Economics in Ciudad Dario: The Rise of the Liniero

Twenty-some years ago in Nicaragua, around the time when the Sandinistas lost power, there were businessmen who would travel from Managua to Ciudad Dario, to sell goods that could only be found in the capital.  These businessmen were known to make good money, and a few ambitious locals decided to copy the business.  They began to travel around the country, selling goods only found in bigger towns from the back of their pick-up trucks.  As time passed, they began to hire others to do the selling for them (these hires tended to travel by bus rather than by pick-up truck), and began to offer customers the option of paying in installments, thereby introducing the concept of credit.

These newly hired salesmen would be assigned a route (or line) to travel and be told to sell as much of their merchandise as possible.  They would also be instructed to return regularly to the houses where sales had been made, in order to collect payments.  Thus, the liniero, a traveling salesmen who sells everday products on credit, was born in Nicaragua.  Its birthplace: Ciudad Dario. (Liniero in Spansih literally means “liner,” in reference to the route the salesman must travel.)

The founding fathers of the linieros (those men driving around in pick-ups packed with random household products) made a fortune.  When they started hiring people to sell for them, those new hires began to make good money as well.  Suddenly, everyone in town wanted nothing else but to be a liniero.  And so began the great liniero craze in Ciudad Dario.  There was a time when almost everyone in town was a traveling salesmen.  When little children told their teachers they wanted to be linieros when they grew up.  When the unhappy few who were not linieros, would awake to a ghost town, everyone having packed up and left to work their route hours before the crack of down.  This was a time when Ciudad Dario became little more than a hotel town, somewhere people go simply to sleep.

The huge influx of linieros inevitably lowered the profit margins for the salesmen and the coordinators of the routes, to the point where people say being a liniero now-a-days is good enough to feed your family but not much more. Nevertheless,  twenty-years later it remains the dominant industry in town.  It is likely that around fifty percent of the workforce in Ciudad Dario earns their income by working as linieros.

Next installment in the series: How does the business work?