Bulmer-Thomas V., Coatsworth J., Cortes-Conde R. The Cambridge Economic History of Latin America: Volume 2, The Long Twentieth Century
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662 Bibliographical Essays
Celso Furtado, The Economic Growth of Brazil: A Survey from Colonial to Modern
Times (Berkeley, CA, 1963), is a classic treatment of the 1930s and 1940s. For
later periods, see Pedro S. Malan and Regis Bonelli, “The Brazilian Economy in
the Seventies: Old and New Developments,” WorldDevelopment 5 (1977): 19–45;
Edmar L. Bacha, El milagro y la crisis: Economia brasile
˜
na y latinoamericana (Mexico
City, 1986); Edmar L. Bacha, “Issues and Evidence on Recent Brazilian Growth,”
WorldDevelopment 5 (1977): 47–67;Peter Evans, Dependent Development: The
Alliance of Multinational, State and Local Capital in Brazil (Princeton, NJ, 1979);
World Bank, Brazil: Industrial Policies and Manufactured Exports (Washington,
DC, 1983); John Wells, “Brazil and the Post-1973 Crisis in the International Econ-
omy,” in Rosemary Thorp and Laurence Whitehead, eds., Inflation and Stabilisa-
tion in Latin America (Basingstoke, 1979); and Dion
´
ısio Dias Carneiro, “Long-Run
Adjustment, the Debt Crisis and the Changing Role of Stabilization Policies in
the Recent Brazilian Experience,” in Rosemary Thorp and Lawrence Whitehead,
eds., Latin American Debt and the Adjustment Crisis.
On Mexico, see Enrique C
´
ardenas, ed., Historia econ
´
omica de M
´
exico,vol. 5
(Mexico City, 1994); Leopoldo Sol
´
ıs, ed., La econom
´
ıa mexicana,vol. 1, An
´
alisis por
sector y distribuci
´
on, and vol. 2, Pol
´
ıtica y desarrollo (Mexico City, 1973); Rolando
Cordera, ed., Desarollo y crisis de la econom
´
ıa mexicana. Ensayos de interpretaci
´
on
hist
´
orica (Mexico City, 1981); and Carlos Bazdresch et al., eds., M
´
exico: Auge, crisis
y ajuste (Mexico City, 1993). On Mexico’s long-term foreign economic policies, see
Leopoldo Sol
´
ıs Manjarrez, La realidad econ
´
omica mexicana: retrovisi
´
on y perspectivas
(Mexico City, 2000), ch. 6.Onimport substitution in the long term, see Enrique
C
´
ardenas, “The Process of Accelerated Industrialization in Mexico, 1929–1982,” in
An Economic History of Twentieth-Century Latin America,vol. 3, Industrialization
and the State in Latin America: The Postwar Years (cited previously). On foreign
economic policies in specific periods, see on the 1930s, Enrique C
´
ardenas, “The
Great Depression and Industrialisation: The Case of Mexico,” in Rosemary Thorp,
ed., An Economic History of Latin America,vol. 2, Latin America in the 1930s: The
Role of the Periphery in World Crisis (cited previously); Antonio Ortiz Mena, El
Desarollo estabilizador: Reflexiones sobre una epoca (Mexico City, 1998); Jaime Ros,
“Mexico from Oil Boom to the Debt Crisis: An Analysis of Policy Response to
External Shocks, 1978–85,” in Latin American Debt and the Adjustment Crisis (cited
previously); and Carlos M. Urz
´
ua, “Five Decades Between the World Bank and
Mexico,” in Devesh Kapur, John P. Lewis, and Richard Webb, eds., The World
Bank,vol. 2 (Washington, DC, 1997).
On Chile in the 1930s, see Gabriel Palma, “From an Export-Led to an Import-
Substituting Economy: Chile 1914–1939,” in Rosemary Thorp, ed., An Economic
History of Twentieth-Century Latin America,vol. 2. Latin America in the 1930s:
The Role of the Periphery in World Crisis (cited previously); and Manuel Marf
´
an,
“Politicas reactivadoras y recesion externa: Chile 1929–1938,” in Oscar Mu
˜
noz,
ed., Perspectivas hist
´
oricas de la econom
´
ıa chilena: del siglo XIX a la crisis del 30
(Santiago de Chile, 1984). For the 1950s and 1960s, see An
´
ıbal Pinto, Chile: un
caso de desarrollo frustrado (Santiago de Chile, 1964); and Markos Mamalakis and
Clark Winston Reynolds, Essays on the Chilean Economy (Homewood, IL, 1965).
