Latin America’s Political Economy: Development Patterns

Latin America’s political economy has always drawn the attention of development researchers, since the vast relations with US, interaction with the world economy and active participation in the global trade created the expectation that the region would soon overcome its development challenges and join the club of the developed countries. Although the region has Brazil, Mexico and Argentina amongst the G-20 top world economies, the three have an accumulated debt of more than one trillion dollars, and repaying the foreign debts will overshadow all economic development strategies. This article intends to respond to the question that “why a region with considerable amount of means to develop, and enjoying relative democratic institutions and friendly relations with superpowers is still coping with the primary challenges of development and suffering from issues like populism, corruption, non-transparency, drug trafficking and social rifts. The article departs from the hypothesis that the concentration of political power and economic resources in the hands of Latin American oligarchy have institutionalized structural weaknesses, distancing in this way countries from their development objectives. Despite considerable progresses in the fields of industry, services and intellectual properties, Latin American countries have not been able to diversify their economies in an efficient manner and continue being agricultural exporters, lagging behind the globalization process regardless of their integration to the global economy.