Oil and Development in Venezuela during the Twentieth Century

Oil and Development in Venezuela during the Twentieth Century

Oil and Development in Venezuela during the Twentieth Century

Oil and Development in Venezuela during the Twentieth Century

Synopsis

This work is the only economic history of Venezuela written in English. In it, Salazar-Carrillo provides estimates that have not been published previously on the Venezuelan economy in general, and the oil component in particular. Evolution of the oil industry in Venezuela is covered in detail and the concept of the retained value of oil expenditures and tnvestment is developed. Recent government policies and the performance of the Venezuelan economy are evaluated, and export-oriented strategies are considered. The appropriateness of these plans in fostering economic development is discussed.

Excerpt

In the chapters that follow, the effects of the expansion of the oil industry on the other sectors of the Venezuelan economy and on the ultimate development of the country are explored. the analysis is divided into 8 periods: 1910-22, 1923-29, 1930-36, 1937-42, 1943-57, 1958-73, 1974-85, and 1986-90. the purpose of this time spacing is to separate periods in which the behavior of the industry, and of government policies (specifically those regarding oil), have been significantly different.

In each period, attention will be focused on the main contributions of petroleum to the economy of Venezuela. Four areas will be examined: foreign exchange proceeds, oil tax revenues, petroleum investment, and income expenditure generation. the combined total contribution of oil in each period, as indicated by the retained value of total expenditures, will then be examined. the total combined petroleum contribution will give an idea of the behavior of the positive contributions, which are not considered individually in this study. Finally, the relationship of the contribution of oil to investment and gross domestic product (GDP) in the nonpetroleum part of the economy will be analyzed and conclusions drawn as to the overall effects of oil on the economy.

During this period, the oil industry certainly had a rate of expansion and size that would qualify it as a potentially leading sector. On the other hand, the Venezuelan economy could be classified as a peripheral country with a pattern of trade and production based on primary activities, importing most of the industrial products it consumed. Thus, this empirical section can provide a partial test for the propositions stated in Chapter 2. in the remainder of this chapter, the methodological and procedural problems that were faced in this section of the study will be discussed. Most of the data that will be used in the study were developed directly in the course of research or existed in unpublished form in different sources. the figures have . . .

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