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The Politics of Second Generation Reforms in Latin America
Abstract
What Does "Reform" Mean? More than a decade after market-oriented reforms were launched in al-most every Latin American country, the picture is not encouraging. Per capita growth reached almost 2 percent a year in the 1990s—a far cry from the dismal negative 0.7 percent during the "lost decade" of the 1980s—but hopes have been dashed nonetheless. Only Chile managed to achieve "Asian" rates of growth during the 1990s. In other countries—Argentina and Mexico are good examples—vigorous growth spurts have been fol-lowed by periods of stagnation or decline. Huge budget deficits and hy-perinflation are a thing of the past (one hopes), but low investment and dismal public services are not. Income distribution has not worsened, but it has not improved either; Latin America remains the world champion of inequality. Prescriptions differ, but most observers agree that the time has come for a new round of policy reforms in the region.
... 18 Para un tratamiento más general de estos temas, véase Navia, P. y Velasco, A. (2003), "The Politics of Second Generation Reforms", en Kuczynski, P. y Williamson, J. (eds.), After the Washington Consensus, Instituto de Economía Internacional, Washington DC. ...
... After the Washington Consensus, Instituto de Economía Internacional, Washington DC. 19 Véase Navia, P. y Velasco, A. (2003), op cit. ...
... 26 Véase Navia, P. y Velasco, A. (2003), op. cit. ...
La década de los noventa impuso grandes desafíos en términos del diseño y aplicación de políticas públicas para el desarrollo tanto a nivel global como en América Latina. En ese contexto, el Banco Mundial se propuso publicar un libro que recopilara las experiencias personales de líderes de distintos países con el fin de extraer lecciones.
Como ex ministro de Hacienda y jefe del equipo económico tuve el privilegio de ser invitado a escribir un texto que formó parte del libro Development Challenges in the 1990s: Leading Policy Makers Speak from Experience.
En el marco del PROGRAMA CIEPLAN-UTALCA estamos publicando el presente ensayo que es una versión actualizada de aquel trabajo. El reciente fallecimiento del ex Presidente Patricio Aylwin nos ha impulsado a mirar en retrospectiva el difícil período que Chile tuvo que enfrentar durante el primer gobierno democráticamente electo después de 17 años de régimen militar.
El texto –centrado en el período 1990-1994– incluye algunas lecciones que tienen plena vigencia hoy en día y que podrían ser útiles para aquellos que deben liderar procesos de modernización en países en desarrollo, pero también para quienes quieran revisar la historia reciente de nuestro país.
... The international lending community is on full alert that it will be particularly difficult for these nations to successfully replace lost trade tax revenue; much of their operational funding and research is now focused on this issue (Carstens 2005;Cotarelli 2011). While IFIs such as the IMF discussed domestic tax reform as part of structural adjustment policies in the late 1980s and early 1990s (see IMF 1989 for example), political challenges in many nations have delayed these reforms and made them an integral aspect of current 'second generation reforms' (Navia and Velasco 2003;Naim 1994). 3 As recently stated by the IMF deputy managing director (2003À2006) Agust ın Carstens: ...
... However, these analyses cover a relatively short-time frame post-liberalization (1993À2001 and 1955À1976, respectively) and do not consider if and how international market pressures or political variables might mediate the impact of IMF tax assistance. Killick, Malik, and Manuel (1992) and Conway (1994) analyze the effect of IMF loans on a country's overall budget balance, but not revenue generation per se. 3. The distinction between the first and second stage of these IFI directed reforms in developing countries are that the first stage consisted of macroeconomic reforms of privatizing, liberalizing, and deregulating and the second stage involves more complex reforms of the state, thereby involving both political and institutional development (see Naim 1994 andNavia andVelasco 2003). Examples of the second generation adjustments include reforms to the civil service, labor market, delivery of public services, and tax collection. ...
... However, these analyses cover a relatively short-time frame post-liberalization (1993À2001 and 1955À1976, respectively) and do not consider if and how international market pressures or political variables might mediate the impact of IMF tax assistance. Killick, Malik, and Manuel (1992) and Conway (1994) analyze the effect of IMF loans on a country's overall budget balance, but not revenue generation per se. 3. The distinction between the first and second stage of these IFI directed reforms in developing countries are that the first stage consisted of macroeconomic reforms of privatizing, liberalizing, and deregulating and the second stage involves more complex reforms of the state, thereby involving both political and institutional development (see Naim 1994 andNavia andVelasco 2003). Examples of the second generation adjustments include reforms to the civil service, labor market, delivery of public services, and tax collection. ...
Developing countries are being confronted with severe fiscal challenges in the global economy. Over the last two decades, governments have been accepting significant reductions in trade taxes to support trade liberalization. This is particularly problematic for developing economies because trade taxes have been a key source of government revenues. In this paper, we investigate the conditions under which international financial institutions (IFIs) successfully assist developing countries with recovering the lost revenue from trade liberalization by implementing various domestic tax reforms. We argue that regime type mediates the effectiveness of IFI assistance in developing economies, after trade reforms have been adopted. More specifically, IFIs will be more effective at assisting authoritarian regimes with domestic tax reforms as a substitute for trade taxes than they will be in poor democracies. Democratically elected leaders inadvertently undermine multilateral assistance with tax reforms because they are more susceptible to middle- and upper-class demands for lower taxes in a competitive global economy. In authoritarian regimes, on the other hand, IFIs such as the World Bank and International Monetary Fund tend to be more effective because dictators are likely to experience far fewer political consequences for accepting IFI assistance and implementing tax reform in the global economy than their democratic counterparts.
... In this line of reasoning, they aim at adapting institutional frameworks and regulations for markets to work properly (IMF, 2004, p. 105). As a result, the political process required by second-generation reforms was more complicated and any reform attempt included a lengthy discussion and participation of all affected parties, whereby achieving a consensus became a sort of norm (Navia & Velasco, 2003;Krueger, 2000). ...
... For example, the literature shows that left-oriented governments attach more weight to equity, which has a key role in the reform of the labour market (Castanheira et al., 2006). However, even in the case when reforms were to be identical, they would be differently perceived in the eyes of the voters if they were promoted by left-or right-oriented governments (Navia & Velasco, 2003). In order to capture the ideology effect, the analyses in previous research included a dummy variable that takes the value 1 if reforms are carried out by a left-oriented government and the value 0 in all other cases, and the obtained results mostly show that countries in which the left-oriented party is in power is characterised by smaller reform activity. ...
The purpose of this paper is to explore the factors affecting reform patterns in Croatia in order to identify the main reasons for the (missing) reform success so far. The focus is on the analysis of the political system, especially on government fragmentation as one of the main features of proportional electoral rule and clientelism. In addition to political variables, economic factors are analysed as well. The obtained results show that reforms in Croatia were implemented during crises, that coalition governments are not conducive to reforms and that clientelism and corruption present significant obstacles for reform implementation in Croatia. Moreover, the results show that political cycles also have a significant effect, with reform activity slowing down as elections approach. This article contributes to the burgeoning debate on reform implementation (in the post-socialist societies) from the political economy perspective.
... C'est grâce à la Banque Mondiale que les politiques d'ajustement économique et l'approche monétaire de la balance des paiements ont conduit à des 28 « … it represents an attempt to reinvent orthodoxy in the domain of economic ideas and ideology by a global policy community that is profoundly influenced by the US, the key international financial institutions (IFIs) over which it exerts such authority and Nous entendons par « réformes de première génération » les réformes économiques lancées à la suite de la crise de la dette extérieure latino-américaine, par le FMI et la Banque Mondiale, tandis que les réformes ayant une dimension plus institutionnelle, politique et sociale sont appelées les « réformes de seconde génération ». Navia et Velasco sont d'accord pour souligner que le terme de « réformes de seconde génération » appartient à M. Naím, qui l´a utilisé pour la première fois en 1994 dans l'objectif de caractériser les dimensions institutionnelles des réformes économiques mises en chantier en Amérique latine et ailleurs, à la suite des politiques d'ajustement et de stabilisation macroéconomique Navia & Velasco (2003); voir aussi Naím (1994) 29 . ...
... Néanmoins, tout le monde s'accorde sur le fait que les politiques du Washington Consensus ont provoqué des changements radicaux et par ailleurs que ces politiques d'ajustement et de stabilisation macroéconomique devaient être l'objet d'une rénovation (Navia & Velasco, 2003). De surcroît, il y avait aussi un accord sur le fait que les réformes structurelles de première génération représentaient une des conditions préalables pour relancer la croissance et le développement ; autrement dit, les réformes de seconde génération constituaient la continuation des réformes de première génération mais par d'autres moyens (Naím, 2000 Naím (1994) Le tableau souligne les priorités, les stratégies, les instruments, les acteurs, les impacts et les défis pour chacune des réformes structurelles. ...
La crise de la dette externe latino-américaine des années 1980 a consacré le passage du modèle d’industrialisation par substitution des importations à un modèle de développement fondé sur la libéralisation de l’économie. La transition est provoquée par les politiques d’ajustement et de stabilisation macro-économique du FMI. Ces mesures vont être poursuivies, consolidées et approfondies par la Banque Mondiale et la coopération internationale au développement, à travers des réformes structurelles qui vont provoquer des bouleversements au sein des Etats et des sociétés. Cela a généré un malaise social qui s’est traduit par des mobilisations dans presque tous les pays de la région. Ces mobilisations sociales contre l’ajustement et la réforme structurelle néolibérale ont donné lieu à de nouveaux discours politiques. Parmi eux, le Buen Vivir qui a été incorporé aux Constitutions bolivienne et équatorienne en 2008. Le Buen Vivir rassemble et synthétise les revendications pour un modèle de développement solidaire, écologique et dans lequel les droits fondamentaux des êtres humains, parmi lesquels le droit à la différence radicale, sont respectés. Le discours du Buen Vivir récupère les critiques formulées par le post-développement et la décroissance en les intégrant en une nouvelle dimension qui donne une nouvelle place à l’altérité en économie.
