Vol II, 2023

Abstract: One of Romania’s challenges after the First World War was the political, social and, above all, economic modernization of the country. Economic modernization required adequate financing. It was a difficult moment for Romania. In 1920, numerous coins circulated in Transylvania, trade and transportation were partially blocked and industry no longer had any sales markets. The country’s finances had been exhausted by the war and agriculture was producing harvests that were below its potential. The members of the Ruling Council found an ingenious solution to raise and manage funds by founding the Agrarian Bank. My paper shows that its main goal was to implement the agrarian reform in Transylvania. The bank was financed by private investors, but also by the state through land expropriation and financial participation. Through an in-depth analysis of the bank’s activities in the interwar period, I show that the agrarian reform itself was seen at the time as a form of modernization, first of the ownership structure and then of agricultural technologies. The establishment of model farms, the financing of the purchase of modern agricultural machinery, the development of consumer networks and the industrialization of agricultural products were valued. At the same time, the bank pursued the goal of developing the cooperative movement in Transylvania, establishing ad hoc cooperatives and providing the cooperatives with loans in order to stimulate the entrepreneurial spirit of Romanian farmers. The bank gathered around it the most important personalities of the Transylvanian economy, it invested in office buildings necessary for complex operations, but at the same time, in order to attract young Romanians from other areas, it bought apartment buildings for rent. It invested in automobile and even railroad infrastructure. Various enterprises, including the leading sectors such as serum production, model farms, cooperatives and other related businesses were established. Unfortunately, the modernization ideas clashed with liberal policies, but also with the reality and inexperience of some workers. For this reason, the modernization projects were not successful.

Keywords: Agrarian Bank, Agricultural reform, Transylvania, Modernization