omithousing from theindex until1855. The generalinflation indexin Table VIII thuscombinestwo calculations. It is a linkedindex. First,fori8oo to 1854, the original food and become ioo, or thetotalchangein prices(54.5 + 11.5 = clothing weights 66 is recastas ioo = 82.6 + 17.4). The two reweighted seriesare then summedforeach year.Second,for1855 to 1873,the multipliers forfood, clothing,and housingbecome, in similarfashion, 73.8, 15.6, and io.6 and the threecomponents are added forthoseyears. Both respectively, calculations assumethatall prices(eventhoseomitted) behavedin tandem withthe largeportion ofpricesaccountedforin theweights. The indices linkin 1854-55. Linkingthese two distinctly weightedindices is sound, with their it is methodologiminimaldivergencein the years 1854-55. Moreover, cally desirable. For in thisway we actuallydo capturepartof the longtermrelative shifted pricechangethatmusthaveensuedwhenconsumers theirmidcentury savingsfrom cheapertextiles intotheirhigher rents. Table VIII also contains a specific guano-ageindex,intendedforstatisticalwork on the post-i8so exportera. The model and weightsare identicalto the second set in the generalinflation index,whichwas multhan 1830, "1oo." In 1854 prices tipliedby 1.202 to make 1854, rather moreor less stationary began theirascent,after behaviorduringthe initialdecade ofthe guanoage. This indexgraphically isolatestheguano-age decade after1854, change in price levels: 30 to 6o percentby the first and 70 to ioo percentoverallby the following decade.42 If it was a dramaticshift, the explanation lies mainly in the mid-185os in meat, trough and textileprices. Consumers lostthesebenefits flour, altogether by the
Table 4 (for1830s-1840spredios data); 41. Tantalean, Politica econ6onico-financiera, oftheurbanrenttakeoff Expansion," chap. 1. The timing Engelsen,"AspectsofAgricultural de Lima," El Correo de Lima, Oct. 16, 1851 and is also seen in "Estado de los artesanos Dec. 30, 1858. In the earlyguano age, many "A la Representaci6n Nacional,"El Comnercio, "Artisans and Merchants," Table 7. Gootenberg, indicators rosein tandemwithinflation: of1855-69inflation at 75 percent(excluding 42. Again,recallHunt'sestimate bread)nearlythe same figure as mymoredetailedone.
26 TABLE
j HAHR
VIII: Inflation Indices
1830 = 100 131.8a 135.2 135.4 128.7 127.9 164.0 112.7 105.9 102.3 98.3 100.0 96.7 92.1 100.4 96.7 96.4 101.2 103.3 103.2 102.8 88.0 86.9 82.0 80.6 82.2 (82.0) (81.5)
I FEBRUARY I PAUL GOOTENBERG
Year
1800 1805 1810 1815 1820 1822 1826 1827 1828 1829 1830 1831 1832 1833 1834 1835 1836 1837 1838 1839 1840 1841 1842 1843 1844 1845 1846
Year
1847 1848 1849 1850 1851 1852 1853 1854 1855 1856 1857 1858 1859 1860 1861 1862 1863 1864 1865 1866 1867 1868 1869 1870 1871 1872 1873
1830 = 100 86.8 80.9 82.5 82.1 84.2 85.6 83.9 81.2 90.2b 109.1 108.4 (110.2) 104.1 134.2 121.7 121.4 120.9 129.4 142.6 154.1 157.2 (158.8) 160.0 162.9 164.3 168.4 172.7
1854 = 100
Guano age
lOG OC 109.6 131.1 130.3 132.5 125.1 161.3 146.3 145.9 145.3 155.5 171.4 185.2 189.0 190.9 192.3 195.8 197.5 202.4 207.6
Sources:Tables I, V, VI, VII. Method: See text.( ) are interpolations. 1830 = 100 weights: a 1800-55, Table VI foodindexx.826 + Table VII textile indexx.174. b 1855-73, foodindexx.738 + textile indexx.156 + rentindexx.106; 1855 is mean. 1854 = 100 weights: C1854-73, same as b; indexis 1.202 X 1830 index.
i86os. But thatis preciselyhow inflation musthave felt-alarming-to the generation the guanoage. livingthrough Of all the indices, the long-range 1830 measureof generalinflation is the mostcautious,comprehensive, and solidlygrounded.It realistic, in my opinion,the optimalcost-of-living and can represents, indicator, Peruvianprice levels had also be used as a statistical price deflator.43
ofdoofthisindexliesin itsattempt to capturethe effects thestrength 43. Specifically, ofthe foodprice indexlies the relative strength mesticand tradedgoods beyondfoodstuffs; meaofthe indexwould involveindirect in its fuller local data base. A valuablecrosscheck exchange ofamassing correct thechallenges suresbased on exchangerates,notwithstanding ratedata (see n. 22).
PRICES
170
PERU
27
160
KEY:
150 Food Price Index
General Inflation Index

140
130
Pi
120
115 110
b ~~~~~~~~~~~~
,'I
a
I
105\
100/
1810
1820
1825
8e
'
85
1 40
1845
1850
1860
1865
1870
95 90\ 85
80
FIGURE 1: Price Levels in Peru, 1800-73 (1930 = ioo)
Price levels were dropclearlymarkedstagesin the nineteenth century. in the finaldecades of colonialrule, even ifinterrupted by ping slightly wars.Two decades ofdeflation the inflationary spiralofthe independence out at 12 to iS percentbelow 1830 levels, as the followed,bottoming which construck, guano age began. In the mid-p850s. rapid inflation of the export tinued (withsharpfluctuations) the remainder throughout era. By 1873, the price level stood 73 percenthigherthan 1830, or 32 price percentabove colonialnorms.Beyondthatpoint,Peru's mercurial remains to be explored. history ard Origins Periodization and limitsof these data and methodsshould By now, the strength be readilyapparent.Price seriesremainever open to additions and imand than but these numbers do offer more precision meaning provements, which the the i, of the qualitative portrays past. Through Figure guesses follow readers food price index and the inflation index, may changing a new periodization Lima price levels fromi8oo to 1873. This supports of price history-and may also help sortout possiblefactors behind the movements ofprice.
28
| HAHR
I FEBRUARY I PAUL GOOTENBERG
looks prices,thenew periodization ofaggregate Fromtheperspective like thefollowing: or productivity, Possiblegainsin agrarian i) 1800-14: Moderate Deflation. were alreadyat workon the ancien commercial practices, more efficient and theBourbonshipping to thesethindata. However, regime, according as Perucould muchofthedownward effect, crisesoftheera offset political industrial revolution. fromthe price fallsof the infant not fullybenefit surmised from unweighted withinflation This incipient deflation contrasts pricesin late viceregalCuzco, series,or as seen in agrarian agricultural Bolivia,and Mexico.44 The supplydisruptions ofthe indepen2) 1815-24: Sharp War Inflation. exactions are notorious-theblockades,urbanshortages, dence struggles ofvalleys suchas Chancayand Mantaro, ofmarauding armies,devastation theypushed up prices nearly40 percent the flight of slaves. Together, food shortages alone by 1822. This remainsa timidestimate;transitory to declare "freetrade" The pressures may have shot prices up twofold. influences are harderto dein 1821thusbecome even clearer.Monetary of 1822-23 were likely emissions unbackedfiscal cipher,forSan Martin's moneysupply.This losses ofmetallic counteredby the era's deflationary reached some 27 millionpesos between 1819 and flight capital-bullion pricesofimported 1825. Relativepricechangesare also hardto pinpoint: manufactures after1821, just as thoseof domesticfoodstuffs plummeted theimport until crisis "oversupply" soared. But theimpact appearserratic ofthe mid-i820s.45 and Deflation. Pricelevelsstabilized remarkably 3) z825-46: Stabilization theirslide untilthe of independence,continuing well in the aftermath thistrend.Indeed, once peaks alone disrupt mid-i840s.Two caudillo-war crises(1815-24, 1833, and 1836allowanceis made forall threemilitary is visible ever since i8oo. Prices movement 39), a secular deflationary has notbeen recogThis deflation were sinking about i percentannually. ruralestates. nized before,exceptin the slumpafflicting accountforthe i8 percentdeflation from Severalsupplyfactors likely both do1826). The pricefallsinvolved 1830 to 1846 (or 27 percentfrom
agra44. Haitin,"Pricesand the Lima Market," App. ii; Glave and Remy, Estructura "The Limitsof Colonial Absolutism: ria: Ollantaytambo, Table XI-L; JohnH. Coatsworth, The State in Colonial Mexico,"in Essays in thePolitical, Economic,and Social Historyof Colonial Latin America,Karen Spalding,ed. (Newark,DE, 1982), 40, 46; BrookeLarson, Colonialismand AgrarianTransformation in Bolivia:Cochabamba, z550-1goo (Princeton, pricetrends. 1988), App. Table A-5. All these,ofcourse,are agrarian 45. Timothy E. Anna, "Economic Causes of San Martin'sFailure in Lima," HAHR, The best look at 182os price changesis Rick54:4 (Nov. 1974), 657-681 (on paper money). ofPeru,"Dec. 19, 1826, FO 6i/8-which estimates 50 ettsto Canning,"On theCommerce percentimport pricecutssince 1821 "freetrade," and calculates bullionexports.