... The political economy literature has more recently turned its attention to the importance of further reforms---the so-called Second Generation Reform (SGRs) agenda---in order to advance productivity gains and competitiveness, as well as to improve living standards and human development (Navia and Velasco 2003;Sachs and Vial 2002;Pastor and Wise 1999;IMF 1999). To the extent that SGRs include institutional and human capital improvements, they may enhance innovation and technology absorption, both of which are essential inputs for economic development. ...
... As (Fergusson, 2006 Total Exports economy in the world creates economic opportunities, but also complex problems. These challenges coincide with Brazil's need to undertake deeper market reforms to complement and sustain the rules around the new trade issues (Pastor and Wise, 1998;Navia and Velasco, 2003) Modernizing reforms are needed, for example, to improve economic institutional structures, to enforce property rights, and to encourage more flexible rules for investment and to foster innovation. Broadly, Brazil will require a much-upgraded institutional and regulatory environment to succeed in a technologydriven world economy. ...
This dissertation discusses the political and economic forces, both external and
domestic, that have shaped Brazilian trade policy in the 1990s and 2000s. Marked by
concurrent multilateral and regional trade negotiations, the country has simultaneously
embraced orthodoxy and liberalization of the past, while also falling back on
protectionist practices. For instance, after implementing steep unilateral tariff cuts in
the late 1980s and early 1990s, trade policy has subsequently undergone only
piecemeal change; in fact, “industrial subsidies” were maintained and even reinforced
in the period 1988-2005. I analyze how the domestic institutional framework shaped
Brazil’s global strategy, swaying policymakers to opt for a regional integration
initiative (Mercosur) and a rigid negotiating position in the multilateral sphere (World
Trade Organization). At the same time, Brazil shirked its commitments with developed
countries in the context of the Free Trade Area of the Americas and the European
Union-Mercosur negotiations.
The methodological approach taken here is an interdisciplinary one which draws
on economics, international relations, and political science. I begin with a historicalcomparative
narrative concerning the choice of development models (eg. importsubstitution
industrialization), the nature of domestic economic institutions and
bureaucracies, and the interaction of both with powerful interest groups as determinants
of trade policy. Secondly, I explore the interaction between global forces, and Brazil’s
policy responses. I then conduct an econometric analysis using panel data which cover
ten industrial sectors over seventeen years, my goal being to explain two trade policy
variables – tariffs and subsidized loans. By applying the assumptions of neoclassical
x
trade theory (Heckscher-Ohlin and Ricardo-Viner), as well as those of the new growth
theories to the Brazilian case, my results show that collective action and factor
endowment variables explain patterns of trade protection/support in the country’s trade
policy over time. Finally, I discuss contemporary Brazilian trade policy decisions using
descriptive data
... Más de quince años después de la implementación de las reformas (y de sus mediocres resultados), los economistas que hablan de un "segundo consenso" y persisten en sus llamados a implementar subsecuentes "generaciones" de reformas estructurales, consideran que el efecto político de la tecnocracia está destinado a ser mucho más duradero con el paso del tiempo. Mientras que a finales de los ochenta y a principios de los noventa las crisis económicas hicieron posible que las reformas fueran adelantadas por el ejecutivo por medio de decretos de emergencia (emergency rule by decree) (Navia y Velasco 2003), hoy en día las políticas tecnocráticas suponen un encuentro más directo entre la tecnocracia y otros actores, como el sistema judicial (Navia y Velasco 2003). El creciente papel político de la tecnocracia en Colombia debe ser entonces analizado a la luz del debate mundial acerca de los efectos de las políticas de expertos sobre la democracia. ...
... Más de quince años después de la implementación de las reformas (y de sus mediocres resultados), los economistas que hablan de un "segundo consenso" y persisten en sus llamados a implementar subsecuentes "generaciones" de reformas estructurales, consideran que el efecto político de la tecnocracia está destinado a ser mucho más duradero con el paso del tiempo. Mientras que a finales de los ochenta y a principios de los noventa las crisis económicas hicieron posible que las reformas fueran adelantadas por el ejecutivo por medio de decretos de emergencia (emergency rule by decree) (Navia y Velasco 2003), hoy en día las políticas tecnocráticas suponen un encuentro más directo entre la tecnocracia y otros actores, como el sistema judicial (Navia y Velasco 2003). El creciente papel político de la tecnocracia en Colombia debe ser entonces analizado a la luz del debate mundial acerca de los efectos de las políticas de expertos sobre la democracia. ...
... The Concertación governments perfected the neoliberal state through reforms of second generation, including the modernisation of the state ) and its public services (Santiso 2001); the improvement of key systemic areas, like health and education (Navia and Velasco 2003); and the regulation of the new markets of privatised public services (Manzetti 2000). A consistent focus on poverty amelioration towards a progressive enlargement of a liberal welfare regime cf. ...
This chapter illustrates the patterns of material and ideological differentiation of the mass university system in Chile, in order to specify the experiences of political socialisation of mass intellectuality—constitutive of the non-bureaucratic basis of the bureaucracy. Drawing on statistical data and interviews with 28 academics from the diverse types of universities and from the disciplines of engineering, economics, law, education, humanities and social sciences, I illustrate variants of public professionalism as expectations of political leadership through professional work. The hierarchisation among elite and mass universities in accordance to the students’ class origins is conflated with ideological projects that predominate in the institutional direction and composition (degree of pluralism) of the respective academic communities, differentiating ideals of professionalism vis-à-vis the social and ideological segmentation of the university system. The 2011 student movement was articulated by students from the universities in which a stronger sense of public professionalism is instilled.
... The Concertación governments perfected the neoliberal state through reforms of second generation, including the modernisation of the state ) and its public services (Santiso 2001); the improvement of key systemic areas, like health and education (Navia and Velasco 2003); and the regulation of the new markets of privatised public services (Manzetti 2000). A consistent focus on poverty amelioration towards a progressive enlargement of a liberal welfare regime cf. ...
Available at https://link.springer.com/book/10.1007/978-3-030-77193-5?fbclid=IwAR23vWKWjCsZJ9mDna4vRSTti0faQ1hfHLOHfWi7d6sG3Mfm0PPotjVlWvg
“Fleet’s main contribution is to identify the key role played by a totally unexpected actor: a large mass of highly educated public servants, who are the product of the explosive expansion of education and for decades have also contested the neoliberal state from within.”
—Patricio Silva, Professor of Modern Latin American History, Leiden University, The Netherlands
“This highly original and readable study is going to re-invigorate debates on state theory and enliven current discourses on cognitive capitalism and the knowledge economy. The author's insightful investigation of the Chilean university student and secondary school student movements is eye-opening and vitally relevant to the current struggles in Chile and all of Latin America today.”
—Stefano Harney, Honorary Professor, Institute of Gender, Race, Sexuality and Social Justice, University of British Columbia, Canada
This book addresses the political effects of the massification of higher education and intellectual labor in the neoliberal state. Using the case of Chile, the author argues that public professionalism emerges in the mass university system, producing excesses of knowledge which infuse the state with political purpose at many levels. The emergence of the student movement in 2011, then the major social mobilization against the neoliberal state since the restoration of democracy in 1990, provided a clear manifestation of the politicization and ideological divisions of the mass university system. In conditions of mass intellectuality, public professionals mobilize their political affinities and links with society, eventually affecting the direction of state power, even against neoliberal policy. Through several interviews with academics, public professionals, and other documentary and statistical analyses, the book illustrates the different sites of political socialization and the ideological effectiveness of the emergent mass intellectuality of the neoliberal state.
Nicolas Fleet is Dean of Social, Legal and Economic Sciences at the Universidad Católica Silva Henríquez, Chile. He received his PhD in Sociology from the University of Cambridge, UK. His research focuses on political sociology and higher education.
... The Concertación governments perfected the neoliberal state through reforms of second generation, including the modernisation of the state ) and its public services (Santiso 2001); the improvement of key systemic areas, like health and education (Navia and Velasco 2003); and the regulation of the new markets of privatised public services (Manzetti 2000). A consistent focus on poverty amelioration towards a progressive enlargement of a liberal welfare regime cf. ...
This chapter concludes with the findings about the political affinities and state effects of mass intellectuality, as the ideological expression of the most expanding segment of the social structure in Chile. First, the divisions of the university system underlie the differentiation of public professionalism. Universities segmented for the elite and public-oriented mass universities produce expectations of political leadership through professional work. Such sites of politicisation were activated with the 2011 student movement to affirm the public value of intellectual work against neoliberalism. Second, the massification of professional work incorporates political affinities in the state, so changes of state policy take place through professional reconfigurations of the public administration. Third, the professionals’ autonomy in the state not only engenders effects of control but also of production of meaning linked to subaltern identities. Thereby, professionals might influence the direction of state policy, realising the state effect of the mass intellectuality. Last, the political effects of mass intellectuality are projected onto the crisis of the neoliberal state in Chile.
