ABSTRACT
Foreign investment in Latin America became much more significant with the repeal of the British Corn Laws in 1846. Latin Americans wanted to take full advantage of the European appetite for their primary products, and new investment in mines, railroads, port facilities, and cities was part of the mid-nineteenth century push toward modernity. Investment from Europe stimulated the Latin American positivists and provided a sort of self-fulfilling prophecy for Latin American elites who uncritically accepted European advice, expertise, and investment. US investment in the region developed gradually, especially after the conclusion of World War I. The dynamic of investment changed dramatically. With the United States taking on empire status following the conclusion of the Spanish–American War in 1898, US economic commitment to the region increased dramatically. President William Taft spoke of “dollar diplomacy,” which meant that the power of Wall Street investment firms would be used—rather than the military—to reshape “small” countries in Central America and the Caribbean.
