In This Review

The Politics of Freeing Markets in Latin America: Chile, Argentina, and Mexico
The Politics of Freeing Markets in Latin America: Chile, Argentina, and Mexico
By Judith A. Teichman
University of North Carolina Press, 2001, 288 pp.

This clearly written book tries to tease out how domestic and international influences interacted during the process of market reform in Latin America over two decades -- namely, the relationship between democratization and market liberalization in Chile, Argentina, and Mexico. In particular, Teichman investigates the role played by the World Bank and the International Monetary Fund and finds that domestic and international factors were indeed closely intertwined; in many cases, liberalization coincided with democratization. But reform itself was often achieved undemocratically, involving coalitions between foreign-trained technocratic elites, like-minded international officials, and powerful vested domestic interests. Hence when market reforms did not lead to improved living standards, they lost the support of civil society and political parties. Furthermore, when reforms failed to produce sustained growth, voters discredited pro-reform political leaders. In general, the public also repudiated reform if privatization was tainted by cronyism, a lack of transparency, or excessively weak regulation. Teichman's conclusions are especially pertinent now, in light of the IMF's and the World Bank's major roles in backing the policies that led to the recent turmoil in Argentina. In an appendix, she even lists the names of the World Bank officials who worked there between 1985 and 1995. They may be less than happy to see this list today.