... The Concertación governments perfected the neoliberal state through reforms of second generation, including the modernisation of the state ) and its public services (Santiso 2001); the improvement of key systemic areas, like health and education (Navia and Velasco 2003); and the regulation of the new markets of privatised public services (Manzetti 2000). A consistent focus on poverty amelioration towards a progressive enlargement of a liberal welfare regime cf. ...
This chapter illustrates the autonomy and influence of public professionals in the Chilean neoliberal state. The narratives of professionals, both from dominant and subordinated roles of the state, share ideals of public professionalism that are constitutive of expectations of autonomy, oriented towards the subject of state work and that eventually embody the interests of state policy, in post-bureaucratic fashion. In the social/cultural ministries (gender, culture, and indigenous affairs, among others) the autonomous initiatives (excess) of public professionalism might produce effects of production of meaning linked to the representation of subaltern identities and social movements in the state. While technocratic knowledge exerted from the heights of the state is insufficient to respond to the demands of social movements, other hermeneutic and critical uses of knowledge mobilised by the subordinate state professionals have enabled the articulation with social struggles challenging the hierarchies and justifications of the neoliberal framework of the state.
... The Concertación governments perfected the neoliberal state through reforms of second generation, including the modernisation of the state ) and its public services (Santiso 2001); the improvement of key systemic areas, like health and education (Navia and Velasco 2003); and the regulation of the new markets of privatised public services (Manzetti 2000). A consistent focus on poverty amelioration towards a progressive enlargement of a liberal welfare regime cf. ...
The political affinities of mass intellectuality are observed within the trends of massification of the professional composition of the state and the reconfigurations that take place therein with the first changes of government coalition since the restoration of democracy in Chile. With original data, I analyse the period spanning from the first centre-left government of Bachelet (2006–2010), the change to the right-wing government of Piñera (2010–2014), and the return of the centre-left in 2014 with Bachelet’s second government. Looking at the distribution and turnover of the professionals in such unprecedented period of political alternation, the political alignments of engineers and economists with the right-wing and of sociologists/anthropologists with the centre-left illustrate the jurisdictional challenges and political alignments taking place in the professional composition of the state. In turn, the university of graduation underpins the ideological division of professional state work, specifying professional roles linked to particular interests of state power.
... The Concertación governments perfected the neoliberal state through reforms of second generation, including the modernisation of the state ) and its public services (Santiso 2001); the improvement of key systemic areas, like health and education (Navia and Velasco 2003); and the regulation of the new markets of privatised public services (Manzetti 2000). A consistent focus on poverty amelioration towards a progressive enlargement of a liberal welfare regime cf. ...
In this introduction, I present the scope of the research by discussing the political potential attached to the recent stage of rapid massification of the university system, which results in the emergence of a mass intellectuality of professional/intellectual workers. The concept of mass intellectuality is brought from the hypothesis of cognitive capitalism, which is empirically contextualised for the Chilean case. It refers both to the condition of massification of intellectual labour in society and to the professional subjectivities differentiated in the process, along with the hierarchies of the mass university system. The political potential of mass intellectuality is defined in the idea of public professionalism, which represents the differentiation of political roles within professional occupations. In the Chilean case, such political potential is analysed in the 2011 student movement, the professional configuration of the public administration, and the autonomy that professionals exert in the subaltern struggles of the neoliberal state.
... The Concertación governments perfected the neoliberal state through reforms of second generation, including the modernisation of the state ) and its public services (Santiso 2001); the improvement of key systemic areas, like health and education (Navia and Velasco 2003); and the regulation of the new markets of privatised public services (Manzetti 2000). A consistent focus on poverty amelioration towards a progressive enlargement of a liberal welfare regime cf. ...
This chapter discusses the organic links of public professionals with the class interests leading the historic transformations of the Chilean state since the 1930s. The autonomy of the Chilean state has been built upon specialised knowledge and the universities that have produced the public professionals of the state. As in the theoretical discussion from the previous chapter, a progressive separation with respect to the traditional bureaucracy (and the legal profession) took place with the advance of the developmental state and the incorporation of modern professions: engineers, economists, sociologists, and so on. In turn, the imposition of the neoliberal state since the 1980s elevated the technocratic administration into incontestable centre of state power. With the massification of professional work in the state since the 1990s, aligned to higher education expansion and the incorporation of new democratic demands, subaltern identities attain representation within the public administration and might also challenge the neoliberal direction of state power from within.
... The Concertación governments perfected the neoliberal state through reforms of second generation, including the modernisation of the state ) and its public services (Santiso 2001); the improvement of key systemic areas, like health and education (Navia and Velasco 2003); and the regulation of the new markets of privatised public services (Manzetti 2000). A consistent focus on poverty amelioration towards a progressive enlargement of a liberal welfare regime cf. ...
A sociological synthesis on the rationality of state autonomy is here attempted. The sequence of Weberian, functionalist, Marxist, institutionalist, and post-structuralist approaches reveals a general trend consisting in the transference of autonomy of the state from the rules of its bureaucratic organisation to the emancipation of its professionals from this framework. In the extreme, the post-bureaucracy reduces the autonomy of the state to the mundane practices of bureaucrats themselves. By bringing together post-structuralist and Marxist approaches, a broad take on the mass intellectuality of the state is sustained. The professional organisation in the state crystallises its links with the social structure by incorporating the social and ideological divisions of the mass university system. The autonomy of the state is not reducible to the knowledge of technocratic elites, but also hinges on the excesses of knowledge mobilised by the mass of public professionals, in representation of the social and political struggles taking place at the basis of the state itself.
... As a result, an increasing criticism of WC policies emerged and a search for their revision developed. Eventually, in order to respond to the criticisms, the World Bank incorporated some additional policies to its agenda in the 1990s, referred as PWC, which augmented and expanded the original policies (Naim, 1994(Naim, , 2000Rodrik, 2002Rodrik, , 2006. 2 Policies under PWC did not abandon the original policies, but rather tried to overcome their shortcomings by forming new regulatory institutions and adopting some social policies (Marangos, 2009;Navia & Velasco, 2003). While regulatory institutions are considered essential for smooth and effective functioning of the liberalized markets (Marangos, 2009), social policies are seen essential 'to reduce poverty and improve equity without sacrificing growth' (Birdsall, de la Torre, & Menezes, 2001, p. 3). ...
The AKP came to power in Turkey in 2002 after a devastating economic crisis and has since become a hegemonic party. Despite its neoliberal policies, its votes mostly come from the poorer echelons of the society. This article analyses the AKP as a prime example of ‘neoliberal populism' and argues that the AKP's social policies are the material sources of its neoliberal populism. There are, however, important contradictions in AKP’s social policies. First, they have mostly benefited informal sector workers, but have decreased the benefits of formal employees. Second, some of the social policies are programmatic and universal, but others are particularistic and clientelistic. Third, although social programmes and spending increased, the labour policies of AKP have decreased the power and conditions of labour. These social policy contradictions help AKP target the poor unorganized sections of the society, gain and maintain popularity among them and weaken opposition to its neoliberalism and authoritarianism.
... The Concertación governments perfected the neoliberal state through reforms of second generation, including the modernisation of the state ) and its public services (Santiso 2001); the improvement of key systemic areas, like health and education (Navia and Velasco 2003); and the regulation of the new markets of privatised public services (Manzetti 2000). A consistent focus on poverty amelioration towards a progressive enlargement of a liberal welfare regime cf. ...
How does the massification of higher education shape the neoliberal state in Chile? Our research looks at the state effects of the mass intellectuality spawned by the recent expansion of the university system. The significance of this group hinges on the dissemination of orientations of public professionalism, which attach political meaning to state work beyond the instrumental rationality typically attributed to the bureaucracy. While the massification of professional work is incorporated within the enlargement of the public administration, the universities as ideological apparatuses are articulated with the public administration as state apparatuses. The political consequences of mass higher education are manifested in the autonomy of a mass of public professionals in the state. The research is broken into two parts. Firstly, it deals with how the neoliberal transformation of higher education affects the ideological reproduction of a mass intellectuality. Drawing on public data and interviews with academics, the segmentation of the university system illustrates the differentiation of sites of political socialisation of professional work. Then, it looks at how the massification of professional work shapes the autonomous rationality of the state bureaucracy and relates to political change. With data produced from administrative information of the state personnel, the professionals’ positioning and rotation in the public administration are associated with the changes of governmental coalition in 2010-2014 – actually, the first changes of governmental coalition since the restoration of democracy in 1990. Complementarily, interviews with professional state workers discuss the effects of public professionalism on state policy. Three theses on the mass intellectuality of the state are formulated. First, the divisions of the university system underlie the differentiation of public professionalism. Universities segmented for the elite and also public-oriented mass universities socialise public professionalism as expectations of political leadership through professional work. In most cases, such sites of politicisation were activated with the 2011 student movement – as the largest social mobilisation in two decades – to affirm the public value of intellectual work against neoliberal policy. Second, the massification of professional work is not randomly distributed in the public administration but configures political affinities, both in dominant and subordinated roles, along with the changes of government. Expressing the condition of state autonomy in a stage of mass intellectuality, changes of state policy take place through reconfigurations of the professional composition of the public administration. Third, the professionals’ autonomy in the state not only engenders effects of control but also of production of meaning linked to the representation of subaltern identities. Thereby, professional workers might also influence the direction of state policy, consummating the political relevance of the mass intellectuality of the state.
