ON THE CRISIS HYPOTHESIS OF ECONOMIC REFORM: COLOMBIA 1989-91

On July 1999 Colombia entered into an extended facility agreement with the IMF. Clearly, problems currently affecting Colombia go well beyond economics, as political and social tensions have intensified. Many of the policies contemplated in the IMF program had already been addressed in the late 1980...

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Autores principales:	EDWARDS,SEBASTIÁN, STEINER,ROBERTO
Lenguaje:	English
Publicado:	Instituto de Economía, Pontificia Universidad Católica de Chile 2000
Materias:	Colombia structural reforms political economy
Acceso en línea:	http://www.scielo.cl/scielo.php?script=sci_arttext&pid=S0717-68212000011200003
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spelling	oai:scielo:S0717-682120000112000032002-04-30ON THE CRISIS HYPOTHESIS OF ECONOMIC REFORM: COLOMBIA 1989-91EDWARDS,SEBASTIÁNSTEINER,ROBERTO Colombia structural reforms political economy On July 1999 Colombia entered into an extended facility agreement with the IMF. Clearly, problems currently affecting Colombia go well beyond economics, as political and social tensions have intensified. Many of the policies contemplated in the IMF program had already been addressed in the late 1980s and early 1990s. Indeed, during the final years of the Barco administration an economic reform program was initiated. This was intensified during the first two years of César Gaviria's presidency. The purpose of this paper is to analyze, from a political economy perspective, the launching of the Colombian market-oriented reforms in 1989-91. We are specially interested in investigating whether the so called "crisis hypothesis" applies to Colombia. This hypothesis is based on the observation made by a number of scholars, that a major economic crisis almost always precedes the launching of a reform effort. We argue that although Colombia was not facing a major economic crisis, it was facing a severe political and institutional breakdown. The profound attention devoted by key actors to political issues gave President Gaviria ample room to maneuver in the economic reform front. As a result, his first six months in office were truly remarkable in terms of economic reform. However, following the enactment of a new Constitution, interest groups negatively affected by the reforms were able to regroup, and started to actively lobby to stall the modernization process. As a result, the reformist effort slowed down significantly. Worse, many of the constitutional mandates placed Colombia on an unsustainable fiscal pathinfo:eu-repo/semantics/openAccessInstituto de Economía, Pontificia Universidad Católica de ChileCuadernos de economía v.37 n.112 20002000-12-01text/htmlhttp://www.scielo.cl/scielo.php?script=sci_arttext&pid=S0717-68212000011200003en10.4067/S0717-68212000011200003
institution	Scielo Chile
collection	Scielo Chile
language	English
topic	Colombia structural reforms political economy
spellingShingle	Colombia structural reforms political economy EDWARDS,SEBASTIÁN STEINER,ROBERTO ON THE CRISIS HYPOTHESIS OF ECONOMIC REFORM: COLOMBIA 1989-91
description	On July 1999 Colombia entered into an extended facility agreement with the IMF. Clearly, problems currently affecting Colombia go well beyond economics, as political and social tensions have intensified. Many of the policies contemplated in the IMF program had already been addressed in the late 1980s and early 1990s. Indeed, during the final years of the Barco administration an economic reform program was initiated. This was intensified during the first two years of César Gaviria's presidency. The purpose of this paper is to analyze, from a political economy perspective, the launching of the Colombian market-oriented reforms in 1989-91. We are specially interested in investigating whether the so called "crisis hypothesis" applies to Colombia. This hypothesis is based on the observation made by a number of scholars, that a major economic crisis almost always precedes the launching of a reform effort. We argue that although Colombia was not facing a major economic crisis, it was facing a severe political and institutional breakdown. The profound attention devoted by key actors to political issues gave President Gaviria ample room to maneuver in the economic reform front. As a result, his first six months in office were truly remarkable in terms of economic reform. However, following the enactment of a new Constitution, interest groups negatively affected by the reforms were able to regroup, and started to actively lobby to stall the modernization process. As a result, the reformist effort slowed down significantly. Worse, many of the constitutional mandates placed Colombia on an unsustainable fiscal path
author	EDWARDS,SEBASTIÁN STEINER,ROBERTO
author_facet	EDWARDS,SEBASTIÁN STEINER,ROBERTO
author_sort	EDWARDS,SEBASTIÁN
title	ON THE CRISIS HYPOTHESIS OF ECONOMIC REFORM: COLOMBIA 1989-91
title_short	ON THE CRISIS HYPOTHESIS OF ECONOMIC REFORM: COLOMBIA 1989-91
title_full	ON THE CRISIS HYPOTHESIS OF ECONOMIC REFORM: COLOMBIA 1989-91
title_fullStr	ON THE CRISIS HYPOTHESIS OF ECONOMIC REFORM: COLOMBIA 1989-91
title_full_unstemmed	ON THE CRISIS HYPOTHESIS OF ECONOMIC REFORM: COLOMBIA 1989-91
title_sort	on the crisis hypothesis of economic reform: colombia 1989-91
publisher	Instituto de Economía, Pontificia Universidad Católica de Chile
publishDate	2000
url	http://www.scielo.cl/scielo.php?script=sci_arttext&pid=S0717-68212000011200003
work_keys_str_mv	AT edwardssebastian onthecrisishypothesisofeconomicreformcolombia198991 AT steinerroberto onthecrisishypothesisofeconomicreformcolombia198991
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ON THE CRISIS HYPOTHESIS OF ECONOMIC REFORM: COLOMBIA 1989-91

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