Political Economy of Responses to Economic Crises: Comparative Lessons from Latin America

Abstract

How do governments respond to economic crises? What lessons can be extracted from previous crises? This panel tackles these two questions by analyzing the crafting, contents and political dynamics of responses to the 2008-09 crisis and comparing them with previous crisis episodes. Responses to crises can be studied focusing on the contents of stabilization policies, the determinants of their nature and timing, their consequences on the polity and economy, and the political dynamics of their inception. Extant research on the responses to the 2008-09 crisis have dealt with most of these topics, but typically in a synchronic perspective, comparing across countries and regions. This panel intends to expand such comparisons to previous economic crises. Introducing this historical perspective will enable political analysis to better assess the effect of structural economic and political determinants, as well as to weigh in cognitive factors – such as the evolution of ideas and the experience with crises – and trajectories in the shaping of both policy options and political management strategies. The papers also intend to discuss what lessons can government elites in industrialized nations extract from the more crisis-experienced Latin American region.