Economic history of Argentina reforms such as open trade. On 1 January 1992, a monetary reform replaced the austral with the peso at a rate of 10,000 australs for 1 peso. The cornerstone of the reform process was a currency board, under which the peso was fixed by law at par to the dollar, and the money supply restricted to the level of hard-currency reserves. A risky policy which meant at a later stage Argentina could not devalue. After a lag, inflation was tamed. With risk of devaluation apparently removed, capital poured in from abroad. GDP growth increased significantly and total employment rose steadily
Economic history of Argentina conditions. Urquiza, president of the Confederation, issued the 'law of differential rights', benefiting the ships trading with the ports of the Confederation and but not with Buenos Aires. The end of the civil wars provided the political and legal stability necessary to assert property rights and cut transaction costs, contributing to the huge inflows of capital and labour resources that built modern Argentina. In 1866 an attempt was made to stabilize the currency, by introducing a system of convertibility, which restricted the monetary authorities to issue paper currency only if it was fully backed by gold or convertible foreign currency.