... For instance, in lowincome countries, the improvement of food losses depends greatly on the implementation of technological innovations across the FSC, especially at the agricultural production and the postharvest handling and storage stages. Considering the low public expenditures on infrastructure and lack of financial support to the FSC participants, regulatory strategies system,); and of the environment in which private firms operate (more competition, better regulation, stronger property rights)" (Navia & Velasco, 2002). ...
The accelerated population growth and current environmental sustainability crisis have an acute negative effect on the production of qualitative and accessible food, especially in the developing world. The purpose of this paper is to identify and develop recommendations to reduce overall food losses developing countries which fit the circumstances of the involved actors in the food supply chains (FSCs). A systematic literature review was conducted to extract and classify relevant food loss mitigation strategies in developing countries in general, followed by a case studies conducted in Tanzania to establish the suitability of the proposed strategies in the literature and to identify possible synergies. This paper contributes to a new path of investigation through the identification and collection of food loss reduction strategies among the different reviewed articles and their validation with help of unbiased evidence from the case study. Furthermore, by generating recommendations for developing countries to mitigate food losses in their FSCs, this research creates a guideline for them to recognize the potential of their operations and adjust them accordingly.
... It was expected that these policies would stabilize the economy, increase productivity, strengthen economic institutions, and eventually make the Peruvian economy more competitive worldwide (Inter-American Development Bank, 2002). While some studies indicate that the negative consequences of these structural reforms disproportionally affected the most vulnerable populations in the region (Birdsall, de la Torre and Valencia Caicedo, 2010;Navia and Velasco, 2003), and especially poor women and their dependent children (Rocha et al., 1989;Tanski, 1994), other studies suggest that the remarkable growth observed in the twentyfirst century may have predominantly been the result of the macroeconomic adjustments implemented in the nineties in addition to a favorable international environment and prudent macroeconomic policies (Burbridge, 2013;Infante et al., 2014;IMF, 2013;Loayza, 2008). (DANE, 2014). ...
We examine families with children and the potential impact of changes in family structure on changes in income poverty between 2003 and 2012 in Colombia and Peru. Results show that although the types of families that are increasing—single-mother and cohabitingcouple families—are the ones most at risk economically, overall poverty did not increase. The story in both countries is one of declines in poverty being associated with improvement in economic conditions, with demographic change not having much relationship to the poverty trend. This result is partly explained by the fact that cohabiting-couple families, though they begin the period with relatively high poverty rates, end doing better economically in both countries. As a result, the rise in cohabitation does not seem to be increasing poverty. In contrast, although singlemother families show improvements in human capital and employment in both countries, in Colombia their poverty rates remain high.
... táblázat) még 10 olyan ponttal, amelyek lehetővé teszik az eredeti 10 pont továbbélését. A tőkemérleg liberalizálása például a makrogazdaság stabilitását szolgálja, a pénzügyi szabványok és szabályozók bevezetése pedig a kiszámíthatóbb bankszféra meghonosodását segíti [Navia-Velasco, 2003]. ...
A tanulmány a gazdasági- és kereskedelmi liberalizáció lehetséges módozataival foglalkozik. A liberalizációs fázisok és strukturális reformok általános
áttekintése után bemutatja az egyoldalú, többoldalú és regionális liberalizálás tendenciáit a globalizáció előrehaladásának tükrében; majd a XXI. század kereskedelempolitikai eszközei mellett ismerteti az első és második generációs reformokat; a kifelé és befelé irányuló iparosítási technikákat. Az írás
bemutatja a latin-amerikai régió, majd négy előzetesen megválasztott ország
által gazdaságuk liberalizálása mentén bejárt útvonalakat, összegezve az
elmúlt néhány évtized főbb reformcsomagjainak rövidebb vagy hosszabb
távú kimenetét; illetve a gazdaság növekedésére gyakorolt hatásukat.
... Its recent history, inaugurated in 1989 with the transition from a military dictatorship to a stable democratic regime, is a successful one. In contrast to many countries of the region, Chilean society experimented a notable macro economic expansion, sustained growth of social programs in education, pensions and health provision, and though a bit more slowly, important political reforms which deepened and consolidated democratic rules were achieved as well (Navia & Velasco, 2003). Most importantly for current purposes, with the democratic transition a highly institutionalized multi-party system rapidly consolidated (Mainwaring & Scully, 1995; Kitschelt et al., 2010). ...
Since the return of democracy in 1990, party identification has been declining steadily among the Chilean public. Very few studies have attempted to understand this process in a longitudinal perspective. We address this gap by studying the evolution of mass level partisanship through an age-period-cohort analysis applied to repeated cross sectional data from 1994 to 2014. Results from Bayesian random intercept models indicate the presence of significant and negative effects associated to all three elements of social change. First, strong period effects have shrunken the overall level of partisan identification, though with some noticeable setbacks during election years. Second, pronounced aging effects have reduced individuals' propensity to identify with a party as they become older. Lastly, we find significant cohort effects whereby each successive generation is less partisan. Consequently, the effects of all three sources of change have consistently pointed in the direction of extinguishing mass partisanship from Chilean society.
... Amorim Neto (2002) also illustrates that the coalition discipline of governing parties in Brazil decreases later in the president's term. Navia and Velasco (2003) emphasise how Chilean president Patricio Aylwin took advantage of his post-inaugural political capital to negotiate tax increases and labour reforms successfully with the conservative opposition. While evidence regarding the US has been mixed (Lockerbie et al. 1998;Canes-Wrone and de Marchi 2002), recent works on Colombia, and Paraguay have found the electoral cycle exerts a significant effect on the passage of executive-initiated legislation Cárdenas et al. 2006). ...
This paper examines the approval of government bills in Chile, evaluating the effect of presidential prerogatives and policy substance, and considering both bill-specific and contextual effects. The results show that presidential prerogatives over financial policy, as well as the ability to affect the congressional agenda through urgent bill scheduling, significantly influence government bill approval. As expected, government success is enhanced during the honeymoon period. However, changes in public approval of the president do not appear to exert a significant effect on the passage of presidential bills.
... The time trend variable in equation 3 is significantly negative, suggesting that it has become increasingly difficult to achieve the major objectives of economic policy loans. The political difficulties and increasing complexity of second-generation reforms vis-` a-vis the more self-implementing first generation programs provides a possible explanation for this result (see Navia and Velasco, 2003; Rodrik, 2006). Finally, equation 3 shows that the nonselection hazard comes in significantly negative, indicating that there are unobserved factors for which countries are selected into the program which negatively affect the overall outcome of the program. ...
This study investigates how government ideology matters for the success of World Bank economic policy loans, which typically support market-liberalizing reforms. A simple model predicts that World Bank staff will invest more effort in designing an economic policy loan when faced with a left-wing government. Empirically, estimates from a Heckman selection model show that the quality at entry of an economic policy loan is significantly higher for governments with a left-wing party orientation. This result is robust to changes in the sample, alternative measures of ideology, different estimation techniques and the inclusion of additional control variables. Next, robust findings from estimating a recursive triangular system of equations indicate that leftist governments comply more fully with loan agreements. Results also suggest that World Bank resources are more productive -- in terms of reform success -- in the design of policy operations than in their supervision. Anecdotal evidence from several country cases is consistent with the finding that left-wing governments receive higher quality loans.
... On the uses (and potential abuses) of "participatory" approaches to development research and policy, seeNarayan (1996),Robb (2001),Cooke andKothari (2001), and Brock and McGee (2002). ...
An analytic framework for tracing three waves of efforts to provide key public services in developing countries is provided. Persistent (though not universal) failure has been the product of (a) the imperatives of large bureaucracies to discount decisions that are inherently both discretionary and transaction-intensive (and thus less able to be codified and controlled), and (b) good and bad reasons for believing that, because modern bureaucracies underpin rich country prosperity now, simply adopting their institutional form elsewhere is the surest way of facilitating development. Contemporary debates regarding the merits of incorporating more “participatory” approaches into public service delivery are best understood in this context.
... Recent consideration of public policies highlights the need to move into second-generation reforms to make the structural reforms that have existed since the late 1980s effective. Unlike those in the past, the new measures would not avoid public regulation but would instead pursue "sensible legislation" so that government will function efficiently and engage in clear rules for taxation, adjudication of service, electoral reforms, and changes in tariff structures to complement unskilled labor (Naím, 1994;Navia & Velasco, 2003). What constitutes a major analytical contribution of second-generation reforms is the sober realization that they offer low political visibility and are not appealing to politicians seeking short-terms results. ...
Incl. bibl. references Stromquist describes the intellectual developments since the Comparative and International Education Society was formed in 1969 as an interdisciplinary, international effort to reach general principles of knowledge about schooling. The initial premise of many in the field that education policy and institutions had strong transformative power, she concludes, gave way to "recognition that education is one force among many-one that is sometimes exploited politically to promise more than it can deliver." [proquest]
... pressure on international institutions such as the International Development Research Centre (IDRC), International Institute for Environment and Development -America Latina (IIED-AL), United Nations Development Program (UNDP) and the Water Supply and Sanitation Program (WSP) to make water governance research in Latin America a top priority. My research on water cooperatives, as an alternative governance model, comes at a time when more forward looking practices in Latin America are at the forefront of the water policy debate (Basañes, 2002; Navia, 2001).Hardoy, 2006; Lobina, 2007; Mariana, 2006). This trend and the return to State water provisions and investment, has resulted in the Buenos Aires Metropolitan Area facing major changes and new challenges in the realm of water governance after struggling with the private sector ownership that had been in place since the early 1990s. ...