PRICES
PERU
29
mesticfoodstuffs and tradables.Until 1845, political-military instability keptPeru in deep economicrecession, yetestates wereable to quickly rewas a depressedone. Mostcoastal constitute. However,theironlymarket farmers survived by switching from Pacific exports (sugar, tobacco)to provisionsforlocal consumers, at a timeof shrinking townpopulations and demand. On the tradablesside, textileprices took theirsharpest-ever plunge in thisperiod (morethan50 percent).This timeconsumers perceived the savings,as theycombined withAtlantic shipping advancesand the dismantling ofPeruviantariffs (completed in textiles by 1840).46 Local and international were also at play. Peru's monetary factors chronicbalance-of-payments gaps ofthe period-resolved by continuing exportsof coin-may have permitted these downwardmacroeconomic price adjustments. By the 1840s,the revival of silvermining and the diversification of exportswould have halted this effect. In any case, the impetusto deflation in Peru musthave been formidable. Most contemhad predictedinflationary poraryanalysts,in contrast, pressuresfrom currency debasement(the influx from mid-1830s onwardof"feeble"Bolivian coin), or had envisionedelevated food prices fromthe era's stiff agrarian protectionism.47 4) 1846-54: ModerateGuano Reflation. By the mid-185os, prices were to wobbleup toward beginning 1830 levels.The notablefinding, however, is thattheearlyexpansionary effects ofsocialpeace and guanoexports did While urbanpopulation, not translate rapidlyintoan inflation. business, and demand reboundedquicklyin the late 1840s, thisdid not, forexample, spawnsupplybottlenecks. Domesticfoodpricesdid notleap until the laborcrisisofthe 1854-55civilwar. does indicatespreadingdomesticdemand felt Overall, this reflation fromguano exports-contrary to enclave modelsof the bonanza, which in the domestic incomeeffects argue thatthe export producednegligible Latentinflationary economy.48 pressures mayhave been developing;yet
46. For agrarianissues, see Engelsen, "Aspectsof Agricultural Expansion,"chap. 2; Burga's series fornineteenth-century tithesmightsupportthis analysis.Most analysesof imports to theearlyrepublics (e.g., D. C. M. Platt,LatinAmerica and British Trade, 18o6the dramatic 1914 [New York,1973], part i) overlook impactof real price changes. Even witha stagnant import bill (likePeru'suntilthelate 1840s), theactualamount(realvalue) of these manufactures, had doubled. giventheir pricefalls, and agrarian see Gootenberg, BetweenSilver 47. On monetary adjustments protection, Peru (Princeton, and Guano: Commercial Policyand the Statein Postindependence 1989), chap. 3 and on mining,see Deustua, Mineriaperuana. The debates over debasementare vast: see, e.g., E. M., La monedaen el Perut(Lima, 1859). This and othersourcesactually predictedinflations of20 to 25 percentstarting in the 1830s. TheirPattern in Historical ofDevelopment 48. Jonathan Levin, TheExportEconomies: Perspective (Cambridge,1960), chap. 2, "Peru in the GuanoAge." Huntalreadyarguesthis in "Growth and Guano,"85. pointabout inflation
30
| HAHR I FEBRUARY
I PAUL GOOTENBERG
theywere contained by the continuing descentofimport prices(in wage goods like grainsand textiles), whichwas readilyabsorbedafterPeru's Manchesterian free-trade law of 1852. Quiroz has specifically analyzedmonetary factors in thisperiod. He rejectsthe contemporary polemicthatthe massiveinternal debt consolidation of these years (nearly24 millionpesos by 1853) fueledinflation; the disbursedpublicdebt bondsdid notfunction as a "quasi-money." The timing and degree of inflation shownhere fully support thatargument.49 However,one should not discountexcess demandas a distinct resultof thisredistribution, even ifpartof the spendingleaked abroad by way of luxury imports. 5) 1855-73: SevereGuano-Age Inflation. Pricelevelsroseprecipitously in the matureguanoage: some 70 percentby 1865,and io8 percentoverall by 1873. As contemporaries noted,the civilwar of 1854-55 markedthe startof acute inflation; sharpfluctuations also struck in 1859-60 (during a majorexportcrisis)and in 1864-66 (during the costlywar withSpain). By the mid-i86os,however, theseeventsclearly formed partofa secular inflation. The years 1854-56 representa conjunctural crisis in food supply (whosepricesrose 36 percent) whichled to emergency decrees fordutyfreefoodimports in i855, 1857,and 1859. Butfreer tradecould notabate an encompassing inflation, now felton everyfront-in domestic housing costsand, ifless dramatically, in consumer tradables (textiles, and grains) domestic agriculture. By the 1870s,thispattern ofinflation had completed Peru's long-term shift in relativeprices, the one first glimpsedin the 182oS: a cheaper tradablessectorwas edgingout domesticproduction. The causes of inflation musthave been the broadestones, such as the rapidloan-financed ofthe state;thedramatic growth of Lima's expansion of local banksissuingunbackedpaper population;and the proliferation notes. Since, by the i86os, inflation had become an overtly politicaland popularcontroversy, arose to explainit. For the outhomespuntheories breakof the crisisinr discussshort-term 1854-56, historians stresses:the dislocations ofwar,theimpact ofslavemanumission on coastalagriculture, and, withleast evidence,the effects ofAndeanepidemics.The 1869 re1850S inflation theories, likethosereported wholesalein Macera,"Plantaciones azucareras," 235-265. Specifically, bond emissions Quiroz rightly of 1850-52 did arguesthatthemassive notcoincidewithinflation and that, whenbondreleaseswereparalyzed in 1855-57, inflation
49. Quiroz, La deuda defraudada,113-119, foran informative and incisivereviewof
became rampant.Using specific productcomparisons, Quiroz also cogently specifiesslave manumission as the moreprobablespurto inflation. For a graphic accountof the 1854-55 supplycrisis,see Miles to Clay,"Reporton Trade,"Sept. 30, i856, M 155/3.
PRICES
PERU
31
a chronic gionalpricecommission,50 by thenexamining problem, spokeof coin depreciation (theimpactofmonetary conversions in 1857 and 1863); the 1864-65 conflict (more clearlyreflected by this index); the general and persisting "expansion" of Lima (i.e., demandfactors); agrarian labor On weakergrounds, shortages. contemporaries and historians alike fault the transformation farms ofnearby intoexport-oriented cottonand sugar plantations, without considering theprobable efficiency gainsofincreasing foodimports.5' and wagesexhibited Demography, supplyconditions, peculiarand revealingpatterns duringthisperiod: perhapsa structural basis forurban inflation. The 1850s influx of ruraland foreign migrants to Lima (that doubled urbanpopulation) spurredhousinginflation, as did the concenin the capital. For the first tration of Peru's emerging plutocracy time, urbanization also strained local foodsupplysheds,as seen, forexample, in the surgein meatpricesand fuelprices(from sheerdeforestation). All thewhile, Peru'sintensifying rurallaborshortage helped maintain higher is whythisinflationary food prices. The mystery social pattern persisted formore thantwo decades. Falling(real) urbanwages and risingcoastal agricultural wages shouldhave reversedsuch demographic pressureson foodand housingsupplies.52 ifnotallowed by expansioncould not have flourished Still,inflation had occurred ary monetary conditions-justas Peru'spreviousdeflation The post-i86ogrowth in Peruvian amid a shrinking money supply. money and multiplication ofa Lima banksupplywas caused by the suddenbirth ing network (linkedto theguanotrade)and bytheinflux offoreign credit ofthestate).In the 1870salone,fiscal notesincreased (linkedto expansion The abundanceof exchangewas reflected in the rapid fallin fourfold.53
in 1869;our indexreveals was evenformed 50. An apt questionis whythecommission The initial theprecedingthreeyearsas an interval ofmildinflation. statedconcernwas meat had now become a chronicproblem(evidentwhen price prices, thoughbroaderinflation levelsdid notfallback after the Spanishwar).Aboveall one suspectspolitics: theemergence of the Pardistareform to exploit See faction-civilismo-hoping popularurbandiscontent. en la historia: Margarita Giesecke,Masas urbanas y rebeli6n Golpe de estado,Limna, 1872 (Lima, 1978),chaps. 2, 4. 51. Consejo Provincial, Datos e informes sobre el alza de precios,passim; Martinet, Carestia de viveres;Macera,"Plantaciones azucareras," 235-265. Macera'sAndeanepidemic advancesreported theoryseems implausible, giventhe population by the 1862 census; in Ultimate thoseregions. blameplaced on transforanycase, fewsuppliescame to Lima from mationsto exportagriculture belongsto an old, and seemingly eternal,polemic:see, e.g., en el Peru de los "Los enclavesde exportaci6n alimenticia HenryK. Slajfer, y la agricultura de la tesisde R. Thorpy G. Bertram," anios1890-1920: A prop6sito Hist6rica, 4 (Dec. 1980),
243-254.
