Hostname: page-component-586b7cd67f-dlnhk Total loading time: 0 Render date: 2024-11-30T20:09:01.345Z Has data issue: false hasContentIssue false
  • English
  • Français

Distributional Coalitions and the Politics of Economic Reform in Latin America

Published online by Cambridge University Press:  13 June 2011

Hector E. Schamis
Hector E. Schamis
Affiliation:
Cornell University
Get access

Abstract

For much of the discipline of economics, a closed economy is seen as the result of efforts of distributional coalitions and rent seekers to maintain sector-specific protections. Accordingly, economic liberalization is explained by the policy consistency of uncompromising reform elites. Students of the politics of economic adjustment in the developing world, in turn, have argued that reform programs concentrate costs in the present and disperse benefits in the future. Hence, losers are prepared to engage in collective action, whereas prospective winners, facing uncertainty about payoffs, remain disorganized. They thus posit the cohesiveness and insularity of policymakers as the main variable for explaining successful reform. Both economists and political scientists, therefore, adopt a collective action approach that overlooks how groups organize in support of liberalization.

In the recent Latin American experience, however, these reforms have preserved market reserves for firms that provided vital political support to, and often colluded with, policymaking elites. This setting has thus reproduced incentives for rent-seeking behavior, even in the presence of comprehensive liberalization. This evidence supports two interrelated theoretical claims. First, distributional coalitions may proliferate when the state withdraws from the economy, not only when it intervenes. Second, interest-based variables retain explanatory power in political economy—which state autonomy arguments disregard—irrespective of whether the economy is closed or open—which neoclassical perspectives overlook. To highlight the centrality of interest groups favoring marketization, therefore, the article suggests modifications to the dominant theories of collective action and the literature on the politics of economic adjustment.

Type
Research Article
Information
World Politics , Volume 51 , Issue 2 , January 1999 , pp. 236 - 268
Copyright
Copyright © Trustees of Princeton University 1999

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

1 For a summary of this field, see Colander, David, ed., Neoclassical Political Economy: The Analysis of Rent Seeking and DUP Activities (Cambridge, Mass.: Ballinger, 1984)Google Scholar; andc Srinivasan, T. N., “Neoclassical Political Economy, the State, and Economic Development,” Asian Development Review 3, no. 2 (1985)Google Scholar.

2 Harberger, Arnold, “Secrets of Success: A Handful of Heroes,” American Economic Review 83 (May 1993)Google Scholar. For a similar view, see Blejer, Mario and Coricelli, Fabrizio, The Making of Economic Reform in Eastern Europe: Conversations with Leading Reformers in Poland, Hungary, and the Czech Republic (Brookfield, Vt.: E. Elgar, 1995)Google Scholar.

3 By “the politics of economic adjustment,” I refer to works such as Nelson, Joan, ed., Fragile Coalitions: The Politics of Economic Adjustment (New Brunswick, N.J.: Transaction Books, 1989)Google Scholar; Nelson, Joan, ed., Economic Crisis and Policy Choice: The Politics of Adjustment in the Third World (Princeton: Princeton University Press, 1990)Google Scholar; Haggard, Stephan and Kaufman, Robert, eds., The Politics of Economic Adjustment (Princeton: Princeton University Press, 1992)Google Scholar; and Haggard, Stephan and Kaufman, Robert, The Political Economy of Democratic Transitions (Princeton: Princeton University Press, 1995)Google Scholar.

4 Olson, Mancur, The Rise and Decline of Nations (New Haven: Yale University Press, 1982), 73Google Scholar; and idem, The Logic of Collective Action (Cambridge: Cambridge University Press, 1965)Google Scholar.

5 The theories of the rent-seeking society share the viewpoint. The original contribution is Krueger, Anne, “The Political Economy of the Rent-Seeking Society,” American Economic Review 64 (June 1974)Google Scholar. See also Tollison, Robert, “Rent Seeking: A Survey,” Kyklos 35 (1982)CrossRefGoogle Scholar.

6 For earl contributions, see Downs, Anthony, An Economic Theory of Democracy (New York: Harper and Row, 1957)Google Scholar; and Norhaus, William, “The Political Business Cycle,” Review of Economic Studies 42 (April 1975)Google Scholar.