On the 1970s, see World Bank, Chile. An Economy in Transition (Washington,
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Bibliographical Essays 663
DC, 1979); Alejandro Foxley, Latin American Experiments in Neo-conservative Eco-
nomics (Berkeley, CA, 1983); and Sebastian Edwards and Alejandra Cox Edwards,
Monetarism and Liberalization: The Chilean Experiment (Chicago, 1991).
On Central America and the Caribbean, see Victor Bulmer-Thomas, The Polit-
ical Economy of Central America since 1920 (Cambridge, 1987); and “The Wider
Caribbean in the 20
th
Century: A Long-Run Development Perspective,” Integra-
tion & Trade 15 (2001): 5–56.Onthe Caribbean, see Antonio Santamar
´
ıa Garc
´
ıa,
“Alteration, Crisis and Adjustment in the Cuban Export Economy, 1898–1939,” in
Enrique Cardenas, Jos
´
eAntonio Ocampo, and Rosemary Thorp, eds., An Economic
History of Twentieth-Century Latin America,vol. 1, The Export Age (Basingstoke,
2000), 32–54; and for Cuba before the 1940s, see Henry Wallich, Monetary Prob-
lems of an Export Economy (Cambridge, MA, 1950). Carmela Mesa-Lago, Market,
Socialist, and Mixed Economies. Comparative Policy and Performance. Chile, Cuba,
and Costa Rica (Baltimore, 2000), is useful, especially on post-1959 Cuba and post-
war Costa Rica. On bananas in the Caribbean in the long term, see Peter Clegg, The
Caribbean Banana Trade (Basingstoke, 2000). Also, see Paul W. Ashley, “The Com-
monwealth Caribbean and the Contemporary World Order: The Cases of Jamaica
and Trinidad,” in Paget Henry and Carl Stone, eds., The Newer Caribbean: Decol-
onization. Democracy, and Development (Philadelphia, PA, 1983); Jennifer Sharply,
“Jamaica, 1972–1980,” in Tony Killick, ed., The IMF and Stabilization: Developing
Country Experiences (New York, 1984); and Anthony Payne and Paul Sutton, eds.,
Dependency under Challenge: The Political Economy of the Commonwealth Caribbean
(Manchester, 1984).
On Colombia, see Jos
´
e Antonio Ocampo et al., “Consolidaci
´
on del capital-
ismo moderno (1945–1986),” in Jos
´
e Antonio Ocampo, ed., Hist
´
oria econ
´
omica de
Colombia (Bogot
´
a, 1987). Also, see Jos
´
e Antonio Ocampo, “The Colombian Econ-
omy in the 1930s,” in Rosemary Thorp, ed., An Economic History of Twentieth-
Century Latin America,vol. 2. Latin America in the 1930s: The Role of the Periphery
in World Crisis (cited previously); Jos
´
e Antonio Ocampo and Santiago Montene-
gro, Crisis mundial, protecci
´
on e industrializaci
´
on: Ensayos de hist
´
oria econ
´
omica
colombiana (Bogot
´
a, 1984); Jos
´
e Antonio Ocampo and Camilo Tovar, “Colombia
in the Classical Era of Inward-Looking Development,” in Enrique C
´
ardenas, Jos
´
e
Antonio Ocampo, and Rosemary Thorp, eds., An Economic History of Twentieth-
Century Latin America,vol. 3. Industrialization and the State in Latin America: The
Postwar Years (cited previously); and Carlos D
´
ıaz-Alejandro, Foreign Trade Regimes
and Economic Development. Colombia (New York, 1976). Marco Palacios, El caf
´
een
Colombia: Una historia econ
´
omica, social y pol
´
ıtica (Mexico City, 1983)isaclassic
on coffee.
On Peru, see Rosemary Thorp and Geoffrey Bertram, Peru 1890–1977.Growth
and Policy in an Open Economy (London, 1978). Also, see Rosemary Thorp and
Carlos Londo
˜
no, “The Effect of the Great Depression on the Economies of
Peru and Colombia,” in Rosemary Thorp, ed., An Economic History of Twentieth-
Century Latin America,vol. 2. Latin America in the 1930s: The Role of the Periphery in
WorldCrisis (cited previously); Pablo Kuczynki, Peruvian Democracy Under Stress:
An Account of the Belaunde Administration, 1963–1968 (Princeton, NJ, 1977); Shane
Hunt, “Direct Foreign Investment in Peru: New Rules for an Old Game,” in
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664 Bibliographical Essays
Abraham Loewenthal, ed., The Peruvian Experiment: Continuity and Change under
Military Rule (Princeton, NJ, 1975); and several of the essays included in Cynthia
McClintock and Abraham Loewenthal, eds., The Peruvian Experiment Reconsidered
(Princeton, NJ, 1983).