52. These issuesare discussedunder"Social Analysis." 53. Carlos CamprubiAlcazar,Historiade los bancos en el Peru (186o-1879) (Limna,
32
| HAHR
I FEBRUARY I PAUL
GOOTENBERG
interest rates,approaching negative real rates,even as inflation ragedon. Moreover,untilthe mid-i870sexportcrisis,none of these expansionary forceswere constrained by demand-soaking toolssuch as monetary controls,devaluation, taxation, or recession. 6) 1874-1885: Inflationary Chaos ... to Liberal Control?Direct data on pricesare lacking forthelastquarter ofthe nineteenth century, but other escalatedduring thecrisis-ridden evidencesuggests sometrends. Inflation late 1870s, accordingto exchangerate analysisand contemporary acseemsprobable,even ifattenuated counts.A monetary inflation by silverin 1872) and the economy's standarddepreciation (starting export-credit collapseof1875. Intensemonetary instability accompanied thePacific War and itsaftermath (1879-85);pricelevelsmayhave risen8oo percent.54 By the 189os, however,prices had stabilized,and Peru's modern recordbegins. Policymakersmayalso have absorbedat least one painfullesson from the nineteenth century; untilthe presentnightmares, an orthodox liberalPeru managedto contain better thanmostcouninflation triesofthe region.55 Even new price data are unlikely to alterthese broad stagesof price movements, exceptforthe 1870s. But understanding the causes and imis likely pact ofinflation to advancewell beyondthisunavoidably sketchy and eclecticanalysis. and Analysis Applications and common sense all dictatethe cautious Sparse data, price theory, use ofa historical based on the ofdeflators, price series.Table IX consists inflation statistical work.What, then,are some index,foruse in further ofthe pressing ofpricedata to theeconomic,social, practical applications ofthe Peruvian "darkages"? political,and regional history Pricemovements can helpilluminate domesi) Economic Analysis. murky tic economicdevelopments of independence. duringPeru's first century are glimpsed external indicaUsually,these developments onlythrough Caution is needed in such analyses, tors, such as exportperformance.
et al.) may clarify monetary history (Quiroz; Hiinefeldt New workon nineteenth-century these issues. inPoliciesin Peru,"chap. 3, for1879-85. Hunt,forGNP deflators, 54. Boloiia,"Tariff and betweenl i866 and 1876("Growth taxrecords) at ioo percent putsinflation directly (from carestia" (La Patria,Mar.7, 1873)wouldcorroborate Guano," 121). Clues suchas "Creciente in Carestiade viveres, denies it. 21, flatly inflation; Martinet, continuing rnid-i870s the severe 187oS-188osinflation Peru. The queryis whether 55. Thorp and Bertram, whentheyoptedforan "orthodox" liberalredirectly affected the outlookofpolicymakers exportexperienceof the passingcentury construction of Peru in the 189os; the disastrous have convincedthemotherwise. might
1957). For a discussion of interest rates, see Macera, "Plantaciones azucareras," 129-150.
PRICES
PERU
33
TABLE Year
1800 1805 1810 1815 1820 1822 1826 1827 1828 1829 1830 1831 1832 1833 1834 1835 1836 1837 1838 1839 1840 1841 1842 1843 1844 1845 1846
IX: Deflators
1830 = 1.000 1.318 1.352 1.354 1.287 1.279 1.640 1.127 1.059 1.023 .983 1.000 .967 .921 1.004 .967 .964 1.012 1.033 1.032 1.028 .880 .869 .820 .806 .822 .820 .815
Year
1847 1848 1849 1850 1851 1852 1853 1854 1855 1856 1857 1858 1859 1860 1861 1862 1863 1864 1865 1866 1867 1868 1869 1870 1871 1872 1873
1830 = 1.000 .868 .809 .825 .821 .842 .856 .839 .812 .902 1.091 1.084 1.102 1.041 1.342 1.217 1.214 1.209 1.294 1.426 1.541 1.572 1.588 1.600 1.629 1.643 1.684 1.727
1854 = 1.000
1.000 1.096 1.311 1.303 1.325 1.251 1.613 1.463 1.459 1.453 1.555 1.714 1.852 1.890 1.909 1.923 1.958 1.975 2.024 2.076
Source: Table VIII indices. indexor statistic byannualdeflator. Note: To deflate, dividenominal
either prices could reflect however,since, to take one example,falling changes. productivity economiccontraction or growth-enhancing signofthecaudillois another For the 1825-45period,Peru'sdeflation its sources. For exera depression,and prices can help us understand operflow mechanism price/specie ample,how well was the international to classical According economy? ating in Peru's riskyand disarticulated Peru'sdomestic shouldhaveleveledin responseto pricestructure theory, local money exports-i.e., a decreasing earlytradegaps and bullion-coin shouldhave become dearerrelativeto home supply.Tradables(imports) ofthe nascentLatin American goods, endingthistypicaldisequilibrium republics. But, did the modest domesticprice declines actuallyobserved (no an efficient local adjustment or inefficient morethani2 percent) represent prices(morethan50 percentin foreign process?Relativeto plummeting
34
| HAHR I FEBRUARY
I PAUL GOOTENBERG
response,caused by the i820s-30s), theyappear to have lagged.A faulty Peru's wouldhave prolonged or socialfactors, anynumber ofinstitutional ofadjustments contractions instead quantity/output depression, byforcing ofprice. because Peru, like mostof the relevant These issues are particularly transofitsnineteenth-century withthefirst shocks region, was struggling to an open economy.56 alwaysappear Whydid Lima'seconomy formation currencies? This could have been a factor overvaluedrelativeto foreign thatplaguedPeru'searlyattempt in the economicand social dislocations did sticky price behavioradd fuelto at trade liberalization. Specifically, or aggravate unemployment, protectionism, Peru'sinitial (neomercantilist) lead to a faster dominance offoreign goods? demandor theterms oftrade, Domesticpricelevels,notonlyoverseas performance. New studies,forexPeru'sexport might also have affected silver mines oftheCerrode Pasco disample,showthatPeru'sdemolished in the postindependence period. trictactuallyrecuperated quite rapidly reachedcolonialpeaks. Deflation could By the earlyi840s, outputnearly at play,by raising the real local purhave been one production incentive Peru's miningsectorquicklyand chasing power of silver.Conversely, have become inflation might mysteriously collapsedagainat midcentury; This pattern of rise and decline was folfactor.57 one adverse cost-price guano,which,among lowed by mostofPeru'sotherexports-apartfrom insensitive to domestic costs. itsotherpeculiarities, was peculiarly is discerniblein Lima's halting After1845, the guano-agerecovery and by i855, in the inflationary spiralunleashedby risingdoreflation, mesticdemand. Guano droveup incomesand spendingin the domestic On the at least aroundLima, wherethe benefits concentrated. economy, estimates of exportgrowth otherhand, existing shouldbe moderatedin real terms.Overall, Hunt figures thatguanosales brought a totalof 454 high 71 millionpesos to the Peruvianeconomy-foran extraordinarily value"ratio.58 itself, (This,plustheevidenceofinflation percent"returned the traditional enclaveinterpretation ofthe guanoboom, i.e., the refutes
56. These issuesare elaborated in Gootenberg, Between Silverand Guano, esp. chap. 3, whichanalyzesthe variety ofresponses (economic, social,and political) to Peru'sentry into the worldeconomy.On price adjustments, see pp. 65-67 or Hunt, "Growth and Guano," 27. Nonwage labor,a mining economy, or faulty regional integration might lie behindsticky prices, and, surely, price factors were notthe sole problem afflicting Peru'swar-torn economy. 57. Deustua, Mineriaperuana; Hunt,"Growth and Guano,"43-51 (stillthe best cost mostexports analysisof nineteenth-century mining).Apartfrom guano/nitrates, stagnated Table 24. from1840 to 1870. Hunt,"Priceand QuantumExports," and Guano,"partsiv-vi,which theLevin enclavemodel; 58. Hunt,"Growth antiquated in some sense, enclavenotions thatstresslack of internal persistin interpretations markets (or foreign plunder)as causes ofnineteenth-century underdevelopment.
