Private Capital Investment in Public Services Financing: The Case of the Municipal Districts of Antioquia (Colombia), 1912-1931

Abstract

In this paper I analyze the growth of credit that took place in many municipalities in the department of Antioquia (1912-1930). Credits were offered by a wealthy Brokerage House which at the time had abandoned foreign trade and was investing its profits in urban business and banking. Long time relations established with foreign banks allowed the commercial house to benefit from foreign loans, sums of money that were channeled to the region, and were intended to promote the development of public service infrastructure in rural areas. The article shows the flow of foreign capital into the region and the role played by financial intermediaries in Medellin which facilitated its entry into local financial circuits.