[lbo-talk] Ecuador Approves Changes to Constitution

Sean Andrews cultstud76 at gmail.com
Mon Apr 16 21:39:54 PDT 2007


On 4/16/07, Yoshie Furuhashi <critical.montages at gmail.com> wrote:
> I love good news like this, _even_ from Simon Romero, especially news
> that includes Iran with Venezuela, Bolivia, and Ecuador. :-> It
> almost compensates for the alarming development in Turkey that I
> learned about from Sabri Oncu. -- Yoshie

Yes. But I also think that Correa is a ball of contradictions. What are other people's takes on him. He is obviously riding Chavez's Bolivarian wave, but he is also a PhD economist from Chicago (Urbana-Champaign), which hasn't always ended up making things better.

However, his thesis is an explicit critique of the Washington Consensus, even if it uses economics as the method of critique. Here is the abstract:

<BLOCKQUOTE> Since the mid-1980s, most Latin American countries began an accelerated process of structural reforms in the line of the so-called "Washington Consensus". The first chapter of the dissertation tests the robustness of former evidence showing a positive correlation between the reforms and the Latin-American economic growth or the respective sources of growth. The results are notable. No reform is robustly correlated with the expected sign with growth, investment, or productivity growth, and there is strong econometric evidence that some reforms, and particularly labor deregulation, are harming productivity growth. The results also show positive time effects for the period 1987-1995, contradicting the prevailing wisdom of negative time effects justifying the poor Latin American economic performance despite the many and deep structural reforms.

Chapter 2 analyzes the economic desirability of a common currency for the Andean Community of Nations (CAN). The evidence shows that the CAN has not yet created an actual Andean market, and that the volatility of the bilateral exchange rates is a significant factor for this poor result. The evidence also demonstrates that the heterogeneous macroeconomic performance observed between the Andean countries is explained not because idiosyncratic shocks, but rather because of the different size of responses and speed of adjustment to common shocks.

Finally, using improved policy indices Chapter 3 evaluates the impact of the structural reforms on the quantity and quality of economic growth in Latin America. Conditional probability analysis shows that high reforms are neither necessary nor sufficient to achieve high growth. In addition, regression analysis reveals no evidence of the reforms being growth enhancing. Further evidence shows that labor deregulation and trade liberalization are negatively correlated with human development growth and the latter is also positively correlated with inequality in the region. Finally, the results show that the unobserved country capabilities computed using panel regressions reflect human development and are independent of the level of structural reforms. <END BLOCKQUOTE>

I've heard people accusing him of opportunism, but it seems like he basically revolted from the previous administration based on World Bank rangling and got a good amount of popular support for it and then decided to try to use that credibility to make some changes. In any case, I am interested in watching this very carefully as I'm going down for a visit over the summer. So if anyone has good sources on him or the changes going on in Ecuador, please pass them along.

s



More information about the lbo-talk mailing list