This title was first published in 2001. An analysis of the political economy of Mexico's financial reform. It is organized in three parts. The first part - chapters one to four - develops the framework, both historical and institutional. The first chapter outlines the theoretical discussion on state autonomy and develops a simple analytical framework to study public policy decisions. The subsequent three chapters address three main themes: external dependency of domestic states on international capital, political change under President Carlos Salinas and financial policy in Mexico. The second part presents the analysis of three main institutional changes to the financial system - development banking reform, commercial banking privatisation and autonomy of the central bank. Each specific case study shows how the reforms conformed to the ideas of the dominant consensus on economic policy and how they delivered an inefficient incentive structure. The third part - chapter eight - brings together all the elements to explain Mexico's 1994 financial crisis.

"Cover"--"Half Title" -- "Dedication" -- "Title" -- "Copyright" -- "Contents" -- "List of Figures" -- "List of Tables" -- "List of Abbreviations" -- "Introduction" -- "1 State Autonomy and Policy Reform: A Theoretical Framework" -- "2 The Politics of International Finance: Fostering Reform" -- "3 Domestic Politics: Making the Reform Possible" -- "4 Financial Policy in Mexico: A Historical Account" -- "5 Development Banking Reform" -- "6 Commercial Banks' Privatisation" -- "7 Banco de Mexico's Autonomy" -- "8 The Political Economy of Mexico's 1994 Financial Crisis" -- "Conclusions" -- "Notes" -- "Bibliography

Economic Policy Reform in Mexico: A Case Study for Developing Countries is a five-chapter text about political economy that tries to assess the economic developments in Mexico, especially the attempt at economic reform in the early 1970s. The first chapter examines the period of Stabilizing Development to provide a framework necessary for judging the environment in which the attempts at economic reform were undertaken. This chapter is a piece of applied economics that tries to assess the too frequent attacks against that phase of economic policy. The following three chapters discuss the economic policy objectives of Echeverria's administration, the attempt at tax reform, and the change in the structure and practices of public spending. The final chapter evaluates the experience and draws some inferences about the nature of decision making in economic policy and the constraints faced by a government that wants to use economic policy as an instrument for the promotion of social welfare. This book will prove useful to economists, historians, and researchers.

In States, Banks, and Markets Nancy Neiman Auerbach approaches financial policymaking as a strategic interaction between two sets of domestic actors: private financiers and state officials. Through a comparative lens, Auerbach explains why the transition to financial liberalization was accompanied by economic crisis and declining growth rates in countries such as Mexico, while the same policy was associated with higher growth rates and a relatively more equitable distribution of income in other countries such as South Korea and Hong Kong.Auerbach first sets up a theoretical foundation that underlies the comparative case studies, and she then follows with a detailed account of Mexico's transition to financial liberalization in the 1980s. The author systematically compares various countries' cases--Germany, South Korea, Hong Kong, Turkey--with Mexico as a means of underscoring the central and recurring themes illustrated by financial market politics in newly industrializing countries. The author then returns to her analysis of Mexico with an examination of the Mexican peso crisis in light of the recent financial crises in Asia. Auerbach not only demonstrates how the timing and duration of the liberalization process is the element differentiating the performance of newly industrializing countries (rather than financial liberalization itself), for she takes the analysis a step further by explaining the economic and political preconditions that put a country in the position to choose a reasonable reform path.

The last two decades saw a host of governments abandon statist development models for more market-friendly ones. However, not all reform attempts fared equally well. Why do some governments succeed in implementing market reforms while others fail? Why might the same government succeed in one policy area but not another? Market Reforms in Mexico explores these central questions by examining Mexico's reform experience in privatization, deregulation, and environmental policy. More than simply a book on 'Mexican politics,' this study speaks to the broader political dynamics behind the success or failure to implement reforms; first, by assessing new policy initiatives in multiple arenas across presidential administrations in Mexico, then by comparing Mexico's privatization experience to that of Argentina's. Through structured, focused comparison of select case studies, the author argues that the fate of dramatic reform initiatives turned on coalition politics (both inside and outside the state), and explains how institutional dynamics and the capacity to solve the problem of policy 'costs' strongly affected reformers' prospects of success.