On Venezuela, see Sergio Aranda, La econom
´
ıa venezolana (Mexico City, 1977),
and Pablo Astorga, “Industrialization in Venezuela: The Problem of Abundance,
1936–1983,” in Enrique C
´
ardenas, Jos
´
e Antonio Ocampo, and Rosemary Thorp,
eds., An Economic History of Twentieth-Century Latin America,vol. 3. Industrial-
ization and the State in Latin America: The Postwar Years (cited previously). Also
on Venezuela and the oil industry is Jorge Salazar-Carrillo, Oil and Development
in Venezuela during the Twentieth Century (Westport, CT, 1994); and Franklin
Tugwell, The Politics of Oil in Venezuela (Stanford, CA, 1975).
On the smaller economies not considered previously, references are necessarily
limited. On Bol
´
ıvia, see Walter G
´
omez, La miner
´
ıa en el desarrollo econ
´
omico de
Bolivia (La Paz, 1978); and Juan Antonio Morales and Napole
´
on Pacheco, “El
retorno de los liberales,” in Bolivia en el Siglo XX. La formaci
´
on de la Bolivia con-
tempor
´
anea (La Paz, 1999). On Ecuador, see Fernando Velasco Abad, Ecuador:
Subdesarollo y dependencia (Quito, 1981); and Leonardo Vicu
˜
na, Economia ecua-
toriana: Problemas, tendencias y proyecciones (Guayaquil, 1980). On Paraguay, see
Carlos Fletschner et al., Econom
´
ıa del Paraguay contempor
´
aneo (Asunci
´
on, 1984);
and Joseph Pincus, The Economy of Paraguay (New York, 1968). On Uruguay, see
Instituto de Econom
´
ıa, El proceso econ
´
omico del Uruguay: Contribuci
´
on al estudio
de su evoluci
´
on y perspectivas (Montevideo, 1969); and Jorge Notaro, La pol
´
ıtica
econ
´
omica del Uruguay, 1968–1984 (Montevideo, 1984).
CHAPTER 4 (VICTOR BULMER-THOMAS)
The economic history of Latin America since the end of inward-looking develop-
ment has been shaped by two events: globalization and the debt crisis. On both
of these, there is a substantial literature. In the case of the debt crisis, the litera-
ture focuses heavily on the region. However, the literature on globalization – still
growing rapidly – is much more general in nature and Latin America does not
always feature prominently. Despite this, it is essential reading for those seeking to
understand the nature and character of the New Economic Model that took shape
in Latin America from the 1980s onward.
A good starting point for the debt crisis in Latin America is R. Devlin, Debt
and Crisis in Latin America: The Supply Side of the Story (Princeton, NJ, 1989).
Case studies of most of the worst-affected countries can be found in Rosemary
Thorp and Lawrence Whitehead, eds., Latin American Debt and the Adjustment
Crisis (Pittsburgh, PA, 1987). Both these books were published while the debt crisis
was still developing and do not therefore take account of the issue of Brady bonds
that was widely credited with ending the crisis. The reader should therefore also
consult a number of references that look back over the 1980s debt crisis from the
perspective of the 1990s. These include G. Kaminsky and A. Pereira, The Debt
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Crisis: Lessons of the 1980s for the 1990s (Washington, DC, 1994); J. Boughton, The
IMF and the Latin American Debt Crisis: Seven Common Criticisms (Washington,
DC, 1994); W. Cline, International Debt Re-examined (Washington, DC, 1995);
and R. Grosse, ed., Government Responses to the Latin American Debt Problem
(New Brunswick, NJ, 1995).
Globalization in its modern form is often compared with earlier periods. To
gain a sense of historical perspective, the reader should consult Barry Eichengreen,
Globalizing Capital: A History of the International Monetary System (Princeton, NJ,
1996); and Michael Bordo, Alan Taylor, and Jeffrey Williamson, eds., Globalization
in Historical Perspective (Chicago, 2003). An elegant statement in favor of global-
ization can be found in S. Fischer, “Globalization and Its Challenges,” American
Economic Review (May 2003); and a strong critique by a former chief economist
at the World Bank is provided by Joseph Stiglitz, Globalization and Its Discontents
(New York, 2002). A. Guerra-Borges, Globalizaci
´
on e integraci
´
on latinoamericana
(Mexico City, 2002)isathoughtful book that recognizes the historical inevitabil-
ity of globalization and asks how Latin America can adjust to the new reality. A
similar approach, although not limited to Latin America, is taken by many of
the authors in R. Baldwin and L. Alan Winters, eds., Challenges to Globalization
(Chicago, 2003). See also D. Baker, G. Epstein, and R. Pollin, eds., Globalization
and Progressive Economic Policy: What Are the Real Constraints and Opportunities?
