Commerce and Industry in Nineteenth Century Paraguay: The Example ofYerba Mate

Abstract

Yerba mate, a primitive forest industry, demonstrates the interaction of private and state enterprise in nineteenth century Paraguay. A low capital investment industry based upon utilizing seasonal and unskilled labor,yerba matewas financed, collected, and sold by the private entrepreneur and the state. Demand for yerba in both internal and external markets assured satisfactory profits for businessmen, above average wages for laborers, and necessary revenues for government. As a major export of Paraguay from the end of the seventeenth century until the War of the Triple Alliance, The Great War of 1864-1870, yerba mate provides insight into government regulations, taxation, price controls, and foreign trade policies. Because of the significance of yerba mate for the Paraguayan economy, the state was involved in both production and trade, although government interest primarily assured revenues rather than state control. A description of the organization of the yerba mate industry and an analysis of government policies supports revisionist studies that the governments of José Gaspar de Francia, 1811-1840, Carlos Antonio López, 1844-1862, and Francisco Solano López, 1862-1870 were pragmatic and rational rather than dictatorial and monopolistic.

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