This thesis examines the concept of water cooperatives as an alternative model to create access, supply and manage water services in poor urban and peri urban areas. Two case studies from the Municipality of Moreno, Buenos Aires are presented in this thesis in order to account for the feasibility of the model. The primary data for this research is derived from participant observation, key informant interviews, household questionnaire-based interviews and archival research. The significance of researching water cooperatives is that they have traditionally been dismissed in regard to their potential of being a practical alternative to large water concessions and public run water services in the Global South. Research on alternatives such as water cooperatives is key, particularly in the face of growing de-privatization in the water sector in the province of Buenos Aires. The Buenos Aires Metropolitan Area is an important case study for research on water governance because it was intended to be the World Banks model for which other countries would strive to emulate when reforming and improving water services by means of private concessions. The first part of the thesis examines the political and social history of water cooperatives in Argentina and the effects of privatization on the cooperative model. The second part outlines the theoretical advantages and disadvantages of the governance model and positions these theories against the realities of an existing water cooperative and a poor peri-urban community that has a strong affinity for implementing the model in their community. The two case studies presented in this thesis help to elucidate why the water governance model is able to serve poor peri-urban communities that otherwise remain unserviced by the traditional public or private water governance models. This is significant if we are earnest about providing water and sanitation services to all.
... Evidence of how those factors influence the response of the electorate to economic policies is very scant, though in-depth case studies on Argentina and Venezuela by Corrales (2002) conditions. "Neoliberalism by surprise" may still be a good political strategy (Cukierman and Tommasi, 1998;Navia and Velasco, 2003). ...
(Disponible en idioma inglés únicamente) En este trabajo se evalúa la manera en que los resultados electorales tanto en comicios presidenciales como legislativos en América Latina se han visto afectados por la adopción de políticas económicas concebidas para mejorar la estabilidad macroeconómica y facilitar el funcionamiento de los mercados. La base de datos incluye 17 países latinoamericanos durante el período 1985-2002, y un total de 66 elecciones presidenciales y 81 legislativas. El conjunto de hipótesis que se pueden poner a prueba proviene de un repaso de la obra publicada y se estructura alrededor de la hipótesis de la economía del voto. Se descubre que (i) se recompensa al partido oficialista si se produce una baja de la inflación y, en menor medida, si aumenta la tasa de crecimiento; (ii) mientras más fragmentado o ideológicamente polarizado sea el sistema partidista, mayores serán las recompensas electorales que genere una reducción de la inflación o un aumento del crecimiento económico, (iii) los electores se interesan no sólo por los resultados económicos, sino también por algunas de las políticas adoptadas: aunque el electorado parece no tomar en cuenta cuestiones macroeconómicas tales como las políticas fiscales o cambiarias, es contrario a las políticas favorables al mercado, independientemente de los efectos que éstas puedan tener en el crecimiento o la inflación, y (iv) el electorado es más tolerante de las reformas a favor del mercado cuando el partido oficialista tiene una ideología más orientada al mercado. Estos resultados sugieren que a los partidos reformistas les ha salido caro adoptar reformas de mercado, salvo en aquellos casos en que las mismas se hayan acometido conjuntamente con políticas de estabilización en economías altamente inflacionarias.
... Since her estimates control for economic outcomes, however, this result implies that policy switches may still have a positive electoral pay-off if the new policies bring about a substantial improvement in economic conditions. " Neoliberalism by surprise " may still be a good political strategy (Cukierman and Tommasi, 1998; Navia and Velasco, 2003). A common theme in the literature on economic voting is the conditional character of voters' responses to economic outcomes and policies. ...
This paper assesses how electoral outcomes in both presidential and legislative elections in Latin America have been affected by the adoption of economic policies that seek to improve macroeconomic stability and facilitate the functioning of markets. The database includes 17 Latin American countries for the period 1985-2002, and a total of 66 presidential and 81 legislative elections. The set of testable hypotheses is derived from a review of the literature and is structured around the hypothesis of economic voting. It is found that (i) the incumbent’s party is rewarded for reductions in the rate of inflation and, to a lesser extent, for increases in the rate of growth; (ii) the more fragmented or ideologically polarized the party system, the higher the electoral rewards of reducing the inflation rate or raising the economic growth rate; (iii) voters care not only about economic outcomes, but also about some of the policies adopted: while the electorate seems blind to macroeconomic policies such as fiscal or exchange-rate policies, it is averse to pro-market policies, irrespective of their effects on growth or inflation; and (iv) the electorate is more tolerant of pro-market reforms when the incumbent’s party has a more market-oriented ideology. These results suggest that reforming parties have paid a hefty price for the adoption of pro-market reforms, except when such reforms have been undertaken in conjunction with stabilization policies in high-inflation economies.
This chapter evaluates the economic and political factors behind the Chilean miracle, focusing on Pinochet’s regime and the transition to democracy. The analysis indicates that Chile’s remarkable economic growth stemmed from a credible commitment to limit government predation continuously reinforced during the democratic administrations. Edwar presents two main findings. First, a positive influence of Pinochet on Chile’s economic miracle is overestimated, as economic growth during his regime performed below that of a synthetic control constructed from similar countries that mirrored Chile’s growth prior to Pinochet. Second, using the same method, Edwar assesses the impact of the transition to democracy on economic growth. The most noticeable divergence in growth begins with the transition to democracy, as Chile is compared with a counterfactual that tracks well the path before the plebiscite in 1988. These results suggest that long-term growth is driven by the implementation of reforms and the expectation that these will remain in place, as evidenced by Chile’s transition to democracy.
This paper seeks to show that in the aeronautical industry government policy is fundamental for its growth and development, with the intention of analyzing the challenges facing this industry in Mexico and exemplifying the importance in its positioning is a comparative exercise with Spain and Brazil. The findings show that the policies have been differentiated, in Brazil the central role of the State delineated the trajectory of this industry. For Spain it was decisive in the conversion of local industry to strategic sectors such as aeronautics. In the case of Mexico, different programs and institutions have been created that have facilitated the development of the industry, which led it to be an important exporter of aeroparts.
Los cambios suscitados en la región de América Latina como efecto de las políticas de ajuste
estructural y de la desvinculación del trabajo como eje de integración social, dan origen a
esta investigación que parte de cuestionar las premisas de la intervención social dirigida,
centrada exclusivamente en el concepto de desarrollo humano. Como alternativa se propone
una intervención social participativa que, desde una perspectiva epistémica, orientada por
las nociones de complejidad, inclusión e interdisciplinariedad, altere los factores generadores
de desigualdad y exclusión, e incida en la construcción de nuevas formas de representación
social y política.
En esta investigación se analiza la relación entre la liberalización financiera puesta en marcha durante el gobierno de Carlos Salinas de Gortari y la crisis económico-financiera de México en 1994-1995. Esta crisis se ha calificado como la primera crisis financiera del siglo XXI, es decir, la primera crisis financiera importante que golpea una economía con mercado emergente en el nuevo mundo de mercados financieros globalizados.
La polémica sobre la liberalización financiera del gobierno de Carlos Salinas se mantiene activa por sus implicaciones y por la persistencia de sus efectos hasta el presente. En este documento planteo que la crisis y la inestabilidad financiera son el producto directo de las reformas estructurales, en particular de la reforma financiera, implantadas durante ese gobierno.
El objetivo principal de la presente investigación doctoral consiste en encontrar respuestas a una cuestión bastante directa: ¿Qué papel desempeñó la reducción del perímetro regulatorio de los mercados financieros en la crisis de 1994-1995 en México? La hipótesis de investigación propuesta es que la desregulación financiera, en particular la apertura de la cuenta de capital y la desincorporación bancaria, suscitó la entrada masiva de capitales y el endeudamiento acelerado y excesivo del sector privado (empresas y bancos), los cuales contribuyeron de manera importante en la generación de las condiciones que llevaron a la crisis financiera de 1994-1995.
Currency crises have long constituted one of the most important sources of politicoeconomic
instability across middle-income emerging markets, with exchange rate pegs having
been identified as key culprits. Given pegs’ propensity for boom-bust-cycles, it is thus
puzzling that governments insist on implementing such constraining regimes and, more
importantly, that they tend to postpone exchange rate flexibilisation until a disorderly exit
becomes inevitable. This thesis addresses as its core puzzle exchange regime choice in middleincome
emerging markets in Latin America, and especially the phenomenon of ‘exchange rate
petrification’, by examining the tumultuous exchange rate history of Argentina and Brazil.
Adopting a qualitative approach and using comparisons between periods and countries, it
traces the process of exchange rate policymaking on the basis of participant interviews and
archival and media research over a period ranging from re-democratisation in the early 1980s,
through the decade of structural reforms under nominal exchange rate anchors in the 1990s
until the crisis exits to inflation-targeting under ‘dirty floats’ in the new millennium.
The study shows that existing studies, which narrowly focus on electoral opportunism,
credibility-building motivations or structurally-determined interest group pressures derived
from OECD contexts, fail to capture the reality of emerging market exchange rate politics,
their distinct economic structural context and the inter-relationship between exchange rate
policy and executives’ structural reform endeavours. Instead, the analysis suggests that only a
model of exchange rate politics that centres on intra-executive dynamics, but incorporates
their interplay with societal cleavages and the role of international financial institutions, can
account for the countries’ divergent exchange rate policy and especially the differential
severity of ‘exchange rate petrification’.
