Political Crises, Social Conflict and Economic Development
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Political Crises, Social Conflict and Economic Development

The Political Economy of the Andean Region

Edited by Andrés Solimano

The contributors to this authoritative volume analyze the impact of political crises and social conflict on economic performance in the Andean region of Latin America.
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Chapter 2: Political instability, institutional quality and social conflict in the Andes

Andrés Solimano


Andrés Solimano* 2.1 INTRODUCTION The Andean region of Latin America has experienced governance and economic difficulties that have compounded its structural problems of poverty, slow growth, inequality and financial volatility. Governance difficulties are reflected in a high turnover of authorities, low rankings in international indices of institutional effectiveness, recurrent political crises, violence (particularly acute in Colombia) and potentially fragile democracies.1 All these governance problems put clear obstacles to steady economic growth besides affecting the quality of democracy. The last few years have been marked by considerable political instability in the Andean region. Recently, in October of 2003, the Bolivian President Sánchez de Lozada was forced to resign following a sequence of social protests directed by groups of indigenous peoples and peasants. In April of 2002, for example, a failed coup d’état took place in which Venezuelan President Hugo Chávez was temporarily ousted from power only to regain the presidency a day later in a confusing set of events that involved the military and some leaders of the main business association. In Ecuador in January of 2000, the democratically elected President Jamil Mahuad was deposed by the military following an indigenous uprising in which a short lived military-indigenous junta took power for a few hours, only to eventually, under strong foreign pressure, turn power over to Vice President Gustavo Noboa. In 2000, Peru’s President Alberto Fujimori fled the country after a scandal of corruption and political intimidation that involved his Chief of Security, Vladimiro...

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