PRICES
PERU
35
thesis that most guano income directly bypassedthe local economyas payments to overseasinterests.) However, despite Peru's favorable termsof trade,by the i86os inflation was erodingthe real domesticvalue of the bonanza. How much guano benefits fellwould have to be computedon a yearlycumulative basis, but Peruvians themselves readilysensedthisdilemmaat the time. To many,inflation was the mostpalpable signofthe economy's distress. It is one reason(besides fearsofexport exhaustion and mounting foreign debt) thatthis enormously prosperous period alwaysseemed enveloped in an atmosphere ofimpending crisis.59 An earlierstudy oftheLima economy an exampleoftheneed provides to measure,witha priceindex,thereal growth in thedomestic economy. It was a detailed time seriesforLima businessrevenues,derivedfrom archivalpatentestax registers. The aim was to pinpointthe differential effects of exporttrendson local commercial, manufacturing, and service groups.In nominal terms, theaggregate indexran: 1830, 100; 1834,91.6; 1839, 91.8; 1844, 71.3; 1850, 98.3; 1857, 139.6; and i86i, 155.4. These numberssuggesteda severebusinessslumpby the 1840s,followed by a at theoutsetoftheguanoage. However, dramatic recovery whendeflated by the new price index,the series(in constant 1830 pesos) becomes less dramatic: 100; 94.7; 89.3; 86.7; 119.7; i28.8; and127.7 ini86i. Over three decades, businessexpandedby 28, not 55, percent.This drawsa more realistic portrait oftheextent ofbothdepression and growth in republican The mostchallenging problem ofthe guanoeconomy is also itslargest and enduring one: did Peru experienceany substantial productivity gains duringthis exportbonanza? Even Hunt, who created a GNP estimate for 1876-77, remainsin doubt. The clearesttest,analogousto workon Mexico and Brazil,requirescomparisons of national nineteenth-century productfigures from beforeand after the exportboom, and mighteven revealwhereproductivity faltered. A preguanoGNP estimate is feasible, and theprice indexwouldallowfordirect when comparisons, particularly forthe 1870s.6' data surface improved
ManuelPardo,Estudiossobre la provincia 59. For example,of the "crisis"literature, problem" offoodpricesin Lima as a spur de Jauja (Lima, 1862), 26 speaksofthe "alarming Estudio sobre la indeplans, whileJuanCapello and Luis Petriconi, to his famousreform as another signof pendenciaecon6micadel Peru (Lima, 1876,repr.1971), 26 readsinflation and Guano,"96 noteserodingreal guano independence.Hunt,"Growth the loss ofnational savingsrate. incomesin the context ofPeru'sdeclining "Artisans and Merchants," Tables2-3 andApp. 1-11 (andthisTable 9). 6o. Gootenberg, and laterones existto de Patentes, The seriesactuallycovers 14 yearsofAGN Matriculas Between extendit. For real per capita businessrevenues(by sector),consultGootenberg, Silverand Guano, App. Tables 2.1-2.2. 6i. Hunt,"Growth and Guano,"86-96 and appendix.Doubts existaroundHunt'sGNP
Lima.60
36
| HAHR I FEBRUARY
I PAUL GOOTENBERG
A price series also allows us to more rigorously test explanations of Peru's "lostopportunity" withguano. Hunt'swell-conceived model ofthe "rentier" economy ofguanois now theparadigm. In thisview,cost-price pressureswere the culprit, not the enclavish natureof export-generated incomes.The demandeffects released by guano rapidlyreverberated in the domesticeconomy, as and, theydid, helped releaseinflation. Guanoage inflation (and otherfactors) exacerbatedchronically overvaluedand inflexible exchangerates.Ultimately, thissyndrome led to an import bias, a narrowing the of country's economicbase, and the crippling of potential nativeentrepreneurs, such as artisans and factory pioneers.62 By the i86os, Peru had become an importing rentier nation,utterly dependent on the fortunes ofguano. Peru had caughta "Dutch disease,"but sought no cure. With price data and indices, we can begin to test aspects of this hypothesis. is one buildingblockofthe model,yetboth its oriInflation gins and its impactremaina black box. For example, was the guano era's initial pricechange(1845-55),whichnowlooksmodest,truly strong the economy enoughto shift to a damaging bias? Or was thisbias import era of plungingimport prices?Combinedwithotherprice information, such a studycould even advanceat the microlevel, how costexamining price pressuresaffected workshops or factories struggling againstimport
competition.63 Estima"Perui: without a reliablepriceseries:see Bolofia, estimate, whichwas accomplished Apuntes(Lima), 13 (1983), 3-14. A del productonacional,1900-1942," ciones preliminares might exploit the untapped1827taxcensus(whichincludescrudeaggrepreguanoestimate in La PrensaPeruana as "Estadisticas" mostofwhichsurvives gatesofincomebyprovince), and El Telegrafo de Limna,1827-29. "Obstacles to Economic Growthin Ninestudies,see Coatsworth, For comparative Mexico,"AmericanHistoricalReview,83:1 (Feb. 1978), esp. 80-89; and teenth-Century CurrencyData and an Income Trendsfrom NathanielLeff,"A Technique forEstimating Brazil," Journalof Incomeand Wealth,5 (1972), 355Application to Nineteenth-Century 368. 62. Hunt, "Growthand Guano," parts. iv-vi. Hunt'spithyworkis cited repeatedly it tackles.Andwhile Hunt oftheproblems rangeand precision here, due to the remarkable or addendumhas appeared in asks forstatistical and historical testsofhis theses,no critique see W. M. Corden,"BoomingSectorand on rentier economies, 15 years.For recenttheory EconomicPapers,36 (1984), and Consolidation," Oxford Dutch Disease Economics:Survey 359-380. shouldbe specified:the ofcost-price pressures 63. In otherwords,Hunt'sconception of domesticentrepreneurs" failurelay withthe unresponsiveness conclusionthat"growth and did notoccur.Inflation did notoccurbecause growth oughtto saymorethanthatgrowth the guanobusinessitself, to so impervious tariff policy,ofcourse,were notthe sole culprits; was boundto have rentier effects. local costfactors, records are ideal for theseproblems: an exampleis AGN, examining bankruptcy Factory de Consulado),Expedientepromovido por D. Eugenio Rosel soliciSection H-8 (Tribunal tando se aprueveel conveniocelebradocon sus acreedores,i851, Concursos/Contenciosos, thatclosedwiththesurgeofimports after 1848. candle factory leg. 19-an expanding
a more direct result of an ad valorem free-tradepolicy (1852 . . .) in an
PRICES
PERU
37
lie its chiefmysteries If inflation emergedas an obstacleto growth, of tradables/nontradafter1855. Once again, onlya studiedcomparison in real exchange ables price indicescan resolvethe degree of distortion Such studieshave, rates,and theirbiases fordifferent linesofproduction. in understanding Peru's path to deforexample,provedquite effective in theearlytwentieth century.64 pendentdevelopment to Hunt's In any case, the cursory evidence suggeststhat,contrary was notseverely out ofline withworldtrends, model, Peruvianinflation to not even in domesticfoodstuffs. At the same time, the secular shift tradablesis abundantly thepricedata. But whatever the clear,even from ofthisguano-age inflation still precisebehaviorofrelative prices,theroots so critical mustbe specified.Were domesticsupplyconstraints to overfoodprices(and theevidence valuation, as Huntsuggests, or do domestic of abundantsupplies) suggestotherpushes?65 Perhapsprofligate Peru's must havebuoyedexchangerates recourseto overseasborrowing-which synabove current exportearnings-was part and parcel of the rentier drome. On the whole, then, this price series sheds lighton Peru's path to worldeconomy and on dilemmas integration withthe nineteenth-century shared by manyof the opening Latin Americaneconomiesof the era. is that,overthesesevendecades, Peruvianprice One remarkable finding the NorthAtlantic econmovements paralleled trendsseen throughout until the 182os; thedeflation to the i850s; omy:thehigh-priced instability and the inflation the mid-185os to the mid-i870s.66 from mean we should abandon purely Does this rough correspondence thatLatinAmerican economies were Peruvian causality? It at leastimplies well integrated withthe worldeconomy from an earlydate. An interestPolianalysis; "Tariff Bolonia, Peru,chaps.3-7 is theexemplary 64. Thorpand Bertram, of modernreal exchangerates. I cies in Peru," is even more precise in its measurement price trendsin the nineof comparing domestic and import mustreiterate the difficulties point themselves are elusiveto define.A starting teenthcentury; above all, the categories extranjeros" often seen in nacionales" and "Productos listing of"Productos is the customary (e.g., La Patria,Jan.1872). newspaperprice reports the claimthata constraint emergedin 65. For example,littlehard evidence supports on cattledelivered The statistics meat supplies,despitethe plaintsofthe 1869commission. in thelate guanoage alone, a rate to and processedin Lima show50 to 75 percentincreases See Macera, "Plantaciones Table 38 and azucareras," exceedingthatofpopulationgrowth. where meatwas one commodity though, Carestiade viveres,16-17. Significantly, Martinet, costpressures. international imports barelycounted;i.e., it was isolatedfrom and betweeninflation On loans, see n. 83 below; mypointis not a directcorrelation the early exchangefrom large loan issues, but thatthe steadilyupwardstreamof foreign i85os on helped postponeexchangerateadjustments. divergefrom worldmovements. 66. With the PacificWar, Peru's price trendsfinally Two world indices consultedhere were NorthAmericanWholesale (in Mitchell,InterHisBritish RousseauxIndices (Mitchell, nationalHistoricalStatistics, 835) and the British as the is known Prices3, pp. 722-723). In partsofIowa, thisphenomenon toricalStatistics, "law ofone price."
