Regime Change in Argentina from 2023 to 2024
DOI:
https://doi.org/10.63207/vqtea641Keywords:
regime change, Argentina, inflation, interest-bearing monetary liabilities, fiscal dominance, country risk, economic activityAbstract
In December 2023, Argentina experienced a regime change following an electoral process in which the incumbent party lost the runoff election to the opposition. The incumbent candidate, Sergio Massa (UP: Unión por la Patria), obtained 44.31 percent of the vote, while Javier Milei (LLA: La Libertad Avanza) obtained 55.69 percent. Based on the campaign proposals, this outcome would imply a potential shift in the economic regime toward an economy more open to international trade and toward the elimination of the fiscal dominance that prevailed over the last two decades. The initial measures adopted by the new administration focused on monetary stabilization through a rapid halt in the growth of the monetary base, together with an interest-rate policy aimed at reducing the real value of the Central Bank’s interest-bearing liabilities. The objective of this paper is to provide empirical evidence on the relationship among monthly growth rates in the consumer price index (CPI), the stock of monetary liabilities of the Central Bank, the country risk index, and the Monthly Estimator of Economic Activity (EMAE). For illustrative purposes, the paper also presents a projection of the inflation rate under the hypothesis that the incumbent party had won the election, as well as a regime-change projection under the hypothesis that the new regime implements a stabilization plan with structural reforms similar to those of the 1990s.
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References
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Copyright (c) 2026 Roque B. Fernández (Autor/a)
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