Using the cases of Argentina and Brazil as a backdrop, the thesis offers an explanation for the
problematic nature of exchange rate pegs that goes beyond the analysis offered by the
economics literature, and instead highlights their inherently political nature insofar as national
governments conceive of nominal pegs as coalition-building devices in the context of
politically controversial structural reforms. Aside from structural factors, such as liability
dollarisation, it is governments’ reluctance to surrender this political instrument that
perpetuates ‘exchange rate petrification’. As ‘exchange rate petrification’ presupposes the
absence of sustained exchange rate politicisation, the thesis also refines the literature’s
exchange rate politicisation hypothesis by incorporating several intervening variables, such as
the institutional structure of organised society, the nature of the political system and ideational
factors, which may mute calls for exchange regime change and thus generate permissive
circumstances for exchange rate pegs to petrify.
Este trabajo tiene como propósito central explorar hasta qué punto la intervención de Hábitat influye en el fortalecimiento del capital social en las comunidades beneficiarias. La información empírica que sirve de base para este análisis proviene de la “Encuesta de seguimiento de indicadores de resultados del programa Hábitat 2010” que fue levantada por El Colegio de la Frontera Norte, a través de un convenio de colaboración con la Unidad de Programas de Atención a la Pobreza Urbana de la Sedesol, entre los meses de agosto y octubre de ese año en una muestra de 176 polígonos, que se distribuyen en 33 ciudades o
zonas metropolitanas del país. Particularmente se hará uso de los resultados de la sección 7 del cuestionario en hogares dedicada íntegramente a investigar 5 dimensiones del capital social: grupos y redes, participación y cooperación, confianza y solidaridad, cohesión social, y comunicación e información.
El documento se divide en cinco secciones: en la primera se revisan los principales conceptos sobre capital social, tanto a nivel teórico como empírico, y a partir de ellos se explica la definición que fue desarrollada
por el equipo de investigación de El COLEF en el marco del proyecto “Evaluación de impacto del programa Hábitat 2008-2012”, que permitió su operativización en las 5 dimensiones ya mencionadas; en el segundo
apartado se establecen los alcances (o limitaciones) que se advierten en el diseño de Hábitat como instrumento para el fortalecimiento y expansión del capital social en las comunidades que forman parte de su población objetivo; en la tercera sección se presentan los resultados de la investigación a escala de barrio (o polígono), particularmente se describen los niveles que observan las 5 dimensiones y las 14 variables que componen el índice de capital social, así como los datos agregados que se observan entre los 176 polígonos de la muestra; en el cuarto subcapítulo se exploran algunos factores que pudieran tener efectos sobre la expansión del capital social a partir de la intervención de Hábitat; finalmente, en el último apartado se sistematizan las principales conclusiones del estudio incorporando una reflexión sobre la importancia del capital social en el desarrollo social comunitario.
Considerando que no sólo los factores económicos y financieros sino también los políticos han determinado, en las últimas décadas, el diseñó e implementación de la modernización económica a nivel mundial, el presente trabajo de investigación sostiene que el análisis del proyecto político de un mercado libre global es el elemento central para entender el origen, la naturaleza, la dinámica y las consecuencias de las reformas estructurales, en particular de la liberalización financiera.
In this paper, we argue and provide empirical evidence to support the claim that higher income differences across regions increase the salience of interregional redistribution and, as a result, crowd out policies aiming towards improvements in government quality or efficiency. In the presence of greater regional disparities, the balance of politics may tilt towards redistributive concerns and away from government efficiency considerations, especially since the latter can be opposed by organized public sector interest groups. Our empirical analysis, based on a sample of 22 Organization for Economic Co-operation and Development (OECD) countries over the period from the mid-1990s to 2005, supports our basic intuition that regional disparities may lead to territorially based redistributive conflict to the detriment of government quality.
Using a stochastic frontier’s methodology (cost and production functions), we have estimated efficient frontiers linking levels and functional categories of public expenditure (inputs) compared to standard social outcomes (outcomes): life expectancy, infant mortality, literacy rate, access to safe drinking water, and human development. The high significance of the models and parameters in general, in all estimations, demonstrates the important role that the size of the public sector has in obtaining certain levels of social achievement. However, it also shows that the social impact of public spending is quite improved in several aspects: in particular the public health expenditure is very inefficient. Using estimates of second order (taking efficiency scores as dependent variables) we found a positive correlation between public social efficiency, especially with the increase of the urban population, and to a lesser extent with the decentralization processes.
Governments can engage in budgetary social policy by financing income maintenance programs such as public pension, health insurance, and unemployment benefits or by providing social infrastructures and services such as public housing, education, health services. This study examines conditions under which a developing country’s government favors one mode over the other. I argue that the government would seek to prioritize the mode of social policy that is underprovided by the private sector, in order to maximize the marginal political returns from social spending. I then argue that the private sector’s welfare enhancement incentives and capabilities depends on the production and employment perspectives in the domestic economy, which is determined largely by the type of external financing it can access. Thus, the type of external financing to the private sector ultimately explains mode of social policy provision by the government. My analysis of 66 low and middle-income countries over a period between 1975-2006 finds that the greater reliance of a country’s economy on arm’s length finance is associated with the government’s prioritization of social infrastructures and services. Conversely, the greater reliance on relationship-based finance is associated with the government’s prioritization of income maintenance programs.
Structural adjustment is commonly prescribed as a condition for receiving loans from the World Bank and the International Monetary Fund, but the effects of structural adjustment and conditionality are controversial. While much research has been devoted to examining the economic effects of conditional lending, far fewer studies have looked at the political consequences. How do conditional lending agreements affect democracy? Does the number of required reforms or the type of reform play a role? Neoliberal theory suggests that improved economic conditions will result from structural adjustment, and over time this should lead to higher levels of democracy. Conversely, democratic practices may decline in the presence of conditionality as the government reduces civil liberties in an attempt to quell the social unrest that results from structural adjustment. Using a sample of Latin American countries from 1998 to 2003, this article analyzes the effects of both the number and type of required conditions on democracy and finds that while the presence of an IMF loan itself does not affect democracy, loan with a high number of required reforms have a deleterious effect on democratic practices. Further, these effects are conditional upon the type of reform required in the loan. This suggests that IMF efforts to consider the political consequences of reforms when negotiating loans have not been entirely successful and that the number and type of conditional requirements should be carefully considered before their inclusion in a loan agreement.
The Miami Summit launching the Free Trade Area of the Americas process recognized that free mar- kets and free societies work best when they work together. The core labor —standards freedom of asso- ciation and the right to organize and bargain collectively; freedom from forced labor; the abolition of child labor; and freedom from discrimination— are fundamental rights and, in an environment that promotes democracy and market-oriented economies, as the FTAA is intended to do, there is no tra- de-off between these principles and development; indeed, they become mutually reinforcing. A review of International Labor Organization information on implementation of core labor standards in the hemisphere suggests that there is substantial room for progress, including in export sectors. Recent de- velopments in the treatment of labor issues in US trade agreements also suggests that labor standards cannot be ignored if an FTAA agreement is to gain approval in the US Congress.
We quantify the role of financial frictions and the initial misallocation of resources in explaining development dynamics. Following a reform that triggers efficient reallocation of resources, our model economy with financial frictions converges slowly to the new steady state—it takes twice as long to cover half the distance to the steady state as the neoclassical growth model. Investment rates and total factor productivity start out low and rise over time. These model dynamics are endogenously determined by the extent of initial resource misallocation and the degree of financial frictions. We present data from post-war miracle economies on the evolution of macro aggregates, factor reallocation, and establishment size distribution, which support the aggregate and micro-level implications of our theory.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
In 1980, Venezuelan income per capita in dollars was 1.4 times higher than that of Colombia, but in 2007, this ratio was reversed and the Colombian income was 1.1 higher than that of Venezuela. This result deserves an explanation, as both countries made similar structural reforms to allow a free economy and to integrate with international markets. This paper aims to explain this result. The main conclusion is that the State-entrepreneur relationship and the real exchange rate management are crucial for the explanation of the difference in the economic performance of both countries.
Among the various educational models in Latin America that seek to increase parental participation in schooling, perhaps the most far-reaching is the experiment with self-managed schools. These are publicly funded schools administered by parents. Broad public powers, such as the capacity to decide the budget and make staffing decisions, are given to parents, many of whom have had very limited prior administrative experience. How does this policy innovation impact on civil society? Does parental participation in school administration empower participating citizens or strain civil society? There are various ways of answering these questions. This article looks at some possible ways to conceptualize and assess the relationship between parental participation in self-managed schools and civil society. The article draws from the experience of El Salvador, Guatemala, Honduras and Nicaragua, where these reforms have advanced significantly since the 1990s.
The term 'Washington Consensus', as Williamson conceived it, was the lowest common denominator of the reforms that he judged 'Washington' could agree were required in Latin America. The term has evolved to denote a different set of policies from those initially conceived. This paper investigates the different versions and interpretations of this controversial term and assesses whether the term itself is suitable and viable or slowly becoming irrelevant and obsolete. Most importantly, the evolution of the term mirrors the evolution of economic thought on economic development for nearly the last two decades. Copyright © 2009 The Author. Journal compilation © 2009 Blackwell Publishing Ltd.
