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Uruguay owes its origins to its close proximity to Buenos Aires, and the city of Montevideo, Uruguay's capital. Montevideo was only founded in 1726, the newest capital in Latin America. Very little is known about the life of the Charrúa, the native people. The Uruguayan population consists largely of descendents of Spanish and Italian settlers, with a distinct French influence. This has led to intense interest in horse riding and rodeos, with gaucho culture being very popular as a literary and also a historical theme. Bullfighting in Uruguay has been illegal since 1865.

Uruguay is a relatively wealthy country and supports a welfare state with good social services. With more than a third of the country's population living in Montevideo, Uruguayan society reflects this wealthier and more urban lifestyle. There are children's playgrounds around the city, with swings, slides, merry-go-rounds, sandboxes, and space for playing Hide-and-Seek, Hopscotch, and other games. With compulsory education for all, the literacy rate is at 98 percent, the highest in South America. There is a wide range of leisure activities. Playing music and listening to music have always been an important part of Uruguayan life. Tango music and culture are a part of both Uruguay and neighboring Argentina. Their music had its origins in the African slave community of Montevideo.

The introduction of soccer by the British changed the country dramatically, and the Uruguayan teams were the Olympic champions in 1924 and 1928. Montevideo hosted the first World Cup in 1930 at the country's main stadium, the Centenario, built for the event. The Uruguayan team won that year and became the world champions again in 1950. This has meant that boys all over the country play soccer in alleyways, courtyards, fields, and soccer fields. Although tennis, basketball, hockey, and rugby have their adherents, they do not come anywhere near soccer in terms of its universal appeal in the country. There were even two cricket clubs: the Central Uruguay Railway Cricket Club (later Penarol) and the Montevideo Cricket Club, both with largely British members and supporters. With many migrants from Catalonia, and also from the Basque country, pelota is played in Uruguay, especially in rural parts of the country.

Card games and Chess are popular in the country, with Uruguay occasionally fielding Chess teams in regional and international tournaments, and the game being promoted in schools by the Federación Uruguaya de Ajedrez. There were two local versions of the board game Monopoly. El Banquero had street names and neighborhoods in Montevideo, with the utilities being the phone company and the petrol company, and the train stations on the game replaced by buses, rail-buses, trains, and planes. A second version, Banco Mobiliario, features six transportation companies.

Making models, especially trains, boats, cars, and planes, is popular with boys and men—and there are many people working on making model railways in spite of all the trains in the country operating solely for freight. Hiking and cycling around the countryside have risen in popularity, and Jan Holzhauer wrote about the latter in his book West from Montevideo: Uruguay by Bike, in which he described his attempt to discover the Uruguayan countryside. Many wealthy Uruguayans go to Argentina or Brazil for adventure holidays, with Punta del Este, the beach resort, attracting people in search of the ocean.

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