7 Significant contributions on this problem are Ames, Barry, Political Survival: Politicians and Public Policy in Latin America (Berkeley: University of California Press, 1987)Google Scholar; Waterbury, John, Exposed to Innumerable Delusions: Public Enterprise and State Power in Egypt, India, Mexico, and Turkey (Cambridge: Cambridge University Press, 1993)Google Scholar; and Geddes, Barbara, Politician's Dilemma: Building State Capacity in Latin America (Berkeley: University of California Press, 1994)Google Scholar.

8 Bhagwati, Jagdish, “Directly Unproductive, Profit-Seeking (DUP) Activities,” Journal of Political Economy 90 (October 1982)CrossRefGoogle Scholar.

9 Buchanan, , “Rent Seeking and Profit Seeking,” in Buchanan, James, Tollison, Robert, Tullock, Gordon, eds., Toward a Theory of the Rent-Seeking Society (College Station: Texas A and M University Press, 1980), 9Google Scholar.

10 David Colander, “Introduction,” in Colander (fn. 1), 5.

11 See, for example, Williamson, John, “What Washington Means by Policy Reform,” in Williamson, , ed., Latin American Adjustment: How Much Has Happened? (Washington, D.C.: Institute for International Economics, 1990)Google Scholar; and Krueger, Anne, Economic Policy Reform in Developing Countries (Oxford and Cambridge: Blackwell, 1992)Google Scholar.

12 See, for instance, Barbara Stallings, “International Influence on Economic Policy: Debt, Stabilization, and Structural Reform,” in Haggard and Kaufman (fn. 3, 1992); and Miles Kahler, “International Financial Institutions and the Politics of Adjustment,” in Nelson (fn. 3, 1989).

13 Thus leading to compensation programs. For a recent review of compensation literature and policies during liberalization, see Greskovits, Béla, The Political Economy of Protest and Patience: East European and Latin American Transformations Compared (Budapest: CEU Press, 1998)Google Scholar, chap.

14 Haggard and Kaufman (fn. 3, 1992), 27. Even if in The Political Economy of Democratic Transitions, Haggard and Kaufman consider other variables to explain economic reform—regime type, party systems, corporatist frameworks, and electoral rules, among others—they insist that “the costs of reform tend to be concentrated, while benefits are diffused, producing perverse organizational incentives; losers are well organized, while prospective winners face daunting collective action problems and are not” (p. 157). Because of this, the explanatory power of insulated policy elites remains higher in the hierarchy than the other variables.

15 Waterbury, “The Heart of the Matter? Public Enterprise and the Adjustment Process,” in Haggard and Kaufman (fn. 3, 1992), 183.

16 Nelson (fn. 3, 1990), 359.

17 Olson (fn. 4, 1982), 44. The end of the paragraph reads: “(or organizations that engage in what, in one valuable line of literature, is called ‘rent seeking’).”

18 See Buchanan (fn. 9). In the same volume, Gordon Tullock, in “Rent Seeking as a Negative Sum Game,” states that “an individual who invests in something that will not actually improve productivity or will actually lower it, but that does raise his income because it gives him some special position or monopoly power, is ‘rent seeking,’ and the ‘rent’ is the income derived” (p. 17).

19 See Edwards, Sebastian, Real Exchange Rates, Devaluation, and Adjustment: Exchange Rate Policy in Developing Countries (Cambridge: MIT Press, 1989)Google Scholar. For the seminal contributions on the real exchange rate during liberalization, see Little, Ian, Scitovsky, Tibor, and Scott, Maurice, Industry and Trade in Some Developing Countries: A Comparative Study (London and New York: Oxford University Press, 1970)Google Scholar; and Balassa, Bela et al. , The Structure of Protection in Developing Countries (Baltimore: Johns Hopkins University Press, 1971)Google Scholar.

20 For example, McKinnon, Ronald, The Order of Economic Liberalization (Baltimore: Johns Hopkins University Press, 1991)Google Scholar; Edwards, Sebastian, “The Order of Liberalization of the External Sector in Developing Countries,” Princeton Essays in International Finance 156 (1984)Google Scholar; and Rodrik, Dani, “How Should Structural Adjustment Programs Be Designed,” World Development 18 (July 1990)CrossRefGoogle Scholar.

