Impact of the Great Depression on Chile and Peru

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In the opening pages of her novel To Kill a Mockingbird, Harper Lee wrote these words: “There was no hurry, for there was nowhere to go, nothing to buy and no money to buy it with…but it was a time of vague optimism for some of the people: Maycomb County had recently been told that it had nothing to fear but fear itself.” Lee alludes to the seemingly inadequate reassurance that United States President Franklin D. Roosevelt provided during his inauguration speech at the onset of the Great Depression, while also describing the melancholy and hopelessness that many citizens felt. This sentiment, however, was not just confined to the United States—the impact of the Wall Street Crash of 1929 had also reverberated throughout Latin America, and very few countries escaped the ensuing economic depression unscathed, including the Latin American nations of Chile and Peru. However, while the Great Depression adversely affected the economy and politics of both Chile and Peru in the 1930s, its effects were longer-lasting and more severe in Chile than in Peru.
By the mid-nineteenth century, Chile had become a major leading producer of copper, and the Chilean defeat of Peru and Bolivia in the War of the Pacific in the late nineteenth century resulted in the conquest of additional nitrate mines. Through the exports of its copper and nitrates, Chile became one of the wealthiest countries in Latin America by 1910. After World War I, however, decline in demand for nitrates, which were used in the making of explosives as well as fertilizer, commenced, as explosives were generally no longer needed. In addition, the fabrication of a synthetic fertilizer by the Germans greatly increased competition with Chile and presaged the prospect of mass production ...

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