38
| HAHR I FEBRUARY
I PAUL GOOTENBERG
ing testis whether thecorrelation proves weakerwithcolonial-era prices, and stronger as the century progressed. Whatwill be learnedabout this process fromnew nineteenth-century indicesfromotherpartsof Latin America,including the ruralzones? One also might investigate the price transmission mechanism from the worldeconomy. It could have worked through highpricesand demandforprimary exports (as often assumed), combinedwithbullionmovements, an expansive exchange rates, tradables sector,or even consumption effects and modernfinancial flows.67 And, finally, to what extentdid thisprice dynamicspread fromcommercial, coastal,cosmopolitan Lima to thebackwaters oftheAndes? 2) Social Analysis.A reliablepriceseriescan guidemany intosocial forays history from specifying distributive trends and class relations to identifying the causes and patterns ofsocialprotest. Pricesmayeven illuminate the economicmentalities ofan age. On the broadestlevel, historians may wonderabout the contrasting in preindustrial social effects ofdeflation and inflation a themeof settings, European historians from the Black Death to the price revolution ofthe century.68 A generalproposition sixteenth is thatdeflation tendsto favor lies largely those groupswhose consumption outsidemarkets (the poor); is often seen as redistributing inflation income(through conversely, wages and profits) in kind)are set by to wealthier classes. Ifwages (orpayments custom,the impactis stronger. For Peru between independenceand the guano age, deflation may have had a democratizing effect.It could have eased social distances by raisingthe real incomesof day laborers(jornaleros)and subsistence farmers thoseoffaltering eliteslinkedto the urbancommercial vis-a-vis classicpriceand profit economy.Moreover, incentives to enclosepopular resources(such as communal lands)were on thewane, as usual at a time of depressed prices and fragmented In the towns,guild momarkets.69
and NathanWachtel,Preciosy produc67. For the colonialera, see EnriqueTandeter ci6n agraria: Potosiy Charcas en el sigloXVIII (BuenosAires,1983);thisbook developsan prices(in this between"European"and "American" elaboratemodel about the relationship ofthecorrelations needed to testit. For a view important international zone), butstopsshort comercial." ofintegration through export demand,see Bonilla,"La coyuntura in Sixteenth-Century 68. See, for ed., ThePriceRevolution example,PeterH. Ramsey, forruralareas, studiesinspired by Earl Hamilton); England (London, 1971)(one ofmyriad en Normandie Orientale Guy Bois, La crisedufeodalisme:Economieruraleet demographie du debut du 14e siecle au milieudu i6e siecle (Paris, 1976) or, excusingthe title,Witold Towardsa Model of thePolishEconomy, Kula, An EconomicTheoryof theFeudal System: 1500-z800 (London, 1976). ofcoastalslavery durexample, thedeclining profitability 69. All evidencesuggests, for rural pricemodelin Hunt,"La economia ing the deflation/depression period. See a specific de las haciendasy plantaciones en Am6ricaLatina,"Historiay Cultura,9 (1975), 7-66; or to case byJuanMartinez Alier, Los huacchilleros del Peru:Dos estudiosde evidencebrought
PRICES
PERU
39
nopoliesrevived, posingso minor a threat in a low-price era. Therewere in the postindependence manylooseningsocial hierarchies era: between landlords and peasants,artisans and apprentices, masters and slaves. The guanoage, withitsinflation, wouldhave reversed trends on many fronts of class conflict.Did inflation aid the reconstitution tangibly of elites?Manyfactors can redistribute incomeduringrapidgrowth. But it in the i86os thatone detectsrenewedefforts is precisely to expandPeruvian estates,some specifically fordomestic foodproduction. Apartfrom buoyantprices, old entailsbecame less a burdento landlords, and new forms ofcreditbecame availableat strikingly low (and plainlyredistributive) real interest rates.70 In Lima, inflating urbanreal estate musthave become a hotinvestment for therich.For urbanareas,analysis also might focuson the relativeclass impactof imported and domesticgoods. Did inflation distribute incomeand cloutawayfrom subsistence-level artisans, shopkeepers, and laborers,and towardeliteswhose marginal propensity to consumeincludeda highpenchant forcheapening The price imports? protests invariably eruptedfrom below. The contentof popular protests(as in 1855, 1858, 1865, and 1872) alwayshad something to do withprices.Indeed, Peloso arguesthatafter midcentury subsistence became themostexplosive people's issuein urban to thepolitical formation ofa modern Peru's politics,integral proletariat.7' recourseto freetrade in government placated the masseswithgrowing and precociouspopulists(suchas MayorPardo) seized on the foodstuffs, anti-inflationary issue. This price seriesunderscores thesedevelopments,
formaciones sociales agrarias (Paris, 1973); and FlorenciaE. Mallon,The Defenseof Comin Peru'sCentralHighlands:PeasantStruggle munity and CapitalistTransition, 1860-1940 (Princeton,1983), chap. 2. For Lima, see Gootenberg, "The Social Originsof Protectionism and Free Trade in Nineteenth-Century Lima,"Journal of LatinAmerican Studies,14:2 (Nov. 1982), 338-342, 351-358. 70. Engelsen, "Aspects of Agricultural Expansion,"chaps. 2-5; Mallon, Defense of forfood markets. On the Community, 60-63, fora specifici86os case ofestateexpansion (literal) rentier class, see Quiroz, La deuda defraudada, chap. 6. In the Chileancase, a vast literature debatesthe class impactofnineteenth-century inflation. Interest theredistributive ratessuggest many pertinent questions, including (bankcredit in the I850s and i86os, as both inremainedhighlyconcentrated). Rates felldramatically flation and formal banking began. At 8 to 12 percentnominal interest, thismeantnegative real ratesformuchofthe era. Conversely, during the first threedecades ofthe republic,36 a deflationary era. Apartfrom changing percentannualchargeshad been the norm, during thispattern a riskfactors, sourcesof Peruvianprice movements: again suggestsmonetary ofcurrency and an overabundant truescarcity during thedeflation, money supplybythelate ofcredit,see Macera,"Plantaciones guano age. For an overview azucareras,"129-150. We need nineteenth-century researchanalogousto Quiroz'srecentstudiesofmodernfinancial institutions. or Blanchard, 71. Peloso, "Succulenceand Sustenance"; PeruvianLabor, chap. 2. For two close analysesofthese price protests, see Quiroz, La deuda defraudada,119-123 and en la historia, Giesecke, Masas urbanas y rebeli6n chap. 4.
40
| HAHR I FEBRUARY
I PAUL GOOTENBERG
betweenprotests and trueinflationary mobyunveiling a correspondence crowdsindeed to such analysis, forLimefno ments.Still,thereare limits of"just"and customary prices,i.e., ofa subsisthought in subjective terms therelation (Historians probing tence security, without sharpfluctuations. and on shouldperhapsconcentrate foodstuffs, between inflation protest themselves wherepopularperceptions and on variations aroundthetrend, 72 often focus.) Yet, beforethe i850s, the main popular standardwas actuallythe opposite one: incessantartisandemandsforhigherprice levels through and guild monopoly. Rarelydid populargroupsembrace protectionism the Lima bread monopolies thattook subsistence causes, noteven against such flackafterindependence.This all makes sense amid a deflation. of urban politics Between 1848 and 1858, however,the transformation free trade, watched their occurs. Craftsmen lost out to Manchesterian and undermined, and joined the noisychorusfor guild powers vilified This was notjust the resultofeffective liberal inexpensive wage goods.73 and populistManwhichby thenwas borrowing newfangled propaganda, chesterianideas. The inflationary shockof the i850s palpablyhelps to and policy,as well as thischanging to free-trade politics explainthe shift content ofpopularmobilization. These matters are all partand parcel ofthe distributional questionof a With this social (as it was called) question the guano age. price index, can become far more precise. Real wage rates,forexample,could be in Lima. Spottydata revealthaturban jornales reexploredthoroughly 6 reales independence through from mained stationary at the traditional to and 8 the 1850s;the dailywage thenrose 7 realesovereach ofthe next in constant was on the two decades. Therefore, 1830reales,wage growth orderof 17 percentby 1840-42, or 19 percentby 1850-52-due simply to deflation. below 1830 levelsby i86o-62, and Wagesthenfell7 percent 19 percentbelow themby 1871-72.74
to E. P. Thompson's conwritings, similar abound in Lima artisan 72. Such sentiments Century," Past ception in "The Moral Economyof the EnglishCrowd in the Eighteenth analysis oftimeseriesis clearlyexplainedin and Present, 50 (May 1971), 76-136. The trend tool; the historian Methods,chap. 6. This is notalwaysthe appropriate Floud, Quantitative ones. werepatterned mustfirst ascertain thatvariations by comparing in attitudes towardprice levels can be seen graphically 73. The shift "Representaci6n que han elebado los Gremiosante las Camaras,"El Comercio,Oct. 17, foundin Artesanos(pamphlet,Lima, 1859). supplications 1849, withthe subsistence-cost Jose Sime6n Tejeda, La emancipaci6nde la industria(Arequipa, 1852) and Gootenberg, See Jos6Silva Santisteban, chap. 4, deal withguild monopoly. "Artisans and Merchants," en Lima y el Callao con motivode la imporsobre los sucesos ocurridos Breves reflexiones response taci6nde artefactos (pamphlet, Lima, 1859), 36-38, 54-55 forthe Manchesterian withinflation to artisanconcerns and rents. and inconsistent; sincejornal data are so spotty numbers, 74. These are verytentative I use hiredpeon wagesfrom the hospital accountbookslistedabove. See Quiroz, La deuda
PRICES
PERU
41
