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The Political Economy of Macroeconomic Policy Reform in Latin America

The Distributive and Institutional Context Eduardo Wiesner is an Colombian Economist with degrees from the Universidad de los Andes (summa cum laude) in Bogotá and Stanford University. He is a Former Minister of Finance and Director of Colombia’s National Planning Department. He has held senior positions in the International Monetary Fund, the World Bank and the Inter-American Development Bank, and is currently with Wiesner and Associates, Colombia
Eduardo Wiesner’s book makes an important contribution to the understanding of development by blending together the interdependent issues of (i) macroeconomic performance and volatility, (ii) equity and distributive justice, (iii) fiscal deficits and the redistributive effectiveness of social public expenditures, and (iv) the demand for the ‘right’ institutions and for policy reform in Latin America. It does this by examining recent macroeconomic crises from a political economy perspective, and finds that information is the critical algorithm that links together the demand for macroeconomic stability, macroeconomic performance and, ultimately, distributive justice.
Extent: 296 pp
Hardback Price: $156.00 Web: $140.40
Publication Date: 2008
ISBN: 978 1 84720 579 7
Availability: In Stock
Paperback Price: $74.00 Web: $59.20
Publication Date: 2009
ISBN: 978 1 84844 460 7
Availability: In Stock
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  • Development Studies
  • Development Economics
  • Development Studies
  • Economics and Finance
  • Development Economics
  • Political Economy
  • Politics and Public Policy
  • Political Economy
Eduardo Wiesner’s book makes an important contribution to the understanding of development by blending together the interdependent issues of (i) macroeconomic performance and volatility, (ii) equity and distributive justice, (iii) fiscal deficits and the redistributive effectiveness of social public expenditures, and (iv) the demand for the ‘right’ institutions and for policy reform in Latin America. It does this by examining recent macroeconomic crises from a political economy perspective, and finds that information is the critical algorithm that links together the demand for macroeconomic stability, macroeconomic performance and, ultimately, distributive justice.

This volume is geared toward those interested in the political economy of development and policy reform in general and in Latin America, including academics, policy makers, and the general reader.
‘This book is a must read for anyone interested in policy reforms in Latin America. The author combines tremendous experience in the field and deep knowledge of economic theory: a rare combination.’
– Alberto Alesina, Harvard University, US

‘One of the key contributions of this book is its insistence on the importance of policy, institutional and political accountability for evaluating and enhancing macroeconomic performance and for reducing inequality.’
– John B. Taylor, Stanford University and Hoover Institution, US

‘Dr Wiesner combines a command of modern political and economic theories and detailed knowledge of Latin America to clarify why reform of policies and institutions has proved so difficult in that region. His general conclusion is that initial conditions of inequality and poverty reduce the demand for reform, but he finds that the process manifests itself differently in different countries. He identifies several necessary conditions for breaking out of these vicious circles. Scholars and practitioners alike can learn from his impressively thorough and detailed analysis.’
– Avinash K. Dixit, Princeton University, US

‘This book argues insightfully that underdevelopment is the result of the political economy difficulties some countries have in the effectiveness of public expenditures in general and of social pro-poor expenditures in particular. The policy implication is that reform strategies should focus on identifying the “wrong” political incentives in public expenditures.’
– Ricardo Hausmann, Harvard University, US
Contents: Part I: Conceptual Framework Introduction 1. Overview: The Current Status and Prospects of the Reform Process 2. The Political Economy of Macroeconomic Policy Making in Latin America Part II: Country Narratives and Comparative Economics 3. Argentina: Blinded by Hindsight – The Economics and Politics of Learning 4. Brazil: The Market Enhancing Role of Political Economy Factors 5. Chile: The Right Mix of Policies and Institutions 6. Colombia: Fairness Perception and the Political Tolerance for Macroeconomic Policy Reform 7. Costa Rica: The Effectiveness of Political Economy Compromise 8. Peru: From Macroeconomic Volatility to Credibility Building References Index