Reforming States and Markets in the 1990s, Article Review Example

The Latin American markets have undergone massive transformations throughout the 1990’s. The same case applies to states in this region. The states, according to an article by Weyland (1998), went through very painful neoliberal reforms during this period. The article draws on the explanatory power derived from two contrasting hypotheses: compensation and rescue hypothesis.

The compensation theory roots for government-engineered support, leading to costly reforms, whereby losers are compensated through special social reform processes. On the other hand, the rescue hypothesis is based on the principle of draconian reforms as the only way through which further losses can be prevented in time of economic crises. Both hypotheses are analyzed and illustrations are given using reform experiences in Argentina and Peru in 1995.

According to the Heredia and Schneider (2003), administration reforms have been done in many developing countries. In the process, government functions have been altered. Others changes include cuts in investment, personnel reduction, devolution, privatization and deregulation.

In the article, two waves of administrative reforms are proposed. The first one is seen to leave behind novel pressures and devolved bureaucracies that barely function. The second generation of reforms centers on rebuilding administrative capacities and normalizing the operations of all institutions.

In the quest for civilian democracy, Latin America has had to institute many monetary, fiscal and trade reforms (Remmer, 2003). Although the going has been tough economically and politically, market based strategies seem to have worked rather well in order to strengthen these civilian democracies. Remmer (2003), highlights the effects that these reforms have on Latin American domestic politics.