In this paper I argue that political-economy considerations –and in particular the identity of the reformers- are central to understanding the Argentine crisis. During the 90´s the main political parties remained attached to populism, and no strong party emerged at the center of the political spectrum. This had two effects in the reform process. First, it severely deteriorated it (efficiency, corruption), reducing the support of the population. Second, when a series of shocks hit the economy the anti-reform camp tried to undo most reforms, and thus convey a message to the population about the “right” model of the world.
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Length: 39 pages Date of creation: 29 Apr 2003 Date of revision: Handle: RePEc:wdi:papers:2003-594
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Find related papers by JEL classification: F31 - International Economics - - International Finance - - - Foreign Exchange E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
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Guillermo A. Calvo & Carmen M. Reinhart, 2000.
"Fear of Floating,"
NBER Working Papers
7993, National Bureau of Economic Research, Inc.
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