(Cambridge, 1998).
Trade liberalization is only one part of globalization, but it has been a very
important part for Latin America. Trade liberalization was at first driven forward
by GATT and is now promoted by its successor, the World Trade Organization.
There is a good literature on this topic, which is very relevant for Latin America.
SeeJohn H. Jackson, The World Trade Organization: Constitution and Jurisprudence
(London, 1998). See also D. Tussie, “Trade Policy Within the Context of the World
Trade Organization,” CEPAL Review,no.62 (August 1997); and Patricia Gray Rich,
ed., Latin America: Its Future in the Global Economy (Basingstoke, 2002). On trade
liberalization more generally, the reader should consult S. Edwards, “Openness,
Trade Liberalization, and Growth in Developing Countries,” Journal of Economic
Literature 31:2 (September 1998); and J. Frankel and D. Romer, “Does Trade Cause
Growth?” American Economic Review 89:3 (June 1999). A much more sceptical note
on the benefits of free trade is struck by G. Gereffi, D. Spener, and J. Bair, eds.,
Free Trade and Uneven Development (Philadelphia, 2002).
Capital account liberalization is another key part of globalization. The literature
that analyzes this phenomenon in relation to Latin America is discussed subse-
quently. However, the general issues are considered in H. Edison et al., “Capital
Account Liberalization and Economic Performance: Survey and Synthesis” (Inter-
national Monetary Fund Working Paper No. 02/120,Washington, DC, 2002); and
S. Fischer et al., Should the IMF Pursue Capital Account Convertibility? (Princeton,
NJ, 1998). The specific problems of capital account liberalization in emerging mar-
kets are well reviewed in D. Beim and C. Calomiris, Emerging Financial Markets
(New York, 2001); and A. Demirguc-Kunt and E. Detragiache, “The Determinants
of Banking Crises: Evidence from Developing and Developed Countries,” IMF
Staff Papers 45:1 (March 1998).
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The region with which Latin America has been most compared since the debt cri-
sis erupted is Asia. Latin America’s economic performance has often been compared
unfavorably with many Asian countries and an understanding of the transforma-
tion of the Asian economies is therefore important in order to establish whether
this criticism is justified. A classic text on South Korea, perhaps the most successful
Asian tiger, is Alice Amsden, Asia’s Next Giant: South Korea and Late Industrial-
ization (Oxford, 1989). Because this was written before the 1997 Asian financial
crisis, it is necessary to also consider more recent writings. These include Joseph. E.
Stiglitz and S. Yusuf, eds., Rethinking the East Asian Miracle (New York and Wash-
ington, DC, 2001); Alice Amsden, The Rise of “the Rest”: Challenges to the West
from Late-Industrialization Economies (New York, 2001); M. Goldstein, The Asian
Financial Crisis: Causes, Cures and Systemic Implications (Washington, DC, 1998);
and Ha-Joon Chang, “The East Asian Model of Economic Policy,” in E. Huber,
ed., Models of Capitalism: Lessons from Latin America (Chapel Hill, NC, 2002).
Comparisons with Latin America can be found in Nancy Birdsall and F. Jaspersen,
Pathways to Growth: Comparing East Asia and Latin America (Washington, DC,
1997).
There are a number of very useful statistical sources that allow comparisons
between Latin America and other parts of the world during the recent phase of
globalization. See, in particular, the World Bank, WorldDevelopment Indicators
(Washington, DC), which is produced each year as a CD-ROM covering the
period from 1960 to the present. Although it covers a much longer period, Angus
Maddison, The World Economy: A Millennial Perspective (Paris, 2002)isalso invalu-
able. The United Nations produces a large range of relevant statistics, including an
annual report on multinational companies. See United Nations, WorldInvestment
Report (New York). Various regular publications of the International Monetary
Fund are also very helpful for understanding the forces of globalization. See, for
example, International Monetary Fund, WorldEconomic Outlook (Washington,
DC).
The New Economic Model is the name given to the set of policies that shaped
Latin America in the 1980s and 1990s. See Victor Bulmer-Thomas, ed., The New
Economic Model in Latin America and Its Impact on Income Distribution and Poverty
(New York, 1996). See also Barbara Stallings and W. Peres, Growth, Employment
and Equity: The Impact of the Economic Reforms in Latin America and the Caribbean
(Washington, DC, 2000). The New Economic Model is also analyzed in depth
in a special issue of WorldDevelopment.See N. Reinhardt and W. Peres, “Latin
America’s New Economic Model: Micro Responses and Economic Restructuring,”
WorldDevelopment 28:9 (September 2000) and the other articles in the same issue.
