The ideas of young Prebisch

Prebisch arrived at ECLA for the first time in 1949, to
write a report in which he set out his views on the main
problems then facing the economic development of
Latin America (Prebisch, 1949);. As he had been hired
as an outside consultant, he did not receive the support
of other members of the institution in its preparation,
nor did he have much time at his disposal, so that the
report was a reflection of the ideas he already held prior
to joining ECLA. As the content of that work made a
great impact on academic and political circles in the
region and came to be considered one of the basic pillars
of structuralist thinking, it has often been wondered
when and why Prebisch incorporated those ideas into
his thinking.
In 1949 Prebisch already had a lengthy career as
an academic and public official behind him and was,
according to Furtado, "the only Latin American
economist with an international reputation" (Furtado,
1985, p. 58);. His first works date from the1920s, and
the general opinion is that in those years he was a firm
supporter of neoclassical ideas, but there is very little
in them that could have served as a basis for the 1949
report, and only as a result of the crisis that began in
1929 does he appear to have begun to abandon his
neoclassical views and to look for new interpretations
of the economic process and heterodox policies for
reshaping it. The fact that Prebisch often confirmed
this simple division of his thinking into two periods
must have been one of the main reasons why this was
accepted without question and a deeper study was not
made of his thinking in the 1920s (Prebisch, 1983);.
Attentive reading of the material he wrote during those years, however, shows
that the continuity of his ideas was much greater than has been assumed, so
that it would be very simplistic to divide the evolution of his thinking into
two periods -orthodox and heterodox- separated by the 1929 crisis. Prebisch
himself, when going into greater detail, recognized that the 1920s had not been
a period of pure orthodoxy for him. For example, when referring in an interview
to the first articles he had written, he said "In those articles I tried to
interpret actual phenomena with my own eyes, and not with economic theories
from outside. I attached great importance to the balance of payments... I began
to understand Argentina's external vulnerability at that
moment. This was between 1921 and 1923" (González
and Pollock, 1991, p. 458);. The fact that Prebisch often
confirmed this simple division into two clearly opposed
periods must have led those who have studied his
thinking to take this for granted, with the already
mentioned result that they did not study his thinking
during the 1920s in greater depth.
The aim of this article, therefore, is to show that
even from his first works, written in 1920, Prebisch
began to shape the body of ideas that he formulated as
a whole when he arrived at ECLA in 1949, and also that
he did not need to go through the experience of the
1929 crisis in order to become aware of the defects of
the primary export pattern, since these had already been
clear to him even in the early 1920s, when the Argentine
economic process was considered a shining example
of successful growth. The brutal impact of the crisis
merely served to confirm to him that he had not been
mistaken about those defects and to lead him to
definitively abandon his confidence in the Gold
Standard as a basic criterion for economic policy
management and seek new ways that would permit an
improvement in the standard of living of the population.