The problem is that the two countries are starting from very different positions!
The big problem is geography. Poland is right next to Germany -- and by extension, the rest of the European Union. Argentina is next to Brazil. If Argentina had Mexico's location, then it would be in a much better position.
Relatedly, Poland became part of the European Union! That's a level of market access to a huge rich economy that Argentina just doesn't have. The EU brings three other benefits: a level of policy certainty, free labor migration, and dollops of European cash. Net transfers from the European Union averaged about 4% of GDP over the period -- that's the equivalent of American taxpayers handing Argentina about $24 billion per year.
In addition, Poles could emigrate freely. Lots of Argentines can in theory go to Spain or Italy, but it is not that easy (as Professor Abad can attest), and Italy just made it harder. Poland lost 7% of its population (and more of its labor force) in the first 10 years of membership. Those people eased pressure on the labor market. (Figure 1B, https://case-research.eu/app/uploads/2024/06/id_plik6336.pdf.)
The article you linked to is strange in one other respect: Poland in 1989 was a Communist state. Argentina has never been Communist. Argentina had many problems when Milei took over, but state ownership of the means of production was not one of them. Other than the railroads, you're talking mostly Aerolineas Argentinas and YPF. The latter has been well run since the 2012 nationalization and while the former was a rolling disaster, it really wasn't a big drag on the economy. The railroads are still a mess but you can have well-run state railroads (Spain) and badly-run private ones (the UK); it's a tricky sector to manage.
The upshot is that Poland could grow in the 1990s simply by properly managing its transition from central planning. Argentina, though, already has a market economy; it can't grow by changing something that it never been doing. (Perón was many things but he wasn't Stalin.)
There are a lot of other differences under the hood which make lessons from one only partially applicable to the other. If Argentina were next to the US, had been suffering under Communism, and had the prospect of an economic union with the United States -- i.e., if Argentina in 2025 looked like Poland in 1990 -- then I'd see the comparison! But none of that is true, sadly.
https://open.substack.com/pub/thiagodearagao/p/five-ways-cheap-oil-squeezes-the?r=2di31u&utm_medium=ios
Interesting.
I hope that Argentina, in the short to medium term, will emerge out of this mess much like post-Communist Poland: https://www.realclearmarkets.com/articles/2024/07/24/argentina_can_grow_by_following_the_poland_growth_model_1046708.html
The problem is that the two countries are starting from very different positions!
The big problem is geography. Poland is right next to Germany -- and by extension, the rest of the European Union. Argentina is next to Brazil. If Argentina had Mexico's location, then it would be in a much better position.
Relatedly, Poland became part of the European Union! That's a level of market access to a huge rich economy that Argentina just doesn't have. The EU brings three other benefits: a level of policy certainty, free labor migration, and dollops of European cash. Net transfers from the European Union averaged about 4% of GDP over the period -- that's the equivalent of American taxpayers handing Argentina about $24 billion per year.
In addition, Poles could emigrate freely. Lots of Argentines can in theory go to Spain or Italy, but it is not that easy (as Professor Abad can attest), and Italy just made it harder. Poland lost 7% of its population (and more of its labor force) in the first 10 years of membership. Those people eased pressure on the labor market. (Figure 1B, https://case-research.eu/app/uploads/2024/06/id_plik6336.pdf.)
The article you linked to is strange in one other respect: Poland in 1989 was a Communist state. Argentina has never been Communist. Argentina had many problems when Milei took over, but state ownership of the means of production was not one of them. Other than the railroads, you're talking mostly Aerolineas Argentinas and YPF. The latter has been well run since the 2012 nationalization and while the former was a rolling disaster, it really wasn't a big drag on the economy. The railroads are still a mess but you can have well-run state railroads (Spain) and badly-run private ones (the UK); it's a tricky sector to manage.
The upshot is that Poland could grow in the 1990s simply by properly managing its transition from central planning. Argentina, though, already has a market economy; it can't grow by changing something that it never been doing. (Perón was many things but he wasn't Stalin.)
There are a lot of other differences under the hood which make lessons from one only partially applicable to the other. If Argentina were next to the US, had been suffering under Communism, and had the prospect of an economic union with the United States -- i.e., if Argentina in 2025 looked like Poland in 1990 -- then I'd see the comparison! But none of that is true, sadly.