Media, Development, and Institutional Change
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Media, Development, and Institutional Change

Christopher J. Coyne and Peter T. Leeson

Media, Development, and Institutional Change investigates mass media’s profound ability to affect institutional change and economic development. The authors use the tools of economics to illuminate the media’s role in enabling and inhibiting political–economic reforms that promote development.
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Chapter 1: The Big Picture: Media, Development, and Institutional Change

Christopher J. Coyne and Peter T. Leeson


INTRODUCTION Following the election of President Alberto Fujimori in Peru in July 1990, Vladimiro Montesinos was named chief of the Servicio de Inteligencia Nacional (SIN), Peru’s national intelligence service. Prior to this appointment, Montesinos had been a captain in the Peruvian army, an aide to the army chief and prime minister of Peru, and a private lawyer. In his position as chief of SIN, Montesinos served as Fujimori’s chief advisor and had nearly unlimited power. Indeed, many considered Montesinos to be more powerful than the President in the daily operations of Peru. In addition to repressing political opponents through threats and violence, Montesinos was also involved in embezzlement, bribery, and drug trafficking. The extent and magnitude of his corruption became evident in 2000. In September 2000, a videotape surfaced of Montesinos paying a $15 000 bribe to opposition political leader Alberto Kouri to defect and support Fujimori. Shortly thereafter, political opponents of Montesinos aired the scandalous footage. At first the only television channel in Peru to repeatedly broadcast the video of Montesinos’s corruption was Channel N, the only private television channel in the country not on Montesinos’s payroll. However, as word of the video spread, other television stations, including those previously under Montesinos’s control, began airing the video as well. In addition to his meeting with Kouri, Montesinos had videotaped himself in meetings with judges, political leaders, and members of the media, bribing them as well. Following the broadcast of the Montesinos– Kouri video, these other videos of Montesinos’s corruption...

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