The Political Economy of Agricultural Booms

Managing Soybean Production in Argentina, Brazil, and Paraguay

verfasst von: Mariano Turzi

Verlag: Springer International Publishing

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This book offers an in-depth analysis of the political economy of soybean production in Brazil, Argentina and Paraguay, by identifying the dominant private and public actors and control mechanisms that have given rise to a corporate-driven, vertically integrated system of regionalized agricultural production in the Southern Cone of South America. The current agricultural boom surrounding soybean production has been aided by aggressive new agro-technologies, including biotechnology, leading to massive organizational changes in the agricultural sector and a significant rise in the power of special interest groups and corporations. Despite having similar initial production conditions, the pattern of economic activity surrounding soybean production in Brazil, Argentina and Paraguay, continues to be largely determined by the needs of the multinational corporations involved, rather than national considerations of comparative advantage. The author uses these findings to argue that the new international model of agricultural production empowers chemical and trading multinational companies over national governments.

Inhaltsverzeichnis

Frontmatter

1. The International Political Economy of Agriculture

Abstract

Introduction of agriculture presents the analytical framework. It begins with an empirical, historical background on soybeans and the world soy market. It then proceeds to examine the literature on agriculture and its linkages to the economy, reviewing the main debates and recent contributions in the political economy of agriculture literature. The final section studies the several trends in global demand that have come together to intensify competition for agricultural resources and food products. World demand for agricultural commodities is driven by four factors (the “four f’s”): food, feed, fuel, and finance.

Mariano Turzi

2. A Super-Seeding Business

Abstract

The international political economy structure of agriculture is currently a corporate-driven, vertically integrated system of global production. This is the result of two mutually reinforcing traits: the technological transformation into agrochemicals and genetically modified (GM) seeds and the economic globalization of grain trading. The strategic value of a unique asset—GM seeds with proprietary traits—has propelled these companies to a dominant position. The power of input suppliers in the new soybean mode of production has given them overriding influence, allowing them to appropriate a sizeable portion of the rents generated along the chain. These multinational corporate actors have exerted their power to create the institutional structure to govern the new resource (GM soybeans).

Mariano Turzi

3. Global Trading

Abstract

Traders and processors have taken advantage of the grain trade liberalization of the last decade to leverage their position in open markets. They have concentrated supply mechanisms through the advantages derived from scale and vertical integration. Their strategies for furthering their position within the soybean chain have included infrastructure development, financial leveraging, and flexible sourcing. Further, they have drawn on their financial strengths to dictate tax structures and infrastructural developments, thus creating a pull force to rearrange the economic geography through the three countries.

Mariano Turzi

4. Coordination: Brazil

Abstract

The Brazilian case is one in which local governance is much stronger, which has allowed to effectively integrate state institutions with the resource/sector (coordination). The main issues determining political economy coalitions in the country are the Amazon and land tenure during the rule of Fernando Henrique Cardoso, Lula Da Silva and Dilma Rousseff. The Brazilian model of governance of the soybean complex has created institutional adaptation that incorporates agricultural interests into the decision-making process in a mutually reinforcing relation. This is seen through the rise of a new axis of agricultural governors and the bancada ruralista (agricultural congressional bloc).

Mariano Turzi

5. Colonization: Paraguay

Abstract

Paraguay exhibits a dire pattern of dual economies, where indigenous and landless peasants are systematically marginalized. The soybean model of production is secured institutional capture from private economic interests. In this case, there is a coalition of colonizing interests: MNCs and Brazilian and brasiguayo—Brazilian settlers in Paraguay and their descendants—landowners, overwhelmingly supported by the Paraguayan landlords. Although the formal structure is that of a unitary state, the agricultural sector has achieved de facto decentralization by state capture. Taking advantage of power asymmetries and weak initial institutional conditions, there has been colonization by particular and foreign interests. These are the determining factors of the political economy coalitions during the Lugo and Cartes administration.

Mariano Turzi

6. Confrontation (…and Beyond): Argentina

Abstract

Argentina is a case of centralized institutions exhibiting a conflictive pattern of relations with the economic sector/resource (confrontation). The soybean agricultural model of production is inherently opposed to the governing Argentine political economy configuration during that period: the labor/industrial/urban coalition on which the Peronist party built its ascendancy in Argentine politics. The three Kirchner governments (2003–2015) display a domineering and confrontational political style. Despite the recent governmental change—the election of Mauricio Macri in 2015—there is a built-in institutional imperative to exact rents still remains, and the agricultural sector remains a prime target.

Mariano Turzi

Backmatter

Titel: The Political Economy of Agricultural Booms
verfasst von: Mariano Turzi
Verlag: Springer International Publishing
Electronic ISBN: 978-3-319-45946-2
Print ISBN: 978-3-319-45945-5
DOI: https://doi.org/10.1007/978-3-319-45946-2

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Über dieses Buch

Inhaltsverzeichnis

Frontmatter

1. The International Political Economy of Agriculture

2. A Super-Seeding Business

3. Global Trading

4. Coordination: Brazil

5. Colonization: Paraguay

6. Confrontation (…and Beyond): Argentina

Backmatter

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