Introduction
In economic terms, Argentina is a special case. It occupies a central place in accounts of economic history and financial newspaper headlines. The beginning of the 21st century saw Argentina's longest and largest economic crisis, which has been followed by recovery and expansion at rates of economic growth equalling those of China.
This recovery has reopened the debate on Argentina's long-term development strategy. Several authors emphasize the need to strengthen and promote Argentina's non-traditional tradable sectors, to consolidate the recent economic process and to finally overcome Argentina's recurrent internal and external imbalances (Gerchunoff and Ramos, 2005; Kacef, 2004; Porta, 2005).
Between 2003 and 2008 positive international conditions and the competitive exchange rate policy followed by the government are both said to have encouraged strong macroeconomic fundamentals in Argentina (see Serino 2007). The implications of global conditions and the exchange rate policy for productive and export diversification, however, need to be discussed in more detail – especially as Argentina's structural features, commonly overlooked in aggregate macroeconomic studies, do play a role.
Discussion of productive diversification in Argentina and the impact of natural resource shocks and policies hypothesized in this research, needs to take account of one of the country's most important structural features: a resource sector whose natural advantages make it more competitive internationally than other tradable sectors, and which produces wage-goods that are exported and consumed domestically. These structural characteristics matter for two reasons.