Raúl Prebisch was one of the leading personalities in the twentieth century and a key figure in Latin America's development, so it is perhaps surprising that until now there has been no major biography written about him. Edgar Dosman has filled this gap with a biography that is meticulously researched and a pleasure to read even if at the end we are still left with many unanswered questions about this enigmatic figure.
Prebisch was born in Tucumán, Argentina in 1901 to an immigrant father from Germany and an Argentine mother who, although relatively humble herself, was related to the Uriburu family – one of the grandest in the country. Prebisch was never fully accepted by these grandees, though he did benefit in a number of ways from the connection after he had established himself in Buenos Aires.
The move to the capital from Tucumán was due to higher education, and Prebisch displayed a precocious talent in the newly established economics department of Buenos Aires University. Prebisch's early publications while still at university brought him to the attention of the country's political and financial elite, however, and he never finished his studies, nor did he subsequently obtain a PhD. Thus, in many ways Prebisch was self-taught as an economist, and this may help to explain some of the ambiguities in his later research that have puzzled scholars of Latin American development.
Prebisch's early career was relentlessly orthodox, and he formed an early conviction – perhaps reinforced by the experience of his German relatives in the Weimar Republic – that inflation was a curse that needed to be eradicated at almost any cost. This may seem odd given his later association with a style of development that contributed to high rates of inflation in Latin America, but Dosman provides convincing evidence that right to the end Prebisch was deeply concerned about the damaging impact of inflation on the social and economic fabric of countries.
Prebisch's conversion to heterodoxy was an extended affair that did not fully materialise until he had left Argentina after the military coup in 1943, by which time he had been running the Central Bank for several years since its foundation in the mid-1930s. Earlier, however, he had been part of the Argentine delegation to London that negotiated the 1933 Roca-Runciman Treaty which imposed quotas on Argentine beef exports to the UK and gave Britain trading privileges in Argentina. Dosman is particularly good on this episode, which opened Prebisch's eyes to the unequal nature of power relations in global affairs and marked the beginning of the end of Argentina's long period of export-led growth.
Prebisch always argued that the Roca-Runciman Treaty was the best that Argentina could have done under the circumstances, but he was regarded as a traitor by many nationalists. Thus, this episode also marked the beginning of Prebisch's intellectual journey from Argentine nationalist to Latin American internationalist. It was the 1943 coup and the rise of Perón to the presidency in 1946 that accelerated this process, however, as this period challenged so many of his long-held views about Argentina.
Events now moved fast – perhaps too fast for the good of Prebisch – and he found himself thrust into prominence on the international scene through his connections with leading figures in the United Nations in New York. He also began to travel in Latin America almost for the first time in his life. He was therefore a natural candidate to head the UN Economic Commission for Latin America and the Caribbean (ECLA/CEPAL, hereafter CEPAL) when it was established at the insistence of the Latin American states and over the opposition of the United States. He was not the first secretary-general, but this was more a formality than anything else.
Prebisch had very little time to produce the 1950 CEPAL Economic Survey for which he is justly famous. That he did so at all under the time constraints he faced is remarkable, but it does help to explain some of the theoretical gaps and intellectual inconsistencies in the CEPAL thesis. Dosman is excellent on the bureaucratic obstacles Prebisch had to overcome, but less impressive on the CEPAL thesis itself, which is not examined in as much depth as one would have liked. There is no comment, for example, on the empirical material Prebisch used to establish a secular declining trend in Latin America's terms of trade.
The first Economic Survey ushered in a brief golden age for CEPAL, which lasted only until the mid-1950s. The second survey, almost as famous as the first, was also produced under gruelling conditions, but Prebisch was now helped by the brilliant team of Latin American economists he had assembled around him at CEPAL's headquarters in Santiago, Chile. This included the Brazilian Celso Furtado, whose outstanding study on Mexico was not published by CEPAL at Prebisch's insistence (Furtado later had it published independently in Mexico). This act of professional jealousy, as Dosman sees it, was to cost CEPAL dear as it deprived the organisation of a natural successor to Prebisch at a time when the fall of Perón was tempting Prebisch back to Argentina.
Prebisch was one of the first to see the limitations of import-substituting industrialisation in a national context, and he tried to steer CEPAL in the direction of export promotion through his work on regional integration at the very end of the 1950s. This work was adopted by Latin American governments in an even more distorted form than the original CEPAL thesis itself, however. Disillusioned but with no natural successor, Prebisch was only too pleased to depart for Geneva in 1964 to head the United Nations Conference on Trade and Development. Once there, he tried with limited success to address the imbalances in global affairs that he had first recognised during the negotiations leading to the Roca-Runciman Treaty. He maintained his links with Santiago, however, through the Instituto Latinoamericano de Planificación Económica y Social (ILPES), which he had founded in 1962 and which existed semi-independently of CEPAL.
Dosman makes clear that many of the criticisms of Prebisch have been unfair. He was, as already stated, a strong opponent of inflation and a keen supporter of manufactured exports, yet the figure Dosman paints is not so much that of a prophet before his time than a brilliant international bureaucrat who never really had time to engage in the kind of scholarly research that might have helped to avoid the worst excesses of cepalismo. He was also perhaps too confident in his own abilities, and he managed the crucial succession issue at CEPAL very poorly.
This is an excellent biography in which the author demonstrates a good grasp of international economic policy, institutional complexity and basic psychology. It is also very good on Prebisch's formative years in Argentina and his career as an orthodox central banker. Dosman is less effective when dealing with the rest of Latin America, and there are a few jarring inaccuracies, yet it would be churlish to let these block one's enjoyment of a biography that surely Prebisch merits, even if he was not the towering figure that he seemed in the 1950s.
