The Liberal Republic, 1930–1945: Overcoming the Great Depression, the Rise of Interventionism, and Economic Slowdown

  • Ivan Luzardo-LunaEmail author
Part of the Palgrave Studies in Economic History book series (PEHS)


Between 1930 and 1945, Colombia initiated a process of industrialisation by import substitution, but it could not be completed as the industry did not expand enough into exporting. On the other hand, Mexico saw an accelerated industrialisation based on the textile industry, which developed by substituting imports in the 1930s, and was propelled by its exports to the United States during the Second World War.

Why did Colombia not follow the same path as Mexico? The answer lies in that, unlike the latter, Colombia was not able to absorb mass production technology on a larger scale. In this period, Colombia implemented economic reforms, which meant a mobilisation of resources towards one favoured sector: coffee. This fact led to a considerable underinvestment in the manufacturing industry and services.


Import-substitution industrialisation Economic slowdown Protectionism Mass production Textiles External debt Mexico 


  1. Avella, M. (2004). Antecedentes Históricos de la Deuda Colombiana. La Renegociación de la Deuda Externa de Colombia en los 1930 y 1940. Segunda Ronda: 1938–1942. Borradores de Economía, No. 293, Banco de la República.Google Scholar
  2. Bergoeing, R., Kehoe, P., Kehoe, T., & Soto, R. (2002). Policy-Driven Productivity in Chile and Mexico in the 1980s and 1990s. American Economic Review, 92, 16–21.CrossRefGoogle Scholar
  3. Bushnell, D. (1993). The Making of Modern Colombia: A Nation in Spite of Itself. Berkeley and Los Angeles: University of California Press.Google Scholar
  4. Cardenas, E. (2000). The Process of Accelerated Industrialization in Mexico, 1929–1982. In E. Cardenas, J. Ocampo, & R. Thorp (Eds.), An Economic History of Twentieth-Century Latin America. Volume 3: Industrialization and the State in Latin America. The Postwar Years. London: Palgrave Macmillan.Google Scholar
  5. Junguito, R. (2018). Cien Episodios de la Historia Económica de Colombia. Bogota: Ariel.Google Scholar
  6. Junguito, R., & Rincon, H. (2004). La Politica Fiscal en el siglo XX en Colombia. In M. Urrutia & E. Posada (Eds.), Investigaciones recientes sobre historia económica colombiana. Banco de la República Reportes del Emisor, No. 62.Google Scholar
  7. Kalmanovitz, S. (2017). Nueva Historia Económica de Colombia. Bogota: Universidad Jorge Tadeo Lozano.Google Scholar
  8. Maddison Project Database, Version 2018. Bolt, Jutta, Robert Inklaar, Herman de Jong and Jan Luiten van Zanden. (2018). Rebasing ‘Maddison’: New Income Comparisons and the Shape of Long-Run Economic Development. Retrieved from
  9. Meisel, A., Ramirez, M., & Jaramillo, J. (2018). Más de cien años de avances en el nivel de vida: El caso de Colombia. Cuadernos de Historia Económica, N.46. Banco de la Republica de Colombia.Google Scholar
  10. Montenegro, S. (1982). La industria textil en Colombia: 1900–1945. Desarrollo y Sociedad, N.8, Universidad de los Andes.Google Scholar
  11. MOxLAD. (n.d.). Montevideo-Oxford Latin America Economic History Database. Retrieved from
  12. Ocampo, J. (2015). Historia Económica de Colombia. Bogota: Fondo de Cultura Económica.Google Scholar
  13. Pachon, A., & Ramirez, M. T. (2006). La Infraestructura de Transporte en Colombia Durante el Siglo XX. Bogota: Fondo de Cultura Económica/Banco de la República.Google Scholar
  14. Prados de la Escosura, L. (2007). Inequality and Poverty in Latin America: A Long-Run Exploration. In T. Hatton, K. O’Rourke, & A. Taylor (Eds.), The New Comparative Economic History. Essays in Honor of Jeffrey G. Williamson. Cambridge, MA: The MIT Press.Google Scholar
  15. Urrutia, M., Pontón, A., & Posada, C. (2002). El Crecimiento Económico Colombiano En El Siglo XX. Bogotá: Fondo de Cultura Eonómica.Google Scholar

Copyright information

© The Author(s) 2019

Authors and Affiliations

  1. 1.London School of Economics and Political ScienceLondonUK

Personalised recommendations