The Origins of Institutional Crises in Latin America

Institutional instability and interbranch crises pose a fundamental challenge to democracies in Latin America and the developing world more generally. Combining a standard game theoretic model of crisis bargaining with a unique dataset on courts, executives, and legislatures for 18 Latin American countries between 1985 and 2008, the article develops a strategic account of how interbranch crises emerge and evolve. In addition to providing the first systematic picture of the frequency, type, and location of interbranch crises for the region, the article demonstrates that the decision to initiate an interbranch crisis is influenced by the allocation of institutional powers, public support for the targeted branch, and the expectations of success based on recent experiences. Building on these results, the article identifies several novel directions for future research on institutional instability.     

The politics of vice-presidential selection in Latin America

It has become common for presidential candidates in Latin America to pick running-mates from outside of their own political parties in the form of political independents or politicians from other parties. As witnessed in several recent cases, this has added a new dynamic to Latin American presidentialism, not least in situations of political crisis. Drawing on a new database, the present paper enquires into the factors that may lead prospective presidents to select such “external vice-presidents”. The findings show that the logics behind selecting either a politician from another party or a political independent as running-mate differ. While the size of the presidential candidate's own party explains the decision to select vice-presidential candidate from another party, the choice of an independent is determined by the fragmentation of the party system. Furthermore, there is evidence that previous experiences of vicepresidential succession makes the selection of an independent running-mate more likely, possibly as a attempt to guard against challenges to the future presidency. Generally, presidential hopefuls tend to pick external running-mates who lack a strong political following, which also indicates that electoral logic is often mitigated by concern for the stability of the eventual presidency.     

Niche parties in Latin America

Niche parties, which have been defined as focusing on a narrow range of issues their competitors neglect, are a phenomenon that has so far been described and analysed primarily in Western Europe. In this paper, we extend existing work by examining the presence and nature of niche parties in Latin America. Using the expert survey data collected by [Wiesehomeier, N., and K. Benoit. 2009. “President, Parties, and Policy Competition.” The Journal of Politics 71: 1435–1447], we show that there are niche parties in most Latin American party systems. Two kinds of niche party, traditionalist and postmaterialist, predominate. We also show that niche parties, despite being defined based on issue-based characteristics, are in fact less programmatic in their linkage strategies than mainstream competitors. Instead, niche parties are slightly more likely to draw on charismatic strategies and tend to establish strong organizational links to ethnic and religious organizations. Niche parties in Latin America are primarily vehicles for the mobilization of group interests. These findings have implications for our understanding of political representation in new democracies and niche party strategies more generally.     

Tax morale in Latin America

In the tax compliance literature, there is a lack of empirical evidence on the degree of tax morale in developing countries. As a novelty, this paper focuses thus on Latin America, analysing tax morale as a dependent variable and searching for factors that systematically affect tax morale, working with the two data sets Latinobarómetro and World Values Survey. Our findings indicate that there is a significant correlation between tax morale and the size of shadow economy. Furthermore, people who said they knew/have heard about practised tax avoidance have a significantly lower tax morale than others. Looking at individuals’ perception of reasons for tax evasion we found that the tax burden, lacking honesty, and corruption are seen as the main factors. We observed a significantly lower tax morale in South America/ Mexico than in the Central American/Caribbean area. Furthermore, trust in the president and the officials, the belief that other individuals obey the law and a pro democratic attitude have a significant positive effect on tax morale.     

Professionalised Campaigning in Latin America

Abstract

This paper analyses the process of democratisation within Latin American by focusing on the nature of election campaigning in the region. Particular attention is paid to developments in three former military dictatorships, which now regularly hold elections. The states are Argentina, Chile and Uruguay, and consideration is given to the insights and limitations of applying the “Americanisation” or modernisation thesis in studying their distinctive media and political cultures. The elections held in each state during 1999 are used as case studies. What emerges is a complex pattern in which candidates and parties have simultaneously adopted some of the professional forms of electioneering whilst retaining and valuing the more traditional and interpersonal electioneering techniques. Furthermore, it was pointed out that there were marked differences in politicians' approaches to campaigning both between as well as within the three different political systems.     

Partisan technocratic cycles in Latin America

Given their powerful positions in presidential cabinets, technocrats are an important transmission mechanism for explaining economic policy choices, but have received less attention compared to other well-established channels such as elections or democratic tenure. I incorporate the role of technocratic advisors into a domestic policymaking framework. Specifically, I contend that left governments tend to appoint technocrats, or ministers with mainstream economics training, to signal their commitment to sound governance to the electorate. This partisan technocratic pattern, however, is conditioned by a country's place in its business cycle. During periods of high growth, left governments are more likely to align with their partisan preferences and appoint heterodox advisors that drift from fiscal discipline. Employing an originally constructed data index, the Index of Economic Advisors, I conduct a statistical test of 16 Latin American countries from 1960 to 2011, finding partisan shifts in technocratic appointments and fiscal governance that are conditioned by national business cycles.     