The set of policies that make up the New Economic Model were also known in
the 1990sasthe Washington Consensus. See J. Williamson, ed., Latin American
Adjustment: How Much Has Happened? (Washington, DC, 1990). The limitations
of the Washington Consensus began to be widely acknowledged in the second half
of the 1990s, when growth started to falter in Latin America and more emphasis was
put on “second generation” reforms (sometimes called “reform of the reforms”)
that included greater attention to institutions and the rule of law. See Jeffrey
Williamson and P. Kuczynski, eds., After the Washington Consensus: Restarting
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Bibliographical Essays 667
Growth and Reform in Latin America (Washington, DC, 2003). The shortcom-
ings of the Washington Consensus are also discussed in R. Vos, L. Taylor, and R.
Paes de Barros, eds., Economic Liberalization, Distribution and Poverty: Latin Amer-
ica in the 1990s (Cheltenham, 2002). See also Ricardo Ffrench-Davis, Reforming
the Reforms in Latin America: Macroeconomics, Trade, Finance (Basingstoke, 1999).
The structural reforms in Latin America are covered in general terms in a number
of good studies. See Sebastian Edwards, Crisis and Reform in Latin America: From
Despair to Hope (Oxford, 1995). An optimistic note is struck in S. Burki and G.
Perry, The Long March: A Reform Agenda for Latin America and the Caribbean in
the Next Decade (Washington, DC, 1997), although this was written before the
decline of capital flows to Latin America that began in 1998. The most successful
country in Latin America in terms of economic performance (growth and equity)
has been Chile, and this has been extensively analyzed. See, for example, Ricardo
Ffrench-Davis, Economic Reforms in Chile: From Dictatorship to Democracy (Ann
Arbor, MI, 2002).
There has been a strong correlation in Latin America between economic per-
formance and capital inflows. Not surprisingly, therefore, this topic has figured
prominently in the recent economic history of Latin America. See Felipe Larra
´
ın,
ed., Capital Flows, Capital Controls, and Currency Crises: Latin America in the 1990s
(Ann Arbor, MI, 2000). Ricardo Ffrench-Davis and S. Griffith Jones, eds., Coping
with Capital Surges: The Return of Finance to Latin America (Boulder, CO, 1995)
examines the phenomenon of capital inflows at a time when they were booming.
This raised the question of capital controls to stem inflows rather than outflows and
this increasingly relevant topic is explored in J. De Gregorio, Sebastian Edwards,
and R. Vald
´
es, “Controls on Capital Inflows: Do They Work?” Journal of Devel-
opment Economics 63:1 (October 2000). Spanish investment, which in flow terms
became more important than U.S. investment for a short period at the end of the
1990s, is considered in P. Toral, The Reconquest of the New World: Multinational
Enterprises and Spain’s Direct Investment in Latin America (Aldershot, 2001). Chile
also features prominently in the literature on capital inflows and capital controls.
SeeB.Bosworth, Rudiger Dornbusch, and R. Lab
´
an, eds., The Chilean Economy:
Policy Lessons and Challenges (Washington, DC, 1994).
The investment and savings processes in Latin America have also come under
close scrutiny. A careful study of investment can be found in G. Moguillansky
and R. Bielschowsky, Investment and Economic Reform in Latin America (Santiago,
2001). Analyses of savings can be found in Ricardo Hausmann and H. Reisen, eds.,
Promoting Savings in Latin America (Paris, 1997); L. Rojas-Su
´
arez and S. Weisbrod,
Financial Markets and the Behavior of Private Savings inLatin America (Washington,
DC, 1997); and C. Reinhart, Accounting for Saving: Financial Liberalization,Capital
Flows and Growth in Latin America and Europe (Washington, DC, 1999). See also
M. Agos
´
ın, Saving and Investment in Latin America (Geneva, 1994).
