The reform of the three-tier system of government that the Danish society is about to implement is in accordance with the Danish tradition of structural reforms in the pre-war period. The agenda of the current reform derives naturally from the political debates and analyses that have taken place during the last forty years. Although the legislative background of the current reform is not yet in place, various tendencies imply that the reform will lead to more power being concentrated at the level of the state.
The future of structural reforms in Latin America is under discussion. The purpose of this document is to synthesize the facts and opinions that underlie this debate. The first section shows that although the reform process has not ground to a halt, it has been incomplete and uneven, both across countries and different areas of reform. The greatest progress has been made in reforming the trade and financial sectors. In terms of tax reform and privatization, the record has been mixed across countries. The most modest progress has been made in the area of labor code reform. The second section analyzes the status of public opinion of the reform process. Disillusionment with the reforms has been growing, particularly among the middle class. This disapproval, rather than reflecting concerns about the state of the economy or the degree of progress of the reforms, stems from the corruption that has tainted the privatization process in some countries. The third section reviews the effects of the reforms. Their impact on growth seems to have been positive, albeit temporary, but the effects on employment and income distribution have varied in different areas of reform and according to the particular context in each country. Specifically, the effectiveness of reforms has depended heavily on the quality of public institutions. The fourth section summarizes the main proposals to expand or reorient the reform agenda in the region. One set of proposals suggests broadening the Washington Consensus with more active policies aimed at addressing the need for greater economic stability, social integration and equitable income distribution. Another set of proposals, guided by a more encompassing view of the goals of development, emphasizes the interaction among civil society, the private sector, and the government. Finally, a more radical vision proposes a new national and international institutional architecture that would limit the role of markets and mitigate the effects of globalization. ; El futuro de las reformas estructurales en América Latina está en discusión. El objeto de este documento es resumir los hechos y las opiniones subyacentes de este debate. La primera parte muestra que si bien el proceso de reforma no se ha detenido del todo, sí ha sido incompleto y desigual, tanto entre países como entre las diversas áreas de reforma. Los mayores avances se han registrado en la reforma de los sectores del comercio internacional y las finanzas. En términos de reforma tributaria y privatización, los resultados de un país a otro son encontrados. Los avances más pequeños se han registrado en el área de la reforma del código laboral. En la segunda parte se analiza la situación de la opinión pública sobre el proceso de reforma. La desilusión con las reformas ha venido en aumento, especialmente entre la clase media. Más que reflejar inquietudes sobre el estado de la economía o el grado de avance de las reformas, esta crítica tiene que ver con la corrupción que ha empañado el proceso de privatización en algunos países. En la tercera sección se pasa revista a los efectos de las reformas. Sus repercusiones en el crecimiento parecen haber sido positivas, aunque pasajeras, pero sus efectos en el empleo y la distribución del ingreso han variado en diversas áreas de la reforma y según el contexto específico de cada país. En particular, la eficacia de las reformas ha dependido en gran medida de la calidad de las instituciones públicas. En la cuarta parte se presenta una síntesis de las principales propuestas para ampliar o reorientar el programa de reformas en la región. Un conjunto de propuestas sugiere ampliar el Consenso de Washington con políticas más activas, destinadas a acometer la necesidad de mayor estabilidad económica, integración social y una distribución equitativa del ingreso. Otro conjunto de propuestas, guiado por un punto de vista más amplio de los objetivos del desarrollo, hace hincapié en la interacción entre la sociedad civil, el sector privado y el gobierno. Por último, una visión más radical propone una nueva estructura nacional e internacional de las instituciones, a fin de limitar el papel de los mercados y atenuar los efectos de la globalización.
In the last twenty years, Brazil has undergone several attempts of improving sustainable growth through stabilization programmes, and more recently, structural reforms in line with the Washington Consensus Agenda. The results, however, have been disappointing, as the per capita output growth has remained below its historic trend, and poverty and inequality remain at high levels. This paper investigates why market-oriented reforms such as trade and capital account liberalization, privatization, deregulation and stabilization failed to boost growth in Brazil. We conclude that structural reforms may contribute to growth if accompanied by microeconomic policies tailor-made to address the country's needs, and by appropriate macroeconomic, institutional and political environments.
