1. Introduction Argentina is generally considered as the
recovery a decade later, the current structure
typical “middle-class country” in the Latin
and vulnerability of the Argentinean middle
America and Caribbean (LAC) region (De Riz,
class is a direct consequence of the long-term
2009). In the early 20th century, Argentina was
macroeconomic trajectory. The succession of
richer than most European countries1 and
inflationary crises has contributed greatly to
characterized by a large, strong middle class.
impoverishing the Argentinean middle class
However,
its
(Kessler and Di Virgilio, 2010; Galassi and
influence in the world economy during the rest
Gonzalez, 2012). The current crisis of public
of the century, and particularly after the 1970s
finance prompting a decline in GDP (-2.1% in
(Glaeser et al., 2018). Poor macroeconomic
2019) and significant price rise (53.5% in 2019) is
governance and high political instability are
another
alternatively mentioned in the literature as
vulnerability of the Argentinean middle class to
both the symptoms and explanations of the
macroeconomic
repeated cycles of short-term expansion and
pandemic has exacerbated the economic
contraction generating both severe inflation
recession (GDP dropped by 9.9% in 2020) and
crises
no
the
and
country
economic
gradually
lost
recessions
(Díaz-
good
doubt
the
illustration
of
conditions.
induced
the
The
great
COVID-19
lockdown
policy,
Alejandro, 1970; Alvaredo et al., 2018). As a result,
especially through its effects on labor market
Argentinean income per capita grew more
outcomes, has aggravated the situation of a
slowly than its Western European counterparts
large
over the second half of the 20th century (Taylor,
households which were left without welfare
2018). Argentinean growth has continued to be
protection. ECLAC (2021) estimated a 10-
hit hard by the macroeconomic cycle of boom
percentage points decline in employment and
and bust after the 1970s (Figure 1). In the highly
participation rates between 2019 and 2020 as
unfavorable macroeconomic context of the
well as a 2.5-point increase in unemployment
late 1990s, the currency board crisis finally
rate. Such negative labor market dynamics
prompted a major financial crisis in December
have
2001 that was to become the most severe
poverty and extreme poverty rates (rising
recession of the whole period (Alvaredo et al.,
respectively from 27.2% and 4.2% in 2019 to 37.0%
2018). Between 2001 and 2002, Argentinean GDP
and 5.4% in 2020), most of the increase being
contracted by 16%, unemployment soared to
due to downward mobility from the middle-
25%, and 5 million middle class people fell into
income stratum. According to the World Bank
poverty (De Riz, 2009). Even though the Peronist
projections (2021), the Argentinean middle-
Kirchner era in the 2000s coupled with a
income class (defined as those with daily
favorable
the
income between $13 and $70, 2011 PPP) would
commodities market marked a return of
have dropped from 51.1% in 2019 to 42.6-47.8% in
sustained growth and allowed a short-time
2020.
1
economic
context
on
This period is often called “The Belle Epoque” in the literature. See Sánchez (2016) for further information.
5
portion
of
subsequently
vulnerable
resulted
middle-class
in
increased