The striking finding here is that,giventhe largelystationary urban jornal, real wages droppednearlya quarter(22 percent)duringthe first decade of the guano age. And this measure,of course, does not even thescourgeofunemployment consider amongLima'steeming population, estimated at roughly i6 percentby 1858. SmallwonderLima's destitute in December 1858against violently tookto thestreets this"fictitious prosperity."75Amongthe populardemandswere lowerrentsand lowerfood duties,but nothigher wages. Does socialcustom help explainthisadverse wage-distributional effect oriented elitescope better withinflation, duringinflation? Commercially as they are accustomedto bargaining over prices as a way of life. For whateverreason (including adscriptive prejudiceand barriers), popular groupsseem to lag in adopting a haggling attitude on wages. In Lima, for example,the first recordedstrike overwagesoccurred onlyin 1869-and was organizedbyconstruction workers, aptly enough,whiletearing down the city'soverflowing walls. But this is a more generalquery. In parts of ruralMexico, forinstance,a stationary peon wage has been reported formostof the nineteenth century.76 Surelythatwas a boon to hacendaas price levels inchedupwardduringthe dos, and a plague on workers, century. RuralPeruhad itspeculiarities. Scattered evidencesuggests that wages in the late guanoage: from on coastalplantations rose dramatically a 3.5real normin the mid-iS5osto anywhere between7 and 2o reales by the This was due to Peru's chronic labor shortage early 1870s.77 agricultural
azucareras," defraudada,Table 13; Macera, "Plantaciones i65-i68; or Hunt, "Growthand Guano," 87-88, fordifferent nominalwage data. These sources(and even originalsurveys often conflate ruraland urbanwages,or use servant wagesthatexcludethe such as Martinet) see JuanNorberto Casacustomary three-to-four-real dailyfood and lodgingsupplement; del Peru de la industria algodonerafabril nova,Ensayo econ6mico-politico sobreel porvenir contemporary guide to urbanwages and (Lima, 1849),chap. 4, "Salarios,"the mosthelpful is the surveyin Miles to Calhoun, livingexpenses. A superb source on wage differentials Aug. 25, 1855, M155/1. or "false"prosperity is the name used by Basadreforthe guanoboom, 75. "Fictitious" critics.See El Comercio,all Dec. 1858-Jan.1859 forartisan following its contemporary the riots;partially reproducedin FranciscoQuiroz welfareperceptions and demandsafter Chueca, La protesta de los artesanos,Lima-Callao1858 (Lima, 1988). Male unemployment low (ifwe considerthe rate is from Fuentes,Estadisticageneral,621-623, and is probably forforeign better migrants). job opportunities V, 2,045-2,047; HarryE. Cross,"Debt Peonage 76. Basadre,Historiade la Repuiblica, Reconsidered:A Case Studyin Nineteenth-Century Zacatecas, Mexico,"BusinessHistory analysisis foundin Cross's "Living Standards Review, 53 (Winter1979), 480. A different Mexico: Zacatecas, 1820-1880," in Rural Nineteenth-Century Journalof Latin Anwrican ofinflation can be seen inpeasantstrugStudies,10: 1 (May 1978),1-19. Someoftheseeffects on "New Thinking or otherwise) to resist wage payments; see I. G. Bertram, gles ("rational" PacificViewpoint, 15 (Sept. 1974), 89-111. the PeruvianHighlandPeasantry," are but 77. Obviously, giventhe thindata (and use ofa Lima priceindex),thesefigures azucareras,"164("Plantaciones suggestive.I use variousMacera and Huntjornal figures
42
| HAHR I FEBRUARY
I PAUL GOOTENBERG
the so-calledfalta de brazos-which meant,in reality, real 20 to 200 the premium percentpay raisesforworkers, notcounting often afforded by food rations in kind.These estatecostsno doubtadded to highurban withthe foresight and meansto acquire coolies prices. Only landowners (withfixed long-term wage contracts) blunted theproblem. But whywere real urbanand ruralwages movingin oppositedirecthatmigration tionsafter1850? Price history suggests patterns are worth in nineteenth-century further Peru. Contrary to our image of exploring Peru as an immobilized land, some 37,000 internal migrants flockedto Lima duringthe 185os, becomingmorethana thirdof the population. This human wave surelycontributed to the dampeningof urban wages duringthe guano age. Yet, what brought migrants to a revivingLima, and not, accordingto all witnesses, to the expanding coastal plantations thatwere offering premium wagesby i86o? One wondersabout discrepancies between low provincial and inflated capitalprice levels was this an initial(ifchimerical) forthosemainlyseekingremittances pull factor It mayhave been easierto see highprices(ornominal back home?78 rates of pay) thanto calculatereal wages. On the otherhand, the Andean migrants'aversionto workon high-wage coastal estatesseems even more was nota pricecalculation at all, but a cultural perplexing. Perhapstheirs estateregimes and to laboring aversion to oppressive alongwithoppressed like coolies and blacks. These are among the more complex minorities ofprices. social history questionsraisedby the simplehistory 3) PoliticalAnalysis.State buildinghas recently emergedas a pressing theme in the history of Peru. However,we stillhave littlegraspof the real growth thiswas in effect theformative ofthe guano-agestate,though state. stageforPeru's modernnational/administrative
au Perou L'agriculture 169; "Growthand Guano," 87), both based on J. B. H. Martinet, thegapsare startling, sincebythe 1870s,2 soles(20 reales) (Paris, 1878).AroundLima itself, daywork. foragricultural was commonly offered azucareras, 150see Macera,"Plantaciones For an analysisofthe rurallaborshortage, thatcoerced laborforms (suchas coolies)dampenedwages may assertion 192. The common freelabor market, the opposite,at leastforthe remaining suggests be wrong.Price theory betweenurbanand coastalwages. explainPeru'sdiscrepancy whichmaypartly 78. AlfredoG. Leubel, El Peruien z86o o sea anuario nacional (Lima, i861), 266; of Lima's inhabitants were Fuentes,Estadisticageneral,625; in fact,by 1857,onlya third to born there. See Henri Favre, "The Dynamicsof Indian PeasantSocietyand Migration in CentralPeru,"in Land and Labour in LatinAmerica,KennethDunCoastal Plantations and can and Ian Rutledge,eds. (Cambridge,1977), 253-269, our onlystudyof migration the remittance one suggesting pattern. wage the i866 Rodriguezprovincial In stillanothertrenchant analysis,Hunt employs changeoccurredin the regional productivity wages,negligible surveyto showthat,through how thisevidenceconcurswiththe and Guano,"87-93). One wonders guano age ("Growth fromhigh-to and whetherthrough (i.e., remittances price differentials migration figures; ofregional incometransfers. variety low-price zones) we have an overlooked
PRICES
PERU
43
In current expenditures, statespendingswelledfrom 4.5 to 48.8 million pesos between 1847 and 1872, or overtenfold! And thisestimateexcludes all external and internal debt transfers. Calculatedin real terms the resources the stateactually commanded-thatexpansion was morein the rangeof5.25 times,stillan impressive record(orwaste).The guanoage state'sreal revenuesincreased4.7 times.Moreover, real growth was steadilyupward;roughly 55 percentoccurredbeforethe elevatedprice level ofthe i86os, and 45 percentthereafter.79 So, inflation per se did not haltthe expansion ofthe state. Disaggregated trends shouldalso be revised.One exampleis thestatistics produced by the indefatigable Hunt on empleomania, concerning the traditional allegationthat the state threwaway its income in lowproductivity political In thecourseoftheguanoage, ifmeaemployment. sured in constant prices, average salariesof seniorbureaucrats such as ministers and prefects actuallydecreasedsome 44 to 59 percent.Global spending on civil servants and military men (includingtheirpensions) went from3.6 to 7.3 millionpesos between 1847 and 1870, an apparent rise of 103 percent.In real terms,this meanta tinychange of 5.9 percent.80 For theseelites,theguanoage was a surprisingly fictitious prosperity, too. To be sure, such analysesoverlook in otherpertinent factors incomeconcentration, orinfluence, e. g., theexistence ofmulcorruption, tiple prebends forelite family networks. But the clear point, as Hunt is thatbloatedemployment was notthe core difficulty alreadysuggested, withthe expanding guano-agestate. Social theorists haveoften a closerelationship postulated betweenstate The guano-age building,extractive capacities,and inflationary cycles.81
all finance(debt) 79. Based on Hunt, "Growthand Guano," Tables 8-9, eliminating are not verydifferent from Hunt'sown guess data, and using a i.8 deflator. These figures (n. 154) of a fourfold real increase in the guano age. In Tantalean,Politica econ6micovalues alone, withsome interesting financiera, 141-144 the state is examinedin current results(and misunderstandings). ofHunt'sdata("Growth and Guano,"81-82 andTables9, 8o. These are all recalculations good theselow real salarieswere such an unambiguous ii). One wonders,though, whether thatoccurred? corruption thing:would thisnothave been a push,as well, to thehigh-level oftheallocation ofgovernment spending (Table io) could also Hunt'sincisivecalculation be revisedin real terms: since mostofthewasteful transfers ofguanoincomeoccurredin the preinflationary early 1850s, thiswould accentuatetheirnegativeimpacton developmental prospects. 8i. For example, Michael Mann, The Sources of Social Power: A Historyof Power 1986), 1, esp. chaps. 13-14; GabrielArdant, fromthe Beginning to A.D. 176o (Cambridge, in The Forof ModernStatesand Nations," "FinancialPolicyand EconomicInfrastructure 1975), 169-242; and, of mationof NationalStatesin Europe, CharlesTilly,ed. (Princeton, see Gootenof Hamilton.For Peru's statefiscalstruggles, course, the classic formulations and Quiroz, La deuda defraudada berg, BetweenSilverand Guano, chap. 5 (182oS-185os) (1850s-186os).
