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Stabilization and growth under dictatorship: the experience of Franco's Spain

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  • Sanz Villarroya, Isabel
  • Rosés, Joan R.
  • Prados de la Escosura, Leandro

Abstract

Stabilizing and liberalizing policies are key elements of the Washington Consensus. This paper adds a historical dimension to the ongoing debate by assessing the economic impact of market-oriented reforms undertaken during General Franco’s dictatorship, the 1959 Stabilization and Liberalization Plan. Using an index of macroeconomic distortions (IMD) the relationship between economic policies and the growth record is examined. Although a gradual reduction in macroeconomic distortions was already in motion during the 1950s, the 1959 Plan opened the way to a new institutional design that favoured a free-market allocation of resources and allowed Spain to accelerating growth and catching up with Western Europe. Without the 1959 Plan, per capita GDP would have been significantly lower in 1975.

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  • Sanz Villarroya, Isabel & Rosés, Joan R. & Prados de la Escosura, Leandro, 2010. "Stabilization and growth under dictatorship: the experience of Franco's Spain," IFCS - Working Papers in Economic History.WH wp10-02, Universidad Carlos III de Madrid. Instituto Figuerola.
  • Handle: RePEc:cte:whrepe:wp10-02
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    Cited by:

    1. Crafts, Nicholas, 2011. "The Marshall Plan: A Reality Check," CAGE Online Working Paper Series 49, Competitive Advantage in the Global Economy (CAGE).
    2. Crafts, Nicholas, 2012. "Western Europe's Growth Prospects: an Historical Perspective," CEPR Discussion Papers 8827, C.E.P.R. Discussion Papers.

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    More about this item

    Keywords

    Macroeconomic policy;

    JEL classification:

    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • N14 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: 1913-
    • N44 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: 1913-
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth

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