The wave of structural reforms in Latin America and elsewhere has stimulated the development of a wide body of theoretical literature on the political economy of reform, i. e. , the study of the political constraints that condition the timing, speed and sequencing of reforms. This paper tests some of the hypotheses associated with these theoretical models, using a set of structural reform indicators for approximately twenty Latin American countries for the period 1985-1995. Although there is strong support for some hypotheses, recent reforms in Latin America cannot be adequately explained without either better theories or better data.
This paper aims at contributing to the debate on the determinants of differentials in firms' productivity. The case of Italy looks particularly interesting, since it is characterized by a substantial and long-lasting productivity gap of industrial firms located in the Southern regions with respect to the rest of the country. We test the hypothesis that the macro factors, particularly the quality of institutions, play a central role in explaining Italian firms' productivity. Consistent with previous studies, our results show that institutional quality is one of the basic determinants of the observed TFP differentials across firms located in different Italian regions
We examine the macroeconomic consequences of industry wage bargaining and product market reforms. We suggest that general equilibrium effects may be important for the evaluation of industry-specific regulations. In particular, we suggest that the European unemployment problem can be traced back partially to insufficient recognition of general equilibrium effects. Moreover, unawareness of general equilibrium effects may be an explanation of why regulations are introduced and why structural reforms are (not) undertaken.
Un balance crítico de los modelos de desarrollo con los que se ha pretendido entregarle a América Latina mejores condiciones de crecimiento y equidad. Desde el modelo de sustitución de importaciones hasta las reformas estructurales de segunda generación, propias del final de la década de 1990, el continente ha debido enfrentar programas de ajuste macroeconómico, político y social que muy poco han contribuido a subsanar las difíciles condiciones estructu rales existentes. Sin embargo, quedan retos grandes hacia los años venideros, de tal manera que se pueda lograr la viabilidad económica y social de un continente plagado de frustraciones, retos que se habrán de enfrentar con gran responsabilidad y creatividad. ; This article presents a critica! appraisal of development models, which have been aimed to provide equity and economic growth conditions for Latin America . From the import-substitution model to the second generation of structural reforms at the end of the 1990's, the region has had to face macroeconomic, political and social adjustment programs, which have contributed too little to the prevailing structural conditions. However, there are important challenges in the coming years. Can economic and social feasibility be reached in a subcontinent plagued of frustrations? These challenges must be faced with great responsibility and creativity.
This paper argues that the cause of Japan's stagnation in the 1990s was not inefficient corporations, a failure to implement adequate reforms, or bad macroeconomic policy. The problem was more fundamental: a structural inadequacy of aggregate demand. By the middle 1980s Japan was approaching economic maturity, and its savings rate should have fallen as consumption replaced private non-residential investment as a source of new demand. Demographic factors, however, prevented this adjustment from taking place. Much of the population was now entering middle age, the stage of life in which people everywhere increase their savings in order to prepare for the exigencies of retirement. The behavior of these older people kept the savings rate elevated long past the point where such elevation was helpful; and the country consequently suffered from a surfeit of capital which, if not absorbed by some sector of the economy, might well have pushed it into a prolonged recession or even a depression. The most obvious way to resolve this imbalance would have been to ship the excess funds abroad through a much larger current account surplus. The government, however, could not weaken the yen in order to produce this effect because Japan's trading partners were complaining that it was already exporting too much and, perhaps paradoxically, because important domestic interest groups were also opposed to a policy of aggressive depreciation. Political considerations likewise prevented the government from enacting structural reforms that might have lowered the savings rate, as is evident in this paper's review of conditions both in the overall economy and in the automobile, retail, banking, and construction industries. By default, then, Japan was forced to rely on a combination of excessive corporate investment and ever larger government budget deficits as a means of employing capital and forestalling recession. This strategy cannot be adjudged a complete failure, for it bolstered demand and enabled the country to achieve GDP growth of some 1% per annum. But it was certainly suboptimal, leaving the economy highly inefficient and causing the national debt to increase dramatically. Japan would therefore have fewer resources with which to remedy its profound structural distortions when it finally attempted to do so in the 2000s and 2010s.