21 For the original theoretical contribution, see Krugman, Paul“A Model of Balance-of-Payments Crises,” Journal of Money, Credit, and Banking 11 (August 1979)CrossRefGoogle Scholar. Krugman's model has been extensively applied to Latin American currency crises. See, for example, Calvo, Guifiermo, “Balance of Payments Crises in a Cash-in-Advance Economy,” Journal of Money, Credit, and Banking 19 (February 1987)CrossRefGoogle Scholar; and papers in Journal of International Economics, Symposium on Mexico, 41 (November 1996)Google Scholar.

22 For this intertemporal dynamic, see Laban, Raúl and Sturzenegger, Federico, “Distributional Conflict, Financial Adaptation, and Delayed Stabilizations,” Economics and Politics 6 (November 1994)CrossRefGoogle Scholar; and idem, “Fiscal Conservatism as a Response to the Debt Crisis,” Journal of Development Economics 45 (December 1994)Google Scholar.

23 This parallels Jeffry Frieden's proposition that holders of liquid assets are better shielded from unfavorable government policy. This does not mean, as Frieden suggests, that because of this they are “indifferent to policy.” See Frieden, , Debt, Development, and Democracy (Princeton: Princeton University Press, 1991)Google Scholar.

24 For a series of essays on this problem, see Levy, Brian and Spiller, Pablo, eds., Regulations, Institutions, and Commitment: Comparative Studies of Telecommunications (Cambridge: Cambridge University Press, 1996)CrossRefGoogle Scholar.

25 See Silva, Eduardo, The State and Capital in Chile: Business Elites, Technocrats, and Market Economics (Boulder, Colo.: Westview Press, 1996)Google Scholar, esp. chap. 4.

26 Several of the contributors to the so-called “El Ladrillo,” the economic policy document commissioned by the Navy and written during 1972–73 that served as the basis for the Pinochet economic model, were linked to three economic groups: Edwards, Matte, and BHC (later split in two, Cruzat- Larrafn and Vial). For detailed accounts of these links by insiders, which document the company affiliations of the main actors involved, see Aldunate, Arturo Fontaine, Los Economistas y el Presidente Pinochet (Santiago: Zig-Zag, 1988)Google Scholar; and Talavera, Arturo Fontaine, “Sobre el Pecado Original de la Transformación Capitalista Chilena,” in Levine, Barry, ed., El Desafio Neoliberal (Bogota: Editorial Norma, 1992)Google Scholar.

27 For a review of these policies, see Barletta, Nicolas Arditto, Blejer, Mario, and Landau, Luis, Economic Liberalization and Stabilization Policies in Argentina, Chile, and Uruguay: Application of the Monetary Approach to the Balance of Payments (Washington, D.C.: World Bank Symposium, 1983)Google Scholar.

28 See Zahler, Roberto, “The Monetary and Real Effects of the Financial Opening Up of National Economies to the Exterior: The Case of Chile, 1975–78,” CEPAL Review 10 (April 1980)Google Scholar; and Galvez, Julio and Tybout, James, “Microeconomic Adjustment in Chile during 1977–81: The Importance of Being a ‘Grupo,’“ World Development 13 (August 1985)Google Scholar.

29 For a detailed study, see Gatica, Jaime, Deindustrialization in Chile (Boulder, Colo.: Westview Press, 1989)Google Scholar.

30 See Foxley, Alejandro, Latin American Experiments in Neoconservative Economics (Berkeley: University of California Press, 1982), 66Google Scholar; and data in “Asf Arruinaron la CORFO,” Andlisis (January 14, 1991)Google Scholar.

31 For the first privatization phase, see Dahse, Fernando, El Mapa de la Extrema Rigueza (Santiago: Aconcagua, 1979)Google Scholar. For a general overview, see Hachette, Dominique and Liiders, Rolf, La Privatizacidn en Chile (San Francisco: CINDE, 1992)Google Scholar.

32 For Lüders's assessment, see “La Razón de ser de la Intervención del 13 de Enero,” Economía y Sociedad' 35 (March 1985)Google Scholar. It should be noted that at the time Pablo Baraona, Jorge Cauas, and José Luis Zabala—contributors to “El Ladrillo” (see fn. 26) and key policymakers of the government in the 1970s—were presidents of the Unido de Fomento, Santiago, and Conceptión Banks, respectively; these group-related institutions were liquidated or placed in receivership.

