Copper Prices and Heterogeneity: The Chilean and Norwegian Cases, 1850–1913

As a first approach to the comparison between the Andean and the Nordic countries, it is their specialisation on natural resource exportation. But even though both regions exported similar commodities at the beginning of the nineteenth century, how similar were they really? In this article, we analyse the copper exportation of Chile and Norway in order to see small differences that can have made a difference in the long-run evolution of these two countries. We review the international copper price indices available in the literature and we compare them with a new data set, from the Official Foreign Trade statistics of these two relevant copper producers, Chile and Norway. This data includes information on value-added and price/volume indicators incorporating differences in varieties, qualities and transport costs. Our main contribution is that if the previous series are based on the assumption that copper is a homogeneous and standard product, and therefore it has one single international price, in the real world many different qualities as well as levels of processing were included into the production of each particular country, changing it also over time. Those varieties of copper would have mattered crucially for its implications on growth. The deepest knowledge on commodity price formation would improve forecasting for development policies on the mining sector.