Investment in Latin America, particularly DFI, has been closely linked to priva-
tization since the 1980s. This phenomenon has been widely discussed in the region
from different angles. The impact on distribution is the subject of D. McKenzie
and D. Mookherjee, The Distributive Impact of Privatization in Latin America:
Evidence from Four Countries (Boston, 2003). A more general study can be found
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668 Bibliographical Essays
in L. Manzetti, Privatization South America Style (Oxford, 1999); and M. Birch and
J. Haar, eds., The Impact of Privatization in the Americas (Coral Gables, FL, 2000).
A good case study of telecommunications is provided in J. Clifton, The Politics
of Telecommunications in Mexico: Privatization and State-Labour Relations, 1982–95
(Basingstoke, 2000). The privatization debate also includes pension reform. See
A. Barrientos, Pension Reform in Latin America (Aldershot, 1998).
Trade policy has been a dominant feature of work on Latin America since the
debt crisis. See M. Agos
´
ın and Ricardo Ffrench-Davis, “Trade Liberalization and
Growth: Recent Experiences in Latin America,” Journal of Interamerican Stud-
ies and World Affairs 37:3 (1995); G. Dijsktra, “Trade Liberalization and Indus-
trial Development in Latin America,” WorldDevelopment 28:9 (September 2000);
and R. Robertson, “Trade Liberalization and Wage Inequality: Lessons From the
Mexican Experience,” WorldEconomy 23:6 (June 2000). A great deal of atten-
tion has also been paid to hemispheric integration. The main schemes are cov-
ered in Victor Bulmer-Thomas, ed., Regional Integration in Latin America and
the Caribbean: The Political Economy of Open Regionalism (London, 2001). The
concept of “open” regionalism is analyzed in ECLAC, Open Regionalism in Latin
America and the Caribbean – Economic Integration as a Contribution to Changing
Patterns with Social Equity (Santiago, 1994). The Free Trade Area of the Americas
is the subject of J. Salazar-Xirinachs and M. Robert, eds., To ward Free Trade in the
Americas (Washington, DC, 2001).
Exchange rate policy has become increasingly important in Latin America as a
result of the devastating effect of financial crises. The Brazilian experience is dis-
cussed by a former President of the Central Bank in Gerardo Franco, The Real Plan
and the Exchange Rate (Princeton, NJ, 2000); and in A. Ferreira and G. Tullio, “The
Brazilian Exchange Rate Crisis of January 1999,” Journal of Latin American Studies
34:1 (2002); whereas Argentina’s failed Convertibility Law is analyzed in Michael
Mussa, Argentina and the Fund: From Triumph to Tragedy (Washington, DC, 2002).
An overview is provided in M. Falc
˜
ao Silva, Modern Exchange Rate Regimes, Stabil-
isation Programmes and Coordination of Macroeconomic Policies: Recent Experiences
of Selected Developing Latin American Economies (Aldershot, 1999). The politics of
exchange rate policy is the subject of C. Wise and Riordan Roett, eds., Exchange
Rate Politics in Latin America (Washington, DC, 2000). The financial crises of the
1990sare explored in a number of publications. A good study of Mexico can be
found in Stanley Weintraub, Financial Decision-Making in Mexico: To Bet a Nation
(Pittsburgh, PA, 2000); and of Brazil in M. Arruda, External Debt: Brazil and the
International Financial Crisis (London, 2000). The Argentine financial crisis is very
well dissected in the study by Michael Mussa cited previously.
Fiscal and labor market policies have received a certain amount of attention,
although not as much as they deserve. An excellent analysis of fiscal policy can
be found in M. C
´
ardenas and S. Montenegro, eds., La econom
´
ıa pol
´
ıtica de las
finanzas p
´
ublicas en am
´
erica latina (Bogot
´
a, 1999). Social spending is explored in
R. Cominetti and G. Ruiz, Evoluci
´
on del gasto p
´
ublico social en Am
´
erica Latina,
1980–95 (Santiago, 1998). The labor market is explored in some depth in Sebastian
Edwards and Nora Lustig, eds., Labor Markets in Latin America: Combining Social
Protection with Market Flexibility (Washington, DC, 1997). Another good study
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Bibliographical Essays 669
is J. Weller, Reformas econ
´
omicas, crecimiento y empleo: los mercados de trabajo en
am
´
erica latina y el caribe (Santiago, 2000).
The overall performance of Latin America under the New Economic Model is
explored in the last two chapters of Victor Bulmer-Thomas, The Economic History
of Latin America since Independence, 2nd ed. (Cambridge, 2003); and in the last two
chapters of Rosemary Thorp, Progress, Poverty and Exclusion: An Economic History of
Latin America in the 20
th
Century (Washington, DC, 1998). Export performance is
examined in C. Macario, Export Growth in Latin America: Policies and Performance
(Boulder, CO, 2000). The Brazilian experience is covered in Werner Baer, The
BrazilianEconomy: Growthand Development, 5th ed. (Westport, CT, 2001), whereas
Mexico is the subject of Enrique Dussel Peters, Polarizing Mexico: The Impact of
Liberalization Strategy (Boulder, CO, 2000). There are also four interesting case
studies in M. de Miranda, ed., Alternativas de pol
´
ıtica econ
´
omica y social en am
´
erica
latina y el caribe: cuatro casos de estudio: Colombia, Costa Rica, Cuba y M
´
exico
(Bogot
´
a, 2002).