33 Fiscal resources used for the bailouts equaled 5 percent of GDP for five consecutive years. See Velasco, Andres, Liberalization, Crisis, Intervention: The Chilean Financial System, 1975—1985, International Monetary Fund Working Paper 88/66 (July 1988)Google Scholar; and Arellano, José P., “De la Liberalizatión a la Intervencion: El Mercado de Capitales en Chile, 1974–83,” Colección Estudios CIEPLAN (December 1983)Google Scholar.

34 For a detailed analysis of this phase, see Campero, Guillermo, Los Gremios Empresariales en el Pertodo, 1970–1983 (Santiago: ILET, 1984), chap. 5Google Scholar; and idem, “Entrepreneurs under the Military Regime,” in Drake, Paul and Jaksic, Iván, eds., The Struggle for Democracy in Chile, 1982—1990 (Lincoln and London: University of Nebraska Press, 1991)Google Scholar.

35 Munoz, Oscar, “Crisis and Industrial Reorganization in Chile,” Journal of Interatnerican Studies and World Affairs 31 (Spring-Summer 1989)Google Scholar.

36 Information is drawn from the annual reports of those companies between 1985 and 1991. Note the similarities between these attributes of privatization and the East European process, where wellpositioned former communists have become wealthy entrepreneurs by taking over state assets. See, for example, Stark, David, “Privatization in Hungary: From Plan to Market or From Plan to Clan?” East European Politics and Society 4 (Fall 1990)CrossRefGoogle Scholar; idem, “Recombinant Property in East European Capitalism,” American Journal of Sociology 101 (January 1996)Google Scholar; and Tarkowski, Jacek, “Endowment of Nomenklatura, or Apparatchiks Turned into Entrepreneurchiks, or from Communist Ranks to Capitalist Riches,” Innovation 1 (1990)Google Scholar.

37 This is the general tone of a revealing article in the conservative weekly Qué Pasa, which provides detailed information on the participation of former policymakers on the boards of these firms, many of them privatized during their tenure in office. See “El Olimpo Empresarial,” Qué Pasa (May 4, 1992)Google Scholar.

38 See Maxfield, Sylvia, Governing Capital: International Finance and Mexican Politics (Ithaca, N.Y.: Cornell University Press, 1990)Google Scholar.

39 By the main architect, which includes an analysis of the main problems of stabilizing development, see Mena, Antonio Ortiz, “Desarrollo Estabilizador: Una Década de Estrategia Económica en Mexico,” El Trimestre Económico 146 (April-June 1970)Google Scholar.

40 See Bazdresch, Carlos and Levi, Santiago, “Populism and Economic Policy in Mexico, 1970—1982,” in Dornbusch, Rudiger and Edwards, Sebastian, eds., The Macroeconomics of Populism in Latin America (Chicago: University of Chicago Press, 1991)Google Scholar.

41 See, for example, Tirado, Ricardo and Luna, Matilde, “La Politizacion de los Empresarios Mexicanos (1970–1982),” in Labastida, Julio, ed., Grupos Ecónomicos y Organizations Empresariales en Mexico (Mexico D. E: Alianza/UNAM, 1986)Google Scholar; Puga, Cristina and Tirado, Ricardo, “El Consejo Coordinador Empresarial: Una Radiografia,” in Cuadernos del Proyecto Organizaciones Empresariales en Mexico 1 (Facultad de Ciencias Políticas y Sociales-Instituto de Investigaciones Sociales de la Universidad Nacional Autónoma de México, 1992)Google Scholar; Puga, Cristina, México:Empresarios y Poder (Mexico D.F.: UNAM-Porrua, 1993)Google Scholar.

42 See Basave, Jorge, Los Grupos de Capital Finantiero en México (1974–1995) (Mexico D.R: UNAM/EI Caballito, 1994)Google Scholar; esp. chap. 3.

43 For this interpretation, see Tello, Carlos, central bank director at the time, La Nationalizatión de la Banco en Mexico (Mexico D. E: Siglo XXI, 1984)Google Scholar.

44 For a journalistic investigation, see Sucesión Pactada: La Ingeniería Político del Salinismo (Mexico D.F.: Plaza y Valdés, 1993)Google Scholar. For academic references of this process, see Centeno, Miguel Angel and Maxfield, Sylvia, “The Marriage of Finance and Order: Changes in the Mexican Political Elite,” Journal of Latin American Studies 24 (February 1992)CrossRefGoogle Scholar; and Centeno, Miguel Angel, Democracy within Reason: Technocratic Revolution in Mexico (University Park: Penn State University Press, 1994)Google Scholar.

