Globalization, domestic politics and the welfare state in the developing world: Latin America in comparative perspective, 1973--1997 (Costa Rica, Chile, Peru)

This dissertation uses qualitative comparative analysis (QCA) to examine the different historical paths through which Latin American countries have constructed their welfare systems; time-series cross-section data (TSCS) to analyze how these welfare systems have been transformed by the more recent processes of globalization and democratization; and three case studies to take the analysis of welfare systems beyond the black box of social expenditures and to discover the specific causal mechanisms underlying statistical associations among variables. The bulk of the dissertation analyzes the 1973–1997 period—a period of time in which most Latin American countries completed transitions to democracy and became far more integrated to international trade and capital markets than ever before.; I show that trade integration had a consistently negative effect on governments' fiscal and macroeconomic commitment to social expenditures, and that this effect was compounded by openness to capital markets. I also find that popularly-based governments tended to protect social security transfers, which flowed disproportionately to their unionized constituencies, but had a negative impact on health and education spending. Conversely, the change to democracy led to increases in health and education spending, which reached a larger segment of the population. I then emphasize the contrasting political logics of the different types of social spending, and complete the analysis with three case studies—Costa Rica, Chile and Peru. The case studies are aimed at specifying causal mechanisms better and consider other aspects of the welfare state than cannot be captured by spending measures alone. I conclude with an analysis of the long-term sustainability of welfare systems in the region, and a brief comparative overview of the relationship between social expenditures and income inequality in the OECD and in Latin America.