Social Security privatization in Latin America

The new, partially privatized social security system adopted by Chile in 1981 has attracted attention in many parts of the world. Since then, a number of Latin American countries have implemented the Chilean model, with some variations: either with a single- or multi-tier system, or with a period of transition to take care of those in the labor force at the time of the change. The single-tier version consists of a privatized program with individual accounts in pension fund management companies. Multi-tier systems have a privatized component and retain some form of public program. This article describes each of the new programs in Latin America, their background, and similarities and differences among them. Much more information is available for Chile than for the other countries (in part because Chile has the oldest system), enough to be able to evaluate what, in most cases, is the most accurate information. That is often not the case for the other countries, especially when dealing with subjects such as transition costs and net rates of return (rates of return minus administrative fees). No country has copied the Chilean system exactly. Bolivia, El Salvador, and Mexico have closed their public systems and set up mandatory individual accounts. Argentina has a mixed public/private system with three tiers. In Colombia and Peru, workers have a choice between the public and private programs. Uruguay created a two-tier mixed system. Costa Rica has a voluntary program for individual accounts as a supplement to the pay-as-you-go program and has just passed a law setting up mandatory accounts containing employer contributions for severance pay. All of the countries continue to face unresolved issues, including: High rates of noncompliance--the percentage of enrollees who do not actively and regularly contribute to their accounts--which could lead to low benefits and greater costs to the governments that offer a guaranteed minimum benefit; Proportionately lower benefits for women and lower earners than for men and higher earners; A minimum required rate of return among the pension fund management companies (in most of these countries) that has resulted in similarity among the companies and the consequent lack of meaningful choice; and High administrative fees in most of these countries, which reduce the individual's effective rate of return. To what extent these issues can be mitigated or resolved in the future is not yet clear. In general, a definitive assessment of the Chilean model and its Latin American variations will not be possible until a cohort of retirees has spent most of its career under the new system.     

Fiscal Decentralization and Federalism in Latin America

In contrast to years of centralization when the national governmentdominated the states and municipalities, fiscal decentralizationis now taking place throughout Latin America. This study considersthe reasons for this change. Fiscal decentralization meritsseparate attention because the financial independence of subnationalgovernments ultimately determines their success and power. Competingpolitical and economic explanations are tested on a sample of17 countries between 1985 and 1995. While federalism is a significantpredictor of greater fiscal decentralization, other factorssuch as presidential power, structural adjustment, level ofdevelopment, and country size also determine the level of fiscaldecentralization.     

Another lost decade? The future of reform in Latin America

The 1990s ended equivocally in Latin America. What has gone wrong? Is economic failure the cause or the consequence of the democratic decay and the erosion of governance throughout the region? The review essay revisits the debate on the intricate links between politics and economics in the second stage of reform. Moving beyond standard typologies of regime type, it explores the interactions between the quality of democratic governance and the performance of economic policy under democratic auspices, in particular its credibility. It is now amply recognized that reforms have been hindered by inefficient unreliable and unaccountable government institutions. Furthermore, the manner in which market reforms have been implemented has undermined governance and accountability. The importance of policy credibility has essentially been neglected as a pivotal condition for effective economic reform. Consequently, policymakers propose a new round of reforms, centring on strengthening the institutions of governance and modifying the incentives shaping public policy. The essay argues that restoring the credibility of policy requires a fundamental redefinition of the state and reforming the methods of government and the styles of policymaking. The defining challenge of Latin American countries is to strengthen capacity to adequately implement policy and credibly commit to policy reform. Copyright © 2003 John Wiley & Sons, Ltd.     

The demographic consequences of austerity in Latin America: methodological aspects

This work reviews evidence in the literature of possible demographic effects of the austerity programs imposed on Latin American countries in the 1980s. The work focuses on methodological problems involved in assessing demographic changes and ascertaining that they were indeed attributable to the economic crisis. An introductory section describes the recession of the 1980s in Latin America, the declines in employment and living standards, and the health and social consequences of the deepening poverty. But the author argues that evaluation of health conditions, levels of nutrition, and especially factors such as infant mortality, fertility, marriage patterns, and migration as indicators of the impact of the economic depression is full of pitfalls that are not always obvious. Few Latin American countries have civil registration systems capable of providing accurate and up-to-date mortality and fertility data. Indirect methods currently in use were intended to analyze longterm levels and trends and are of little use for short-term fluctuations. Data on internal migration are scarce even in developed countries. Even when recent data are available it is often difficult or impossible to obtain data for comparison. Infant mortality and malnutrition levels, for example, are serious problems in many parts of Latin America, but series of data capable of demonstrating that they are truly consequences of the economic crisis are lacking. Another challenge is to separate the demographic effects of the debt crisis from longterm structural processes. The possibility of time lags and of different time frames may increase confusion. Almost a year must pass before effects on birth rates can be expected, for example. Neutralizing mechanisms may obscure the effects sought. Thus, the most impoverished urban sectors may return to the countryside to seek refuge in subsistence agriculture; their departure would in some measure diminish the consequences of recession in the urban economy. The type of cross-sectional analysis of differential fertility and mortality that is currently stressed in demographic studies is of limited utility for understanding the demographic impact of economic oscillations, for which a longitudinal approach is required. The next section of the article compares evidence of the effects of the recession of the 1980s with the Great Depression of the 1930s and with historical crises, suggesting that contemporary economic recessions have little in common in terms of causes or demographic consequences with historic crises. Specific studies and available data are then examined in the areas of fertility and mortality, longterm consequences of the economic recession, and migration.