It was terms of trade, in the 1890s, with volatility
Nice review of J. Williamson's book "Trade and Poverty" in the new issue of the EJ.
While not exactly a ringing endorsement, the review made me want to read the book (which I probably should have already done.
Here's an excerpt:
Williamson's conclusions can be summarised as follows. First, the link between falling behind and globalisation is causal (p. 231). Second, changes in the external terms of trade matter much more for growth outcomes than most people recognise (p. 199) while the role of changing domestic fundamentals and, in particular, institutions has been exaggerated (p. 213). Third, if the goal was industrialisation and growth, the periphery needed smart tariff policies to foster skill-intensive sectors; in some countries, especially in Latin America, the politically driven policy response was, unfortunately, the wrong sort of protection (p. 229).
The rest of the review spells out why Williamson may be shortchanging the importance of institutions.
Hat tip to Justin S.