44
| HAHR I FEBRUARY
I PAUL GOOTENBERG
state,however, was largely "autonomous" in thatit owned and borrowed on an independent source of income,its guano monopoly. By 1855, the enrichedtreasury abandonedanydependenceon directtaxation, and the statelacked the will and meansto return to tribute and othertaxeswhen deficits widened and costsrose. By the i86os, greater than70 percentof revenuescame from sales ofbirddung. Majorfiscal struggles thusdid notrevolve, as so often happens,around peasants, regionalgroups,or othertaxabletargets. Apartfrom its sheer wealth,thisfiscal freedom is whatprobably allowedthestatetheability to expandso rapidly, whileavoiding the socialconflict endemicto suchprocesses duringinflations. A revivalof Indian tribute, forexample,would have sparkedsharpresistance, forquotaswouldhave had to exceed customary levels.82 What, then,was the state'sresponseto itsperceivedcrisesin real income? Peru turnedoutwardto massiveforeign creditin the i86os and 1870s, amassingLatinAmerica's debton the Londonmarket. Hislargest toricproclivities, a mania forhuge projects,a strong creditrating,and waveringguano sales all contributed to thisoutcome.Yet, one wonders also whetherthe inflation of the era became an incentive to this growA relationship recourseto overseasloans.83 ing, and ultimately disastrous, in a typical fiscalratchet-effect and loans is discernible between inflation duringPeru's episodes of war. In tandem,debt, spending,and inflation leapt upward,and the size ofthe publicsectorneverreturned to itsprevious levels. And did overseasloans,in turn, just contribute to viciousinflationary borrowing cycles? This state appears to have done little,given its extractive to dampen inflationary demand-whereas thosewhich strategy, relyon taxation or local borrowing do, inadvertantly and now purposely, as theyexpand.The guano-ageleviathan in multiple appearsinflationary senses oftheword. 4) RegionalAnalysis.Some ofthe foodpricesin thisstudyprovideclues
thatfedintothe Huancan6 Indian rebellionof the fiscalstruggle 82. This is precisely thewarwithSpain: see Jean from reimposed to coverdeficits taxeswere (briefly) 1867, after Century," in the NationalLifeofPeru in the Nineteenth Piel, "The Place of the Peasantry Perhaps, Past and Present,46 (Feb. 1970), 108-133,whichis a globalfiscalinterpretation. threedecades of the duringthe first quietismof the Andeanpeasantry too, the mysterious (whichthen even ifthe real weightof tribute factors, republicwas relatedto deflationary rising. dominatedfinance) was modestly betweenthe yearsofmassiveloan issues is discernible 83. While no directcorrelation steadily peaks,Peruhad been borrowing (1853, 1862, 1865, 1870, and 1872) and inflationary BetweenSilverand Guano, 132-137, forhistorical since the late 1840s. See Gootenberg, analysisof this creditdependency;Carlos Marichal,A Centuryof Debt Crises in Latin borrowing America(Princeton, 1989),chaps. 4-5, forPeru'ssaga and aspectsofinflationary in othercountries.
PRICES
PERU
45
in shift development, forexample,the long-term to regionalagricultural thevalleyofChancay.Were thereanyprothe priceoflardcomingfrom existwithsome ductivity gainsat work?And did truesupplyinelasticities ofmorevolatileprice,suchas rice or beef? We stillhave ofthe products on local producers,or impactoffoodimports littlegraspof the growing Continuous of estate decisionsto investforurbanor overseasmarkets.84 estateand regional price data help here, but we surelyneed pricesfrom recordsas well. of"inoften studiedunderthe rubrics Regionaleconomicintegration, is a burning penetration," or "commercial ternalmarketdevelopment" disarThe old imageofan utterly issue in Peru's modernhistoriography. Peru or "feudal"nineteenth-century immobilized, ticulated,nonmarket, is fastfading.On the otherhand, the extentof Peru's marketintegrastillmistrust quantitative addressed. Some historians tion is not directly economiesany regional thatfor fragmented on theground work,precisely serieswillprovemisleading.85 uniform statistical But the core economichistory. True, a spuriousprecisioncan infect collect question here is actuallyempirical.To the extentthathistorians coastalLima, we could test thesefrom regionalpricedata to complement market was nonexistent, integration the varying thatnational propositions Cursory data suggestthat duringthe century. decreasing,or increasing centers,though Lima price levelswere "higher" thanthoseofprovincial between regionalprices thatmatterin correlations it is the time-series With such studies,historians could resolvethe possibilithis problem.86 and market-type analysesin this quantitative ties, and limits,to further setting. preindustrial As discussed, Peru's coastal economyappears to have been deeply and we need to know how these mired in world economic currents, regional prices, washedintothesierra.The mostobviousneed is to gather
84. Engelsen, "AspectsofAgricultural Expansion," chaps. 2-5 contains the best information.One transition exploredis Peter Blanchard's "Socio-EconomicChange in the Ica Region in the Mid-igthCentury"(manuscript, Amsterdam, 1988); Macera, "Plantaciones azucareras,"262-265, stressestraditional explanations. New researchon Pisco plantersby price-hunter Peloso mayprovidenew answers. "Plantaciones 85. Notably,by Macera, in the number-rich azucareras,"260-261; also AlbertoFlores Galindo,"Los rostros de la plebe,"Revista Andina,1 (Dec. 1983),n. 15. For a new view of "internal markets" (and perhapsAndeancapitalism), see Nelson Manrique, Mercado interno y regi6n:La sierracentral,1820-1930 (Lima, 1987),esp. chaps. 1-3. 86. See, forexample,national market in SusanP. Lee and PeterPassell,A New analysis EconomicView ofAnerican History (New York,1979),chap. 7. Regionaltownprice levels are easilyglimpsedin theirtaxregisters (e.g., AGN H-4, Librosmanuscritos republicanos: Or see foodpricesin W. Smyth and F. Lowe, Narrative of a Journey fromLina to Para, AcrosstheAndesand Down theAnazon (London,1836),43 (Cerrode Pasco), 66 (Huanuco).
Arequipa, 1827, H-4 1621; Cuzco, 1826, H-4 1614; Huamanga, 1833, H-4 1705, and so on).
46
| HAHR I FEBRUARY
I PAUL GOOTENBERG
However,regional concerns and explorethe rangeand depthofmarkets. in all price studies.Lima's condimension also raise the cultural/spatial the whichmostresembled thoseofthe West,formed sumption patterns, index.Regardless offindings particular cost-of-living basis forthisstudy's decide that,culturally and historians mayjustifiably on market influence, of Peru were worlds apart. peoples and corners ecologically, the various Regionally based indices, A coastal indexcannotsuffice forall problems. would be particularly apt for derived fromlocal consumption patterns, on welfare.87 assessingthe impactofpricemovements in closing,the spiritof such researchsuggestions. Let me mention, characterized theprocess Severaldecades ago, a venerable socialscientist a itself as ferment of from linkages, ofeconomicdevelopment proceeding and trickle-down is not a "balanced" development effects; bottlenecks, price,forexample, anyone'smaster plan. An awkward process,norfrom Muchthesamecan act as a stimulus to growth acrossmany sectors.88 might in which flowssmoothly be said of progress historical rarely knowledge, than any of this study'srough or fromagendas. Thus, more important field. developing findings are the spurstheymayprovideto our rapidly
Andean con87. For example, the prices of tubers,maize, and chicha would affect structures production/consumption might be thedetailedsierran sumersmore.A prototype workedout by Figueroain La economiacampesina(esp. Table IV.6); indeed, one suspects patterns have notaltered expenditure communities ("sierra-sur") thatin his mosttraditional century. since the nineteenth radically Development (New Haven, 1958): The Strategy ofEconomic 88. Albert0. Hirschman, too. forknowledge, good strategy i.e., a pretty
?L0 6
00 c1-C) 4
t-
ca t- c6
t-
t d
as t C
ll t~ 1:
t-
16
C~ cs
_ _
e c0 0Q C0
a:
Ci t
W Q
r-
o-s rz-'~
-C
c0' -
3cl
a100 10' .t1
01
C~o0 t 1CY 14
o 4
c~)
C,,
cC
00o1
co0
QO
0.4
P: C~1 S = Ut Ut n n 0D t 00 b w 't m P-4wCDC
U~~~~i
14-
i6 i6i
6l
t--
bW
1.
O~lt
e6C
i;; X Q Qc t~~~~~~~~~~~~~~~~~~-
i6
c~~ H
~ ~ O
>-
~~001~~0
O
oo o o l
C> C.
(~
~ -
00
00 1-
C7)
_Q
(L ,
t
-
(M o ar b 1i
o 0 -
i -
i 1
l N -
C9 sc 6 i 1
N 1 i
cs i
ca 00
c N N i < i i
cO -
c c) -
cO 0
C,,
cO 0 -
c c
cO
GO
co
co
co
Oc
Oc 00
cl
m v-
O O
cq
C,
-,
t-
co
co
Its
0I
e~ Q
E;~~~~~~~~c in b
]
biN
CD QC
~
oo N
~
K~~
t-
ar~~~~ ct ~~~ ci ~~~~~~ ~co
00
C\ co
co cli cq c1 cq
in in
ooin NN
00
co In.
co cq cs
c\l
mt
01
oo
too
C\l o
00 moo
cq
00
cq
to
It co
OC\I
f~~~~00Oc
(CC
~00000 O4 C64
6C6C
0101
1t 00
C4
~6
O0
in
00
0000
OOO
Q
C) Q
CO
COCO CO
CO CO CO CO
10
ss
0000000000000000000
00000000000 00000000000000t tt
KK
KK
Cl
~~~~~t~~-10 O~~~~~
10
OC
10
OC
co
10
CO
OC
10 o
t-
t-
COs oCi
0 i
O0 i o i
oo _o
0 - t o,CC
tC
cqcn
--
N N N N _i
N N iCt:)
010
co 0 co co I
Cl~~~~~~~~~~~~~~~~C
_
c cob. oo
Ct:)(>
cq oo o
It C
10 t. b.