La capacidad de los regímenes políticos para formular y ejecutar políticas que respondan al interés común parece ser un factor crucial para el desarrollo. A menudo las instituciones públicas en América Latina no están orientadas al bien común. En consecuencia, la mayoría de los países de la región carece de la preparación adecuada para enfrentar los desafíos de la integración en el mercado mundial y el desarrollo basado en el conocimiento. Dos enfoques se han abocado en especial a la relación entre las instituciones y el desarrollo: la buena gestión de los asuntos públicos o buena gobernanza (good governance), propuesta por el Banco Mundial, y la competitividad sistémica, introducida por el Instituto Alemán de Desarrollo. Echando mano a elementos de ambos enfoques, este artículo propone un marco conceptual para evaluar las tendencias de los sistemas políticos a bloquear o a promover las reformas. Este nuevo enfoque, denominado de gobernanza sistémica, se basa en la capacidad de tomar y aplicar decisiones en función del interés común, en todos los niveles del sistema político. Para promover reformas de segunda generación es preciso tener en cuenta el carácter sistémico de la gobernanza.
In 1980, Venezuelan income per capita in dollars was 1.4 times higher than that of Colombia, but in 2007, this ratio was reversed and the Colombian income was 1.1 higher than that of Venezuela. This result deserves an explanation, as both countries made similar structural reforms to allow a free economy and to integrate with international markets. This paper aims to explain this result. The main conclusion is that the State-entrepreneur relationship and the real exchange rate management are crucial for the explanation of the difference in the economic performance of both countries.
Brazilian presidents have had considerable success in getting their agendas approved in the congress, contrary to the conventional wisdom regarding the functioning of the Brazilian multiparty presidential system. They have succeeded by relying on the support of disciplined parties. The agenda powers held by the president and party leaders allow them to neutralize the personal vote and to obtain disciplined political support. An analysis of legislative output and roll call votes supports these conclusions.
Among the many countries that underwent transitions to democracy in recent decades, only Russia is as important to the United States and the world as Brazil. The fifth-largest country and population in the world, with nearly one-half the inhabitants of Latin America, Brazil has the worldâs ninth-richest economy. Given the nationâs size and influence, its capacity to achieve stable democracy and economic growth will have global impact. Understanding democracy in Brazil is therefore a crucial task, one which this book undertakes. Theoretically, the author argues that most party systems in the third wave of democratization, after 1974, have distinctive features that require us to reformulate theories about party systems generally; previous works have paid scant attention to the importance of variance in the degree of institutionalization of party systems. The author also argues that many third-wave cases underscore the need to focus on the capacity of the state and political elites to structure and restructure party systems from below. Empirically, the author studies the Brazilian party system and democratization, with particular reference to the 1979-96 period. He underscores the weakness of the party system and the resulting problems of democratization. He argues that the party system is poorly institutionalized, explores the reasons for the difficulties of party building, and addresses the consequences of weak institutionalization, which leads him to reaffirm the central significance of parties in the face of widespread skepticism about their importance.
The study of coalition formation has primarily focused on the analysis of parliamentary regimes. This article examines the dynamics of coalition formation and breakdown under presidential regimes using evidence from Uruguay (1989-99). Using logistic regression I show that while coalitions are more likely to form immediately after a presidential election, the probability of a political group remaining in an executive coalition decreases as the presidential term elapses. As a result, cycles of cooperation and stalemate among political actors are likely to occur. I also conclude that not only the prospects for political cooperation but also the likelihood of a given fraction leaving a governing coalition are explained by the following variables: ideological affinity between the president's fraction and another political group; presidential approval ratings; affiliation of a fraction with the president's party; proximity of the coming election; and the fairness of the coalition agreement.
What effect does provincial-level politics have on the ability of Argentine legislators to survive in office? We develop a game-theoretic model of incumbent renomination and derive two related hypotheses on the variation in the time a national deputy will survive in office. We argue that the brevity of Argentine congressional careers can be explained by the disproportional power held by local party leaders vis-a-vis incumbent legislators. Drawing upon a novel data set on the composition of the Argentine Chamber of Deputies between 1983 and 1997, our expectations are tested through censored Weibull regression. Our hypotheses are supported by the analysis. We find the probability of staying in the national congress decreases with the passage of time. The hazard is mitigated if a legislator occupies a leadership position in the legislature.
Since the mid-1980s a profound change of direction in the structural policies of the region has taken place. The development model based on protecting national markets and state intervention was replaced by a set of policies aimed primarily at seeking to improve efficiency, facilitate the operation of markets, and reduce the distorting effects of state intervention in economic activities. An earlier version of this article (Lora, 1997) was prompted by the absence up to that time of measurements of progress in reforms. As was then argued, the lack of direct measurements of structural policies had stood in the way of adequately evaluating the effects of the reforms on economic growth and other variables. The few studies that had attempted to analyze the effects of the reforms had used result variables, such as the foreign trade ratio of the economy, or the size of public spending, or financial depth, rather than policy variables, such as tariffs, tax rates, or reserve requirement ratios. The indices of reform that were proposed at that time served as the basis for various studies that analyzed the effects of the reforms and stimulated the construction of other reform indicators.
The 1980s began with many developing countries facing severe debt problems. Stabilization and structural adjustment policies were introduced by the IMF and the World Bank, as the conditions for obtaining loans. By 1985 some parts of the United Nations — notably the Economic Commission for Africa, the ILO and UNICEF — were drawing attention to the severe human costs which these policies involved, in terms of unemployment, child malnutrition and setbacks in education and health. The following piece was presented by Richard Jolly, then Deputy Executive Director of UNICEF on leave of absence from IDS, as the Barbara Ward memorial lecture at the 18th World Conference of the Society for International Development in Rome. It was an early presentation of the need for an alternative approach. Two years later, Giovanni Andrea Cornia, Frances Stewart and Richard Jolly, all at the time working for UNICEF, published their detailed analysis and country data in two volumes, also entitled Adjustment with A Human Face. Partly in response, the Bretton Woods Institutions made some changes to their policies, though far less than were necessary.
Presents studies from a research project on the political economy of structural adjustment in the context of democratisation and political liberalisation. The crucial link between political and economic reform is illustrated with case studies of Chile, Mexico, Nigeria, Poland, Senegal, Spain, Thailand and Turkey. The studies focus on two clusters of policies as outcomes of interactions among politicians, bureaucrats, and interest groups: monetary and fiscal controls, and trade and exchange rate mechanisms. They also look at the evolving institutional context in each country. It is argued that conflicts between pluralist politics and growth-promoting economic policies can be resolved, and that adjustment is not complete until the public has voted for reform. -after Publisher
Costa Rica and Uruguay are both formerly successful agricultural economies whose development has been startlingly similar in the 20th century. Both became vulnerable to external shocks. In Uruguay a balance of payments crisis was triggered by the large oil price increases of the early 1970s. Costa Rica, a decade later, suffered when voluntary lending to Latin America was brought to a halt by the world debt crisis. This book explores the circumstances that led to the crises of the early 1970s in Uruguay and of the early 1980s in Costa Rica. The first part shows how the private management of the coffee economy in Costa Rica was absorbed into a parastatal system. The second examines how the livestock economy in Uruguay degenerated into stagnation between 1957 and 1973. A third part compares the experiences of the two countries. -from Publisher
Formal institutions put in place upon the establishment of a new democracy can have profound effects on political bargaining. We demonstrate how the budgetary procedure bequeathed by the outgoing Chilean military regime affects policy choices available to elected officials. Chilean budget procedure should discourage deficits, allow for a reduction in the relative size of the defense budget, and facilitate cuts in executive proposals when the institutional interests of the legislature are at stake I,ut not under conditions of coalitional conflict. We present a simple spatial model of bargaining over spending decisions between the executive and Congress that facilitates comparisons between the Chilean budget procedure and that of other presidential systems. The model suggests that, relative to other regimes, Chile's budget process should constrain spending and favor the president's preferences over the legislature's. Comparative fiscal data from twelve other presidential democracies and from the first eight Chilean budgets since the transition to democracy, as well as interviews with key legislators and executive officials, sill support our hypotheses.
The recent trends toward economic liberalization in Latin America provide an unusual opportunity to analyze a number of important questions in the political economy of development and underdevelopment. Why has virtually every Latin American country suddenly reversed the direction of the economic policies that had been in place for a full half-century or more? Why is the pace of such change rapid in some countries and slow in others? What are the already discernible and likely future consequences of such changes for development? What are their implications for theories of development and underdevelopment? What conceptual, theoretical, and methodological tools are available and fruitful for analyzing these topics? This paper examines these questions with particular reference to the difference in the pace of change toward economic liberalization between Argentina under Menem and Brazil under Collor.
As many formerly authoritarian regimes have been replaced by democratic governments in Latin America, Eastern Europe, and elsewhere, questions have arisen about the stability and durability of these new governments. One concern has to do with the institutional arrangements for governing bequeathed to the new democratic regimes by their authoritarian predecessors and with the related issue of whether presidential or parliamentary systems work better for the consolidation of democracy.
In this book, Peter Siavelis takes a close look at the important case of Chile, which had a long tradition of successful legislative resolution of conflict but was left by the Pinochet regime with a changed institutional framework that greatly strengthened the presidency at the expense of the legislature. Weakening of the legislature combined with an exclusionary electoral system, Siavelis argues, undermines the ability of Chile's National Congress to play its former role as an arena of accommodation, creating serious obstacles to interbranch cooperation and, ultimately, democratic governability.