45 Ernesto Zedillo, the head of FICORCA between 1983 and 1987, was elected president in 1994.

46 See the following chapters in Garza, Esthela Gutiérrez, ed., Testimonios de la Crisis IV: Los Saldos del Sexenio (1982–1988) (Mexico D.F.: Siglo XXI, 1990)Google Scholar: Cristina Puga and Constanzo de la Vega, “Modernización Capitalista y Politica Empresarial”; and Alejandro Dávila Flores, “La Bolsa Mexicana de Valores: Alternativa Para el Financiamiento de la Inversión Productiva?”

47 For an overview, see Heredia, Blanca, “Contested State: The Politics of Trade Reform in Mexico” (Ph.D. diss., Columbia University, 1995)Google Scholar; and Ros, Jaime, “La Reforma Comercial en México Durante los Años Ochenta: Sus Efectos Económicos y Dimensiones Polfticas,” UN-ECLA Series Reformas de Politico Piiblica 4 (April 1993)Google Scholar.

48 For the PASE, see Kaufman, Robert, Bazdresch, Carlos, and Heredia, Blanca, “Mexico: Radical Reform in a Dominant Party System,” in Haggard, Stephan and Webb, Steven, eds., Voting for Reform (New York: World Bank and Oxford University Press, 1994)Google Scholar; and by the pact's architect, Aspe, Pedro, El Catnino Mexicano de la Transformación Económica (Mexico D.F.: FCE, 1993)Google Scholar.

49 See Heredia (fn. 47).

50 On paper the pact was a typical tripartite concertation, but the most important accords were made with big business. Agustin Legorreta, former banker and then president of the CCE, confirmed that “the pact was an agreement between the president and a very comfortable little group of three hundred people who make the economically important decisions in Mexico. We gave the government a deadline to fix its finances. It has met that goal earlier. The government has even fulfilled the verbal promises which were not part of the pact's text, such as the liquidation and dissolution of nationally significant firms like Aeroméxico and Cananea.” See Unomásuno (May 18, 1988), 1, 14Google Scholar. In a follow-up to this statement the weekly Proceso reports increasing pressures for privatization on the part of the CCE. See, especially, “Legorreta usa toda su capacidad de presion para que se privatice la economia,” Proceso 607 (June 20, 1988), 10—19Google Scholar. Reportedly, the other organized influence over policy-making came from the Monterrey-based industrial elite who had regular meetings with President De la Madrid and his economic cabinet. See Palacios, Maria de Lourdes Melgar, “Economic Development in Monterrey: Competing Ideas and Strategies in Mexico” (Ph.D. diss., MIT, 1992)Google Scholar.

51 Until 1988 currency devaluations were used to partially offset the effects of trade opening. With the PASE, the adoption of a fixed exchange rate led to a decline in effective protection in the manufacturing sector, from an average 34.8 percent in 1988 to 13.8 percent in 1991. Data from Ugarte, Fernando Sanchez et al. , La Política Industrial ante la Apertura (Mexico D.F.: SECOFI/FCE, 1994), 127Google Scholar. For exchange-rate management, see Kate, Adriaan Ten, “Trade Liberalization and Economic Stabilization in Mexico: Lessons of Experience,” World Development 20 (May 1992)Google Scholar.

52 For this interpretation, see Ugalde, Francisco Valdes, Autonomiay Legitimidad: los Empresarios, la Politka, y el Estado en México (Mexico D.F.: Siglo XXl/UNAM, 1997), 219–21Google Scholar.

53 Elizondo, Carlos, “Privatizing the PRI? Shifts in the Business-PRI Relationship” (Manuscript, CIDE, Mexico D.F., March 1994)Google Scholar.

54 See Puga (fn. 41), 181–204.

55 See Rogozinski, Jacques, head of the government “disincorporation unit,” La Privatization de Empresas Paraestatales (Mexico D.F.: FCE, 1993)Google Scholar.