Since the mid-1980s a profound change of direction in the structural policies of the region has taken place. The development model based on protecting national markets and state intervention was replaced by a set of policies aimed primarily at seeking to improve efficiency, facilitate the operation of markets, and reduce the distorting effects of state intervention in economic activities. An earlier version of this article (Lora, 1997) was prompted by the absence up to that time of measurements of progress in reforms. As was then argued, the lack of direct measurements of structural policies had stood in the way of adequately evaluating the effects of the reforms on economic growth and other variables. The few studies that had attempted to analyze the effects of the reforms had used result variables, such as the foreign trade ratio of the economy, or the size of public spending, or financial depth, rather than policy variables, such as tariffs, tax rates, or reserve requirement ratios. The indices of reform that were proposed at that time served as the basis for various studies that analyzed the effects of the reforms and stimulated the construction of other reform indicators.
This paper examines the policy process involved in the development and implementation of the 1997 Aged Care Structural Reform Package in Australia by the Liberal-National Coalition Government. It will be argued that the process used to implement the Reforms and the convoluted path it took is best explained using Paul Pierson's theory of the politics of welfare retrenchment. The strategies Pierson identifies as important to programmatic and systematic retrenchment were used with varying degrees of success by the Coalition to implement the Aged Care Reforms and include obfuscation, division and compensation. The effectiveness of these strategies in implementing the Aged Care Reforms was dependent on the political context of aged care policy inherited by the Coalition from the previous Labor administration. The political context is defined in terms of the formal political institutions, the design of aged care policy and the degree to which this has supported the development and maintenance of interest groups. The 1997 Reforms themselves have fundamentally altered the political context and the implications for future administrations are discussed.
We test the significance of the relationship between the exchange rate regime and the degree of structural reforms by estimating panel regressions for a world and an OECD country sample. The empirical results suggest a positive correlation between on the one side the adoption of an exchange rate rule and on the other side overall structural reforms as well as reforms in the money and banking sector in the broad country sample. For government size and for market regulation, we do not find any robust significant effect, however. The results do not confirm the main implication of Calmfors-type models, namely a higher degree of reforms under monetary policy autonomy. They corroborate conditional policy convergence and, partly, that limiting monetary policy autonomy fosters structural reforms.
This paper seeks to contribute to the ongoing controversy on the distributional effects of structural reforms in developing countries. To this end, we set up a small-scale macroeconomic model of a dual economy to capture the transmission mechanisms through which the deregulation of product and factor markets, the liberalization of the trade and FDI regime, and the privatization of public companies impact on the distribution of employment and wages between the formal and the informal sector. We empirically test the implications of our theoretical model in a detailed case study on the structural reform process in Bolivia since 1985.
During the past decade, structural polices in the region have been aimed increasingly at improving economic efficiency and reducing government interference in economic decisions. The effects of this shift have not yet been accurately evaluated due to the lack of systematic measurements of the magnitude of structural reforms. The aim of this document is to summarize the most characteristic features of the reform process during the past decade and to propose a method for quantifying the state of structural policies
Paper presented at the International Conference: "Territorial Governance for the 21st Century", Royal Flemish Academy of Belgium for Arts & Sciences, Brussels, 16-17 September 2005. Published in: J. Loughlin, John y K. Deschouwer, Kris (eds.), Territorial Governance for the 21 st Century , pp. 55-63. Bruselas: Kloninklijke Vlaamse Academie van België voor Wetenschappen en Kunsten. Sept. 2005 ; Europeanization can be regarded as a process that finds expression in the gradual redefinition of state sovereignty and the development of supranational common institutions (e.g. Agreement of Schengen, Court of Justice, Euro currency). In parallel, territorial subsidiarity seeks to provide for a greater sub-state say in areas of social policy-making often linked to cultural or identity considerations. This paper deals with welfare development in the European social model in contemporary times. While a paradigm shift in macro-economic policies has allowed for monetary centralisation and a growing matching of EU internal 'open' markets, the quest for the decentralization of welfare programmes has also aimed at meeting demands for policy innovation and a more effective management. Allegedly, welfare provision by sub-state diversity may affect collective solidarity and redistribution. The emergence of new social risks and the role played by the mesogovernments in welfare reform in Europe are also subject to analysis and discussion in this paper. ; Peer reviewed
"Serial no. 107-14." ; Shipping list no.: 2002-0107-P. ; Distributed to some depository libraries in microfiche. ; Includes bibliographical references. ; Microfiche. ; Mode of access: Internet.
