The Political Economy of the Welfare State in Latin America: Globalization, Democracy, and Development

Cover......Page 1
Half-title......Page 3
Title......Page 5
Copyright......Page 6
Dedication......Page 7
Contents......Page 9
Tables and Figures......Page 13
Acknowledgments......Page 19
1 Introduction......Page 23
1.1 The Welfare State: Review of Main Theories......Page 28
1.2 The Welfare State: Latin America in Comparative Perspective......Page 32
1.3 Methodology......Page 38
1.4 Chapter Outline......Page 42
2 The Historical Evolution of Welfare Systems in Latin America: Qualitative Comparative Analysis......Page 46
2.1 The Emergence of Welfare Systems in Latin America......Page 48
2.2 Brief Review of Main Theoretical Perspectives: Defining the Independent Variables......Page 53
Economic Development......Page 54
Trade Openness......Page 56
Democracy......Page 59
Left-Labor Power......Page 63
2.3 Qualitative Comparative Analysis through the Boolean Methodology......Page 70
Chile......Page 76
Uruguay......Page 79
Argentina......Page 81
Brazil......Page 84
Costa Rica......Page 86
2.5 The Trajectories of the Group of Low Welfare Effort Countries (Non-Welfare States)......Page 88
2.6 Summary and Conclusion......Page 91
APPENDIX 2.1: BASIC FEATURES OF QCA......Page 94
Prime Implicated Variables and Reduced Equations......Page 97
3 Theoretical Framework and Main Hypotheses......Page 99
Wagner’s Law......Page 101
Baumol’s Cost Disease......Page 102
The Role of Budget Constraints: Revenue Effort and Fiscal Deficits......Page 105
Globalization: The Critical Importance of Trade Openness and Capital Mobility......Page 111
Trade Openness and the Welfare State: How Does Trade Integration Affect Welfare Effort?......Page 112
Capital Mobility......Page 123
The Role of Democracy in the Previous Welfare State Literature......Page 127
Theoretical Perspectives on the Link between Democracy and Social Spending......Page 129
The Measurement of Democracy......Page 135
Parties, Unions, and Popularly Based Governments......Page 137
Voter Turnout......Page 143
Constitutional Structures......Page 145
3.3 Conclusion......Page 147
4 Determinants of Social Spending in Latin America: A Time-Series Cross-Section Analysis, 1973–2003......Page 149
4.1 Data Sources, Research Design, and Model Specification......Page 150
Dealing with Heterogeneity in Causal Processes......Page 153
The Dependent Variable......Page 156
Globalization......Page 158
Popularly Based Presidents......Page 160
Other Relevant Economic and Control Variables......Page 161
4.3 The Model......Page 164
Aggregate Social Spending......Page 167
The Impact of Globalization......Page 170
Fiscal-Constraint Variables......Page 171
Control Variables......Page 172
Disaggregated Results of Social Security and Health and Education......Page 173
Globalization......Page 178
Fiscal Constraints......Page 182
Political Variables......Page 183
Extension: Interaction Effects......Page 184
4.5 Conclusion......Page 189
APPENDIX 4.1: DESCRIPTION OF VARIABLES......Page 192
APPENDIX 4.2: THE ERROR CORRECTION MODEL......Page 194
5 Chile: A Classic Latin American Welfare State under Authoritarian Stress (1973–1989) and Democratic Reinvention (1990–2000)......Page 196
5.1 Historical Antecedents of the System (1920–1973)......Page 198
5.2 A Welfare System under Stress: Comparative Patterns of Social Spending under Authoritarianism (1973–1989)......Page 199
Decomposing Social Spending into Its Components......Page 206
The Restructuring of the Welfare System during Pinochet’s Military Regime......Page 210
The Relationship between Trade Liberalization and Social Expenditures......Page 213
The Relationship among Structural Reforms, Trade Openness, and the Chilean Welfare System, 1973–1989......Page 215
5.4 Patterns of Social Spending and Social Policy after the Transition to Democracy (1990–2000)......Page 220
5.5 Summary and Conclusion......Page 226
6 Costa Rica: Globalization, Gradual Reform, and the Politics of Compensation, 1973–2002......Page 229
6.1 Brief Historical Antecedents of the System (1940–1973)......Page 230
Phase I: Sustained Expansion (1972–1980) and Temporary Collapse (1980–1982)......Page 232
Phase II: Gradual Economic Adjustment and Recovery of Social Spending Levels, 1982–1990......Page 235
Phase III: Continued Reform and Dilemmas of the Costa Rican Welfare State (1990–2002)......Page 237
6.3 The Links among Economic Reform, Globalization, and Social Policies in Costa Rica......Page 240
6.4 The Essence of the Costa Rican Experience: International Factors, Domestic Political Institutions, and the Politics of Gradual Reform and Social Compensation......Page 244
International Factors......Page 245
Democratic Political Institutions......Page 246
6.5 Conclusion......Page 249
7 Peru: Political Instability, Regime Change, and Late Economic Reform in a Non-Welfare State, 1973–2000......Page 251
7.1 Origins of the Peruvian Non-Welfare System......Page 253
The Military Governments of Velasco Alvarado (1968–1975) and Morales Bermúdez (1976–1979)......Page 255
Fernando Belaúnde (1980–1985)......Page 258
Alan García (1985–1990)......Page 261
The 1980s: Anatomy of an Economic and Social Policy Failure......Page 264
The First Government of Alberto Fujimori (1990–1992)......Page 265
7.3 Social Policies under Fujimori’s Authoritarian Rule (1991–2000)......Page 266
The Economic Basis of the Expansion of Social Expenditures......Page 267
The Decline of Pensions and Other Work-Related Social Benefits......Page 269
The Political Determinants of the Expansion of Poverty-Relief Expenditures......Page 274
7.4 Conclusion......Page 278
8 Conclusion: Summary and Final Reflections on the Sustainability and Effectiveness of Latin American Welfare Systems......Page 281
Historical Origins and Development of Latin American Welfare Systems 1920s–1970s......Page 282
The Evolution of Latin American Welfare Systems in the Era of Globalization and “Third Wave” Democratization, 1973–2003......Page 286
Country Experiences: Beyond the Black Box of Social Expenditures......Page 288
The Long-Term Sustainability of Social Expenditures......Page 293
The Effectiveness of the Welfare State......Page 298
Bibliography......Page 303
Index......Page 327