1 OECD Paris - October 12th 2006 Javier Santiso Chief Economist & Deputy Director OECD Development Centre LATIN AMERICA’S POLITICAL ECONOMY LATIN AMERICA’S POLITICAL ECONOMY OF THE POSSIBLE: OF THE POSSIBLE: Beyond Good Revolutionaries and Free Marketeers Beyond Good Revolutionaries and Free Marketeers
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1 OECD Paris - October 12th 2006 Javier Santiso Chief Economist & Deputy Director OECD Development Centre LATIN AMERICAS POLITICAL ECONOMY OF THE POSSIBLE:
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OECD Paris - October 12th 2006
Javier SantisoChief Economist & Deputy Director
OECD Development Centre
LATIN AMERICA’S POLITICAL LATIN AMERICA’S POLITICAL ECONOMY OF THE POSSIBLE:ECONOMY OF THE POSSIBLE:Beyond Good Revolutionaries and Free MarketeersBeyond Good Revolutionaries and Free Marketeers
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LATIN AMERICA: IN THE GARDEN OF LATIN AMERICA: IN THE GARDEN OF DELIGHTS?DELIGHTS?
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Utopia in Latin America: from a spacial search to a temporal search.
A search which has impregnated the history of Latin American political economy: from structuralism to monetarism, from Marxism to Liberalism.
In the 20th Century the whole Continent was dancing a waltz of paradigms.
THE FLOOD OF PARADIGMS IN LATIN AMERICATHE FLOOD OF PARADIGMS IN LATIN AMERICA
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The transformations of the Latin American continent are now obvious.
In the region as a whole, the conceptual and practical framework of political economies have been transformed.
Democracy and the Market have taken over from Revolution and the State on the altar of references.
To sum up, a complete vocabulary and grammar have disappeared from the political and economic repertoire allowing a new ideology to emerge.
DEMOCRACY AND THE MARKET: DEMOCRACY AND THE MARKET: THE NEW ALPHABETTHE NEW ALPHABET
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THE POLITICAL ECONOMY OF THE POSSIBLE:THE POLITICAL ECONOMY OF THE POSSIBLE:THE SILENT TRANSFORMATIONTHE SILENT TRANSFORMATION
Javier Santiso, Latin America's Political Economy of the PossibleBeyond Good Revolutionaries and Free-Marketeers, Cambridge, Mass., MIT Press, 2006.
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THE GREAT TRANSFORMATION: THE MONETARY MAST
0
50
100
150
200
250
Latin America Total Emerging Markets
Inflation (%)
Source: Based on IMF
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*Central Government
By Country (2005)
-4.0%
-3.5%
-3.0%
-2.5%
-2.0%
-1.5%
-1.0%
-0.5%
0.0%
0.5%
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
-3.0*%
+0.3%
-4% -2% 0% 2% 4% 6%
Brasil
Colombia
Peru*
México
Venezuela*
Argentina*
Chile*
LAC-7: FISCAL BALANCE(SPNF, in % of GDP)
THE GREAT TRANSFORMATION: THE FISCAL ANCHOR
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THE GREAT TRANSFORMATION: THE EXTERNAL ANCHOR
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
(e)
Trade openness in Latin America
Source: Based on BBVA
0% 10% 20% 30% 40% 50% 60% 70%
Mexico
Chile
Venezuela
Uruguay
Argentina
Colombia
Peru
Brazil
Trade openness in 2005
Source: OECD Development Centre
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Evolution of the Pension System in Latin America (in % of GDP)
0%
5%
10%
15%
20%
25%
30%
1 2 3 4 5 6 7 8 9 1 11
Num. periods
ARGENTINA BOLIVIA COLOMBIACOSTA RICA CHILE EL SALVADORMEXICO PERU URUGUAY
Return of Democracy
GRADUALISM AND CONTINUISM: GRADUALISM AND CONTINUISM: PENSIONS REFORMSPENSIONS REFORMS