56 Under NAFTA, Mexican bankers managed to negotiate a gradual opening that restricts the operation of foreign banks to no more than 15 percent of the market in the first six years of the agreement (a process accelerated by the currency crisis of December 1994). See Elizondo, Carlos, “The Making of a New Alliance: The Privatization of the Banks in Mexico,” CIDE Documento de Trabajo 5 (1993)Google Scholar.

57 See Hovey, Rebecca, “The Mexican Commercial Bank Privatizations: Market Reform, Economic Power, and the Transformation of Public and Private Interests” (Ph.D. diss., Cornell University, 1996)Google Scholar; and by the head of the Bank Disincorporation Unit, Martinez, Guillermo Ortiz, La Reforma Financiera y la Desincorporacion Bancaria (Mexico D.F.: FCE, 1994)Google Scholar.

58 See Basave (fn. 42), chap. 5; and Garrido, Celso, “National Private Groups in Mexico,” CEPAL Review 53 (August 1994)Google Scholar.

59 Conger, Lucy, “Power to the Plutocrats,” Institutional Investor (International Edition) 20 (February 1995)Google Scholar. For the dinner, see Proceso 853 (March 8, 1993)Google Scholar. Reportedly, business groups were involved in the PRI campaign since 1988, through the so-called “Comisión de Financiamiento y Consolidación Patrimonial del PRI.” See Vega, Carlos Alba, “Los Empresarios y el Estado Durante el Salinismo,” Foro International 36 (January—June 1996)Google Scholar. More on these links was revealed during the Fobaproa scandal, a $65 billion bailout of several of the privatized banks. Guillermo Ortiz Martínez, for instance, revealed the existence of political favoritism in the privatization and bailouts of the banks. See El Financiero, “Fórmense, vamos a repartir los bancos, dijo Salinas” (July 20, 1998).

60 At the time Martinez de Hoz was the president of the Argentine Economic Council (CEA), an elite organization that grouped the most traditional firms in extractive, manufacturing, and financial activities, renowned for their free-market stance. His economic team included a group of orthodox economists highly reputed in financial circles.

61 Canitrot, Adolfo, “La Disciplina como Objetivo de la Política Económica: Un ensayo sobre el Programa Económico del Gobierno Argentino desde 1976,” Estudios CEDES 2, no. 6 (1979)Google Scholar.

62 Rodríguez, Carlos, “El Plan Argentino de Estabilización del 20 de Diciembre,” CEMA Documento de Trabajo 5 (1979)Google Scholar.

63 For comparisons, see Arditto Barletta et al. (fn. 27).

64 Petrei, A. Humberto and Tybout, James, “Microeconomic Adjustments in Argentina during 1976–1981:The Importance of Changing Levels of Financial Subsidies,” World Development 13 (August 1985)CrossRefGoogle Scholar.

65 In the early 1970s disputes within the Peronist movement developed between factions advocating either a patria socialista or a patria peronista. Later on, and as a consequence of the influence accumulated by labor leaders during the 1973–76 Peronist government, the public made references to thtpatria sindical. In the late 1970s and early 1980s allusions to the patria financiera conveyed that power was now located in the financial sector.

66 The ensuing banking crisis prompted the government to take over fifty-nine financial institutions between March 1980 and December 1981 alone. See Giorgio, Luis and Sagari, Silvia, “Argentina's Financial Crises and Restructuring in the 1980s,” in Sheng, Andrew, ed., Bank Restructuring: Lessons from the 1980s (Washington, D.C.: World Bank, 1996)Google Scholar.

67 There is a full treatment of this in Diaz-Bonilla, Eugenio and Schamis, Hector E., “The Political Economy of Exchange Rate Policies in Argentina, 1950–1998” (Paper presented to the IDB project “The Political Economy of Exchange Rate Policies in Latin America,” Washington D.C., August 1998)Google Scholar.

68 Data from Schvarzer, Jorge, “Estrategia Industrial y Grandes Empresas: El Caso Argentino,” Desarrollo Economico 18 (October—December 1978)CrossRefGoogle Scholar; idem, “Cambios en el liderazgo Industrial Argentino en el período de Martinez de Hoz,” Desarrollo Económico 23 (October—December 1983)Google Scholar; Damill, Mario and Fanelli, José María, “Decisiones de Cartera y Transferencias de Riqueza en un Periodo de Inestabilidad Macroeconomica,” Documento CEDES 12 (1988)Google Scholar; Aspiazu, Daniel, Basualdo, Eduardo, and Khavisse, Miguel, EI Nuevo Poder Econdmico en la Argentina (Buenos Aires: Nueva America, 1987)Google Scholar; Basualdo, Eduardo and Aspiazu, Daniel, Caray Contracara de los Grupos Económicos: Estadoy Promotion Industrial en la Argentina (Buenos Aires: Cántaro, 1991)Google Scholar.

