The Political Economy of Recent Conversions to Market Economics in Latin America

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Abstract
The objective of this article is to attempt to explain why free market open economy policies (FMOEP) have become so popular in Latin America in the 1990s. There are six possible major explanatory factors: (i) lessons learnt from the debt crisis and its immediate aftermath, (ii) more highly qualified technocrats, (iii) development of an entrepreneurial middle class, (iv) exhaustion of import substituting industrialisation, (v) a combination of tax reform, financial modernisation and export diversification, and (vi) a favourable public opinion. Yet none of these factors by itself was a sufficient condition for FMOEP; necessary factors were different from country to country, and the nature of the interaction between two or more factors was different in each country.