CL.N
00 ClClCO 1 CO CO C CCO Cl NCO CO01 Cl t
1 10 C:C
CbUO CO
c: *o
ico
10 4 , co co
10
n*
Ct
Cl
CO
1r)1) 1) ooo oo00
C.C CC t-
tC 1) s C. Cc :sC Cc C. sC o oooo o oooo
co
t o o
10
o o
10
10
oooo
n Cd n
m- O 1 co "t t C b b b o oo o oooo
Cl
Cl~~~~~C
n t s s b
t ;
~~~Ct)
tlzt
S /
on
Ot
3~~~~~ir
C1 :6
t- m00 00
O O CO O O
O O O
O~~~~~C
Z02
0 -Z O co O. co 0~~~~~~~~~~~~~~~~~~~~~~~10 t C: C. '"q 10
CO
000
.:
Q~~~~~~~~~
C) CO C) C) C) C?) }t )
n
C)
0~~~~~~~~~~~0 O O~~~~~~~~~~~~~~~C
c(CrSr) Ol . O CO C O
o
v n N
s~~~
o
o x o o x o o
o C
M? N
o N o N o N o N o
0 t- t- tN N o N o
x
N o
x
N o
x
N o
M M
N o oo N oo co co o co o co o oo co oo co oo co oo
oN
co o
Noo co
co co o
cq
. c cq~~~~~~i CO
C:
o~~~~~~~~~~
Cl
~C
C)1 Cl~~~~~~~~~O CO co o
10
ir oO
n C: N
O O i
0 ~
C~
o "t 06CID
cq
10 10
mC)Cl
M M
COM
c?:
Cl
~~~~~~~~~~~~~~~oi
10 1 0co t- O O0 O tO OC 10 '"qt c: N: oo OC OC OCioo
co
ir~
cq
co co
ci
ico
co
cO
Cl
c_
c:
Cl
co co
06
c~
It
10
_o 0o
cq .
_i CN
tL
C1 6 c C6 c:: c:>
0 o
0
c c
az3i
01 N
_i
C
i N co
0
tzN 0 r .=
CO~~ C* C* C*
co co con c: o
C*
C*
C*
oo oo o oo oo o oo oooo oo
o co cs o co
C*
icin
o oo oo o oo oooo oo o oo
0
* n* n n n * * c oo o oo oooo oo o oo oo o 10 o0 o0 o0 10
oo o
1
cs
10
c:
s~~~~
~ ~~~~~~~~~~~~~~~~~~c
=; Ht
t~~~~ ~~OC
)0 . . . . . . .
.~~~~~~~~0
0 '
U~~~~.
10
C.C _
CE7
~ ~~ ~ ~ ~ ~ ~ ~
o o
~~C
10 oCo C)
C~~O
. v~~~~~~~~ 0 oo oo o o 't
N~~C
< to 0 bo 0)O
C)~
o xx
~
o t xx
~
co x
~ ~~C
o xx o x
C
m
D0 . xx
~D-i01 oo
0o x
Cl)
cq
Oc)
ci
l > I O
c~~~~~~~~~~~~~c
oc> * I CO
r Ct
~~0
00
4C:
_^
_1 iCtttN
t N
00 CO
00
ci
05)O
cq 00 0
q 0
OC:)t.
OC) C)
.c?
co~~~~~~~~c
0~~~~~~~~~~~~~1
C X
Q
t't0
0 .
1,
010
C-
00
OC)c
coc
q q
~~
(?C
co
D~
~~
~C
10 cq cq
3-z1
oi cq cq
cq
C) Q
~ c
co
i
co co
f~C
Co
X~~~~
0 tQ O
--- cq
cq
q cq
q cq
q 01
1 0
co co co co co coc
oc
QQ C,) cqc
It
4-
cod Q~~~ c Q~~~~~~~~~~~~~~~~ >
OC t0 OC) 000~~ -
-S~~~~~
C) 010 's Ce Q Q~~~~~~~~~~~~~~~~~~c 4-0C c O C-_ C 0
1 -
COI
C) c
cliC)
N
-j o
_o
_ -O10CI
U~~~~~~~~~ m^~~~~~~~~~~~
01
Om0 Q cq1
C,,)
0 0
00
~cO
-
'C)
c
COC
'I
Z
.4co m,J
i;~~~~~~~~~~~~~~~~~~~~~~~1
oo -
CtO
O O _
10ot0
O _ O
oC
Ct O
C-
1 O
4 -4-~ - -4
~--
-1 -i
-i
--i
~-
4 --
- -
- --i
--i-.
4. n cs cs cin
410
CO~~
-
co~C c C
co
-~~-
CO O
cO
CO 0-1
--
10 CO
loQ
oMl
01
10
10 10 10
.4 t
"It
'
CO
10
~~
-----
10
10
--
--i5
---
----
--
----
56
APPENDIX
| HAHR I FEBRUARY
I PAUL GOOTENBERG
(continued):
Sources: See notes4-17. Source Key: BC British consularreports 1897-1906) Blanchard,PeruvianLabor, Table 7 (Lima commissions, B/L BP Beneficencia Publica de Lima (hospitals) C w-wholesale) El Comercio(r-retail, CS Generalde la Naci6n(AGN) Conventossupresos,Archivo 1860 F Fuentes,Guta hist6rico-descriptiva, App. 11 (various) H Haitin,"Prices and the Lima Market," HM Hospitalesmilitares (AGN) azucareras," Tables 35-37/1869Lima commission Ma/69 Macera, "Plantaciones Ma/f Macera, Table 39 (flour) Me Melzer, "Price ofWheat,"Table 3 MP El Mapa Politicoy Literario P La Patria PC de Lima" Perez Cant6, "Abastecimiento Publica) Q/BP Quiroz, La deuda defraudada,app. I (Beneficencia RP El RedactorPeruano SC San Carlos Academy(AGN) TL El Telegrafo de Lima Units:See n. 18. ar arroba b barrel bot botija bushel bu car carga cos costal fn fanega g gram gl gallon lb pound m mazo mu pdr qt sc ser tn tr u v wh mula piedra quintal saco seron ton tercio unit viaje wheat(bu)

Carneros y Chuño

Hochgeladen von

Dokumentinformationen

Originaltitel

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

Carneros y Chuño

Hochgeladen von

Copyright:

Verfügbare Formate

Carneros y Chuno: Price Levels in Nineteenth-Century Peru Author(s): Paul Gootenberg Source: The Hispanic American Historical Review,

Price Levels Carnerosy Chunio: in Nineteenth-Century Peru

other dark Perurelegacies, nineteenth-century

7. Archivode la Beneficencia Publicade Lima (hereafter ABPL), Librosde los Hospi-

Variations in productqualitywere also not a problem.Most superiorqualitydesigna-

I: Indices ofKey Food Groups(1830 = 100)

Item/year Mutton Poultry Lard Rice Beans

181415 94m 82 208 85 100

181920 lO1m 101 364 132 100

182223 130m 190 272

1826 1827 100

103 123 (90) 91 106 119 102

89 265 93 83 125 201

89 294 108 75 105 183 97

(89) 224 90 105 99 165 101

Sugar Bread/flour Others

89 103 171 229 167/135w 116/439w 134/772w 96 105 132 112

100 100 100 100 100

86 90 97 150 63 94 76 99 100 109

(100) 102 (108) (100) 1840 66 80 79 168 68 60 64 106 125 85

100 100 100 100 100 1841 67 80 79 113 63 60 76 112 125 88

81 71 114 100 94 1842 64 81 79 116 63 60 75 111 (125) 88

98 81 124 111 108

(88) 60 178 (113) 116 1849 80 78 105 112 100 54 67 90 100 81

104 182 152 104 1850 85 82 109 116 92 55 85 74 100 89

93 160 150 132 1851 84 82 116 133 64

1847 (61) 77 (105) 116 56 44 77 134 (96) 83

Noodles Sugar Bread/flour Cookingfuel Others

Item/year Mutton Beef Poultry Rice

89 46? (60) 67 75 107

123 209 63 139 78 114

111 (209) 56 103 73 114

(111) 50 108 80 114

1864 183 (200) 157 97 166 105 70 116 135

1865 177 204 232 83 261 65 104 73 (116) 137

1871 289 (190) 217 154 218 100 172 65

106 78 146 115

(106) (78) (146) (115)

194 173 213 85 150 59

(194) (173) (213) (150) (59) (101)

II: ModernExpenditure Weights (Lima/Callao,1957)

III: Artisan Diet Weights, 1869

Totals 1,705 gramsat 35.5 centavos

IV: Lima Consumption Expenditures in 1837

Cost ofLivingWeights V: Nineteenth-Century

VI: RetailFood Price Index,Lima, 1800-73 (1830 = 100)

Further weighted 113.0 108.6 111.7

Further weighted 96.6 94.2

witha continuing 1822. A rapid stabilization followed, deflation in the

VII: Textileand RentIndices

I FEBRUARY I PAUL GOOTENBERG

General Inflation Index

FIGURE 1: Price Levels in Peru, 1800-73 (1930 = ioo)

I FEBRUARY I PAUL GOOTENBERG

49. Quiroz, La deuda defraudada,113-119, foran informative and incisivereviewof

a more direct result of an ad valorem free-tradepolicy (1852 . . .) in an

a100 10' .t1

ar~~~~ ct ~~~ ci ~~~~~~ ~co

00 ClClCO 1 CO CO C CCO Cl NCO CO01 Cl t

1r)1) 1) ooo oo00

tC 1) s C. Cc :sC Cc C. sC o oooo o oooo

cod Q~~~ c Q~~~~~~~~~~~~~~~~ >

Das könnte Ihnen auch gefallen

ar~~ ct ~ ci ~~~~~~ ~co

cod Q~ c Q~~~~~~~~~~~~~~ >