69 For detailed investigations, see Ostiguy, Pierre, Los Capitanes de la Industria: Grandes Empresarios, Politica y Economía en la Argentina de los Años 80 (Buenos Aires: Legasa, 1990)Google Scholar; and Majul, Luis, Los Duenos de la Argentina (Buenos Aires: Sudamericana, 1992)Google Scholar.

70 See Aznar, Luis et al. , Alfonsin: Discursos sobre el Discurso (Buenos Aires: EUDEBA/FUCADE, 1986)Google Scholar.

71 See Ostiguy (fn. 69), 328–38; and Smith, William, “Democracy, Distributional Conflict, and Macroeconomic Policymaking in Argentina, 1983–89,” Journal of Inter American Studies and World Affairs 32 (Summer 1990)CrossRefGoogle Scholar.

72 World Bank, “Argentina: Public Finance Review, from Insolvency to Growth” (February 11, 1993), report 10827-Ar.

73 See Jose Luis Machinea, central bank president during most of this period, “Stabilization under Alfonsin's Government: A Frustrated Attempt,” Documento CEDES 42 (1990)Google Scholar.

74 Ambito Financiero (December 15, 1989), 1, 2.

75 In author interviews with members of the Bank Association (ADEBA) and representatives of large industrial conglomerates held between May and August 1989, several of them admitted that by February 1989 there was a widespread feeling that “something drastic had to be done” in order to make politicians understand, “once and for all,” that the business class would no longer tolerate unpredictability.

76 Author interviews with top economists of the Justicialista Party, later officials in the economy and foreign ministries, Buenos Aires, June 1989, and Washington, D.C., December 1989.

77 For this unprecedented alliance, see Gibson, Edward, Class and Conservative Parties: Argentina in Comparative Perspective (Baltimore: Johns Hopkins University Press, 1997), chap. 6Google Scholar.

78 See Herrera, Claudia, “The Privatization of the Argentine Telephone System,” CEPAL Review 47 (August 1992)Google Scholar.

79 See Gerchunoff, Pablo and Canovas, Guillermo, “Privatization en un Contexto de Emergencia Económica,” Desarrollo Económico 34 (January-March 1995)CrossRefGoogle Scholar; and idem, “Privatization: The Argentine Experience,” in Glade, William, ed., Bigger Economies, Smaller Governments (Boulder, Colo.: Westview Press, 1996)Google Scholar.

80 Data from INDEC, Anuario Estadístico de la República Argentina (Buenos Aires: Ministerio de Economía y Obras y Servicios Públicos, 1997), 480–98Google Scholar.

81 The landmark contributions are Katzenstein, Peter, ed., Between Power and Plenty (Madison: University of Wisconsin Press, 1978)Google Scholar (yet more open to the role of societal groups); Evans, Peter, Rueschemeyer, Dietrich, and Skocpol, Theda, eds., Bringing the State Back In (Cambridge: Cambridge University Press, 1985)CrossRefGoogle Scholar; and Steinmo, Sven, Thelen, Kathleen, and Longstreth, Frank, eds., Structuring Politics: Historical Institutionalism in Comparative Analysis (Cambridge: Cambridge University Press, 1992)CrossRefGoogle Scholar. For a criticism, see Przeworski, Adam, The State and the Economy under Capitalism (Chur, Switzerland: Harwood Academic Publishers, 1990)Google Scholar; and Pontusson, Jonas, “From Comparative Public Policy to Political Economy: Putting Political Institutions in Their Place, and Taking Interests Seriously,” Comparative Political Studies 28 (April 1995)CrossRefGoogle Scholar.

82 For discussions along these lines, see Knight, Jack, Institutions and Social Conflict (Cambridge: Cambridge University Press, 1992)CrossRefGoogle Scholar, esp. chap. 2; and Tsebelis, George, Nested Games (Berkeley: University of California Press, 1990)Google Scholar, esp. chap. 4.