Unlike other studies that contrast presidential and parliamentary systems in the large, Siavelis examines a variety of factors, including socioeconomic conditions and characteristics of political parties, that affect whether or not one of these systems will operate more or less successfully at any given time. He also offers proposals for institutional reform that could mitigate the harm he expects the current political structure to produce.
One of the most important debates of the 1980s has centered on the impact of structural adjustment programs on the poor. Some argue that the poor suffered severely during the 1980s and that much of their suffering can be attributed to adjustment. Others hold that declining standards of living were experienced by some, but certainly not all or even most of the poor, and that without adjustment, the extent and depth of suffering would have been greater. The debate encompasses two distinct questions: what happened to the poor during the 1980s and have adjustment policies intensified poverty? The first question is factual, and the answer lies in a careful analysis of available information. But, to answer the second question, one must be able to develop a credible outline of what would have happened without adjustment; that is, an appropriate counterfactual situation has to be developed. The articles in this issue address both questions.
Sometimes politicians run for office promising one set of policies, and if they win, switch to very different ones. Latin American presidents in recent years have frequently run promising to avoid pro-market reforms and harsh economic adjustment, then win and transform immediately into enthusiastic market reformers. Does it matter when politicians ignore the promises they made and the preferences of their constituents? If politicians want to be reelected or see their party reelected at the end of their term, why would they impose unpopular policies? Susan Stokes develops a model of policy switches and tests it with statistical and qualitative data from Latin American elections over the last two decades. She concludes that politicians may change policies because unpopular policies are best for constituents and best serve their own political ambitions. Nevertheless, even though good representatives sometimes switch policies, abrupt change tends to erode the quality of democracy.
In recent years, debate on the state's economic role has too often devolved into diatribes against intervention. Peter Evans questions such simplistic views, offering a new vision of why state involvement works in some cases and produces disasters in others. To illustrate, he looks at how state agencies, local entrepreneurs, and transnational corporations shaped the emergence of computer industries in Brazil, India, and Korea during the seventies and eighties. Evans starts with the idea that states vary in the way they are organized and tied to society. In some nations, like Zaire, the state is predatory, ruthlessly extracting and providing nothing of value in return. In others, like Korea, it is developmental, promoting industrial transformation. In still others, like Brazil and India, it is in between, sometimes helping, sometimes hindering. Evans's years of comparative research on the successes and failures of state involvement in the process of industrialization have here been crafted into a persuasive and entertaining work, which demonstrates that successful state action requires an understanding of its own limits, a realistic relationship to the global economy, and the combination of coherent internal organization and close links to society that Evans called "embedded autonomy."
What changes more often the fashion designs coming from Paris and Milan or the economic policy designs Washington and Wall Street prescribe for countries that are less developed or that are emerging from decades of communism? While this comparison may seem frivolous, a review of the ideas that have guided thinking and action about economic reforms in this decade shows that they are as faddish as skirt lengths and tie widths. The difference, of course, is that economic policy fashions affect the way millions of people live and define their children's chances of a better future. Ideas about what makes a country prosperous have always been fickle. This decade has been no different in terms of the variety and volatility of the policy prescriptions that became dominant among academics, policy makers and the better-informed segments of the world's population. The 1990s, however, have been different in one significant respect: during this decade the world has been under the impression that there was a clear and robust consensus about what a poor country should do to become more prosperous. This misimpression clearly owes a lot to the surprising popularity of the term 'Washington consensus' the name that economist John Williamson gave in 1989 to a list of 10 policy recommendations for countries willing to reform their economies.' The general ideas derived from the Washington Consensus had a huge influence on the economic reforms of many countries. Yet the way these countries interpreted such ideas varied substantially and their actual implementation even more so. Moreover, the original 10 policy prescriptions of the Washington Consensus reigned unchallenged for only a short time. Changes in the international economic and political environment and new domestic realities in the reforming countries created problems the Consensus did not envision or encompass, thus forcing the search for new answers. The newfound answers often complemented the recommendations originally offered by the Washington Consensus, but some also ran counter to them. The wildly gyrating ideas about controls on foreign capital or about exchange rate regimes that have been offered at different times are good examples of the lack of consensus or indeed the confusion that prevailed among the experts. Moreover, throughout the decade, both the general media and expert commentators often characterised the reforms implemented in countries as different as MoisesNaim is the Editor-in-Chief of Foreign Policy, 1779MassachusettsAvenue, Washington, DC20036, USA.
We employ the broader transactions theory presented in Spiller and Tommasi (2000) to explain the inability of the Argentine Congress to function as an effective check on the executive branch and the limited role played by the Congress in the production of public policy. We conclude that given the dearth of institutional incentives for legislators to invest in Congress as an institution, the body has been relegated to the role of a blunt veto player in its interaction with the executive branch. We first highlight the short duration of most congressional careers (between 1983 and 1999 only 17% of legislators were re-elected). We then discuss the manner in which the rules governing the election of public officials in Argentina limit the incentives for deputies to invest in Congress and outline the general nature of Argentine political career paths (which are mostly province-based). While an overwhelming majority of legislators serve only one term in Congress, they are nonetheless almost without exception career politicians. We then detail the lack of specialization among legislators that results from the above-mentioned institutional incentives, and lastly provide detailed empirical evidence of the limited tendency of the Congress to substantively alter important bills (which later became laws) originating in the executive branch.
Journal of Democracy 6.2 (1995) 102-112
Russia entered 1995, the fourth year of its move toward a stable market economy, with uncertain prospects. Doubts centered around three critical issues. The first related to the speed with which economic reforms could proceed under the political arrangements obtaining in Russia. The pace of economic transition could not be rapid in a democratic setting, where consensus-building is a slow but necessary process.
The second issue was the sheer enormity of the task itself, quite apart from any political considerations. How rapidly could the attitudes needed for free markets take root among people long accustomed to central plans and state-run farms, factories, and offices? Decisions that are routine in market economies -- what to produce, which technologies to adopt, where to set up a factory, how much to borrow from a bank -- turned out to be daunting for those who had never been faced with such choices. Household decisions about which job to select, or whether to borrow money to start a small business, proved no less formidable. The interaction among countless choices like these generates market efficiency. Few reforming economies were ready to leap from centralized planning to a market in which innumerable decision makers had to play by an unfamiliar set of rules. For most of these countries, and certainly for Russia, the speed of the process was unavoidably conditioned by the ability and willingness of individuals to shed old habits and learn new ones.
The third issue was the role of outside advice and funds in the process of economic transition. Learning to work with foreign lenders and experts (such as the staff of the International Monetary Fund) turned out to be exceedingly difficult for Russians, who had lived all their lives in a closed and excessively planned society.
Russian policy makers, unfamiliar with the complexities of aid diplomacy, nursed hopes for aid and credits from bilateral and multilateral sources that ran far ahead of any potential flow. Joining them in these unrealistic expectations were Western advisors like Harvard professors Jeffrey Sachs and Graham Allison, each of whom in early 1991 floated a megabuck aid plan designed to initiate rapid economic reforms in Russia. Also lacking was the recognition that foreign investors would not send capital to Russia without sound opportunities to turn a profit. At the same time, however, some available credits went unused because government agencies and local businesses could not come up with investment ideas promising enough to win the approval of donors applying market criteria. Here again, an arduous economic-learning process slowed the pace of transition.
Taking first the issue of the interaction between the political arrangements and the speed of economic reform in Russia, we may identify three distinct phases with important lessons for such interaction. Together, these phases have covered the last decade, reaching back into the final years of the Soviet period.
The first phase, characterized by accelerating democratization (broadly described under the rubric of glasnost') and mild economic reform (perestroika), came under Communist general secretary Mikhail Gorbachev (March 1985-December 1991). This period ended with the USSR's collapse in the wake of the failed putsch of August 1991. There followed a tumultuous interlude of nearly two years (January 1992-October 1993), during which political polarization mounted as the policy of economic "shock therapy" initiated by Russian president Boris Yeltsin and his lieutenants fed a rift between his administration and the Supreme Soviet (Russia's legislature, elected under the Soviet Communist regime in 1990). This second phase ended with a bang when troops loyal to Yeltsin stormed a group of diehard Supreme Soviet members and armed supporters who had barricaded themselves into the parliament building in Moscow rather then comply with the president's order to disband. The third phase, under the cabinet of Premier Viktor Chernomyrdin, saw economic reform make uneven progress amid copious political lobbying by interest groups in the successor body to the Supreme Soviet, the new State Duma (whose members were elected in December 1993 under a new constitution adopted by referendum).
Regarding the first of these phases, one cannot resist asking: What if Gorbachev...
This paper investigates the efficiency of adjustment to economic reform programs when the cost of adjustment arises from high unemployment that can be generated as contracting sectors shrink faster than expanding sectors grow. Under plausible assumptions on the adjustment process, the speed of adjustment to “shock therapy” reforms is shown to be excessively rapid, and the rate of unemployment to be excessively high during the transition to the new equilibrium. The authorities can improve the efficiency of the adjustment by removing the distortion gradually, rather than abruptly. Gradualism has beneficial income distributional, as well as efficiency properties, because it improves welfare of the unemployed, who are necessarily the least advantaged social group in this model.