CHAPTER 5 (ALAN DYE)
Most of the contributions to the study of Latin American institutions presuppose
a basic knowledge of the concepts of the new institutional economics or positive
political economy, or if not, they adopt the less rigorous definitions of “institu-
tion” characteristic of literature that preceded the “new institutionalism.” This
bibliography surveys the major new institutionalist contributions to Latin Ameri-
can economic history, including some references to empirical or theoretical works
that do not deal directly with Latin America but are valuable resources for concepts
and theoretical tools relevant to the study of institutions in Latin America. It is
intended as an introduction to the most important works on the subject matter
covered in the chapter, but it is by no means exhaustive.
An insightful, comprehensive study of Latin American institutions is William
P. G lade, The Latin American Economies: A Study of Their Institutional Evolution
(New York, 1969), which gives a rich synthesis of their evolution from the viewpoint
of the American institutionalist school. Claudio V
´
eliz, The Centralist Tradition in
Latin America (Princeton, NJ, 1980) gives a compelling, though loosely argued,
structuralist thesis of Latin American centralist bias. Familiarity with the new
institutional economics, especially North (discussed subsequently), brings greater
analytical clarity to many of V
´
eliz’s inductive insights, which preceded their theo-
retical explanation. Useful methodological surveys of new institutionalist methods
as applied to Latin America are in the editor’s introduction to Stephen Haber, ed.,
How Latin America Fell Behind: Essays on the Economic Histories of Brazil and Mex-
ico, 1800–1914 (Stanford, CA, 1997); and Jeffrey L. Bortz and Stephen Haber, “The
NewInstitutional Economics and Latin American Economic History,” in Jeffrey
L. Bortz and Stephen Haber, eds., The Mexican Economy, 1870–1930:Essays on the
Economic History of Institutions, Revolutions, and Growth (Stanford, CA, 2002),
Cambridge Histories Online © Cambridge University Press, 2008
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670 Bibliographical Essays
1–22. These two collections, along with John H. Coatsworth and Alan Taylor,
eds., Latin America and the World Economy Since 1800 (Cambridge, MA, 1998),
offer rich collections of articles that apply the tools of the new economic history
and new institutionalist analysis to questions central to Latin American economic
history.
The reader who wishes to develop proficiency in the methods of the new insti-
tutional economics should begin with Douglass C. North, Institutions, Institu-
tional Change and Economic Performance (Cambridge, 1990) and Structure and
Change in Economic History (New York, 1981)asthe most accessible and compre-
hensive treatments of the central theoretical concepts. A valuable collection that
focuses on empirical methods and applications is Lee Alston, Thr
´
ainn Eggertsson,
and Douglass North, eds., Empirical Studies in the New Institutional Economics
(Cambridge, 1996). Thr
´
ainn Eggertsson, “A Note on the Economics of Institu-
tions,” in that volume, gives an excellent short overview of the main theoretical
ideas, and Lee Alston, “Empirical Work in Institutional Economics: An Overview,”
gives a pragmatic and insightful survey of empirical strategies that have been used
to test or apply the new institutional economics in practice. Important comple-
ments to this literature are the bodies of work by institutional economists on the
transaction-cost theory of organizations, bargaining, and contracting. The most
engaging treatments of organizational theory are Oliver E. Williamson, The Eco-
nomic Institutions of Capitalism (New York, 1985), and The Mechanisms of Gover-
nance (New York, 1996). A masterful survey of the fields of organization, bargain-
ing, and contracting theory and application is Paul Milgrom and John Roberts,
Economics, Organization and Management (Upper Saddle River, NJ, 1992).
There are many critiques of this literature coming from related social science
disciplines. Two of particular value are Mark Granovetter, “Social Embeddedness,”
American Journal of Sociology 91 (1985): 481–510, and Jack Knight, Institutions and
Social Conflict (Cambridge, 1992).
