The Copper Smelting Company “Urmeneta y Errázuriz” of Chile: an Economic Profile, 1860–1880

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Abstract
The performance of the Chilean economy during the period between 1830 and 1879 can best be described as a case of “export-led growth.” For those fifty years, exports of raw materials and foodstuffs to North Atlantic markets, especially Britain, rose dramatically. Between 1844 and 1878 the value of exports increased five-fold from $6,087,023 (about £1.2 million) to $31,695,859. This represents an average annual rate of growth of five percent. During the same period annual fiscal income, largely generated by exports, grew from $3.3 million to $15.4 million. Mining products dominated the export sector and constituted between one-half and two-thirds of the total value of Chilean production during this period. The export of copper bars and ingots was particularly dynamic. It increased ten-fold from $1.2 million in 1844 to $13.0 million in 1878 growing, on average, at an annual rate of 7.2 percent. Expansion in the export of copper bars and ingots was especially significant between 1844 and 50. This was due to a series of technological innovations, market conditions, and fiscal measures including the introduction of new smelting methods using coal instead of firewood, state incentives to Chilean copper smelting, extremely low prices for copper ores in the British and Chilean markets, and the formation of large copper smelting companies in Chile.