The theoretical literature on self-enforcing institutions is rapidly changing. At
the writing of this chapter, the most up-to-date, comprehensive, and forward-
looking treatment is Masahiko Aoki, To ward a Comparative Institutional Analysis
(Cambridge, MA, 2001). Much of literature on this question is relatively inac-
cessible to the nonspecialist, but Aoki includes an accessible survey of the most
significant contributions and a lucid analytical synthesis with considerable foresight
into the broad significance of this theoretical literature, refreshingly international
in scope, addressing a variety of types of institutional and organizational patterns
found in Latin America and elsewhere in world. Many of the seminal papers
were authored by Avner Greif and co-authors, of which the works most relevant
to this chapter on culturally or ideologically self-enforcing institutions are Avner
Greif, “Reputation and Coalitions in Medieval Trade: Evidence on the Maghribi
Traders,” Journal of Economic History 49 (1989): 857–82;“Cultural Beliefs and
the Organization of Society: A Historical and Theoretical Reflection on Collec-
tivist and Individualist Societies,” Journal of Political Economy 102 (1994): 912–50;
Avner Greif, “On the Interrelations and Economic Implications of Economic,
Social, Political and Normative Factors: Reflections from Two Late Medieval Soci-
eties,” in John N. Drobak and John V. C. Nye, eds., The Frontiers of the New
Cambridge Histories Online © Cambridge University Press, 2008
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Bibliographical Essays 671
Institutional Economics (San Diego, 1997), 57–94; and Avner Greif, Paul Milgrom,
and Barry Weingast, “Coordination, Commitment, and Enforcement: The Case
of the Merchant Guild,” Journal of Political Economy 102 (1994): 745–76.
Applications of positive political economy to Latin America has made important
advances in recent years. The most important work is Stephen Haber, Armando
Razo, and Noel Maurer, The Politics of Property Rights: Political Instability, Credi-
ble Commitments, and Economic Growth in Mexico, 1876–1929 (Cambridge, 2003).
Jeffrey L. Bortz and Stephen Haber, eds., The Mexican Economy, 1870–1930:Essays on
the Economic History of Institutions, Revolutions, and Growth (Stanford, CA, 2002)
is an outstanding collection of articles giving careful analyses of specific sectors. A
masterfully concise summary of the theoretical commitment problem in the Latin
American political institutions is Stephen Haber, “The Commitment Problem and
Mexican Economic History,” in that volume. For additional analysis and empiri-
cal application, see Stephen Haber and Armando Razo, “Political Instability and
Economic Performance: Evidence from Revolutionary Mexico,” WorldPolitics 51,
1 (1998): 99–143; and Stephen Haber, Noel Maurer, and Armando Razo, “When
the Law Does Not Matter: The Rise and Decline of the Mexican Oil Industry,”
Journal of Economic History 63 (2003): 1–32. The comparison of the postrevo-
lutionary emergence of limited government in the United States against political
disorder in Latin America is developed in Douglass C. North, William Summerhill,
and Barry R. Weingast, “Order, Disorder and Economic Change: Latin American
versus North America,” in Bruce Bueno de Mesquita and Hilton L. Root, eds.,
Governing for Prosperity (New Haven, 2000), 59–84. This work employs a game-
theoretic model of constitutional commitment developed in Barry Weingast, “The
Economic Role of Political Institutions: Market-Preserving Federalism and Eco-
nomic Development,” The Journal of Law, Economics and Organization 11, 1 (1995):
1–31; “Constitutions as Governance Structures: The Political Foundations of Secure
Markets,” Journal of Institutional and Theoretical Economics 149, 1 (1993): 286–311;
and “The Political Foundations of Democracy and the Rule of Law,” The Amer-
ican Political Science Review 91, 2 (June 1997): 245–63. The most frequently cited
empirical application of this theory is Douglass C. North and Barry R. Weingast,
“Constitutions and Commitments: The Evolution of Institutions Governing Pub-
lic Choice in Seventeenth-Century England,” Journal of Economic History 49, 4
(1989), 803–32,anindispensable read in positive political economy.
Useful surveys of the positive theory of political economy and institutions are
Kenneth A. Shepsle and Barry R. Weingast, eds., Positive Theories of Congressional
Institutions (Ann Arbor, MI, 1995); and James A. Alt and Kenneth A. Shepsle, eds.,
Perspectives on Positive Political Economy (Cambridge, 1990). From an economist’s
transaction-cost viewpoint, see Avinash K. Dixit, The Making of Economic Policy: A
Transaction-Cost Politics Perspective (Cambridge, MA, 1996). A tractable approach
to political bargaining is developed in Gary Libecap, “Distributional Issues in Bar-
gaining for Property Rights,” Journal of Institutional and Theoretical Economics 145,
1 (1989): 6–24, with empirical applications in Libecap, Contracting for Property
Rights (Cambridge, 1989). This work and Elinor Ostrom, Governing the Commons:
The Evolution of Institutions for Collective Action (Cambridge, 1990) focus on com-
mon pool problems from poorly defined or communal property and explore formal