From Neoliberalism to Neo-developmentalism? The Political Economy of Post-crisis Argentina (2002–2015)

Argentina’s post-crisis political economy was viewed as part of the emergence of a post-neoliberal governance and the rise of New Left governments in Latin America in the past decade that marked a renewal of state activism in economy and poverty reduction. Using the concept of ‘new developmentalism’ described by Bresser-Pereira, this article offers a more nuanced approach to post-neoliberalism in Argentina. It argues that the post-neoliberal project or neo-developmentalism in Argentina does not mark a distinct departure from neoliberalism. Instead, it embodies a hybrid and complex process that maintains the core elements of economic liberalism. This article aims to contribute to the debates on post-neoliberalism and the New Left in Latin America.     

Towards Post-neoliberal Resource Politics? The International Political Economy (IPE) of Oil and Copper in Brazil and Chile

The contemporary commodity boom is unprecedented in two ways. On the one hand, it takes place against the backdrop of the failure of neoliberal policies to achieve stable economic growth in Latin America. On the other hand, Left-of-centre governments, which have now been in power for over a decade, are designing new strategies to manage the increase in export earnings accrued from sustained international demand for commodities. In particular, Brazil and Chile have undergone significant market opening reforms in their resource sectors, yet persistent state ownership and the dominant role of state enterprises in key extractive industries continue to characterise their growth models. This article explains this puzzle through the application of Mahoney and Thelen's (2010) historical institutionalist framework on incremental change. In so doing, it offers a process-oriented approach in exploring how resource wealth under certain economic and political conditions provides leverage for states to promote economic development. In sum, the article hopes to contribute to the literature on neoliberal and post-neoliberal political economies in Latin America.     

Models of Capitalism: Growth and Stagnation in the Modern Era

Recent years have seen increasingly aggressive expansion of extractive industry in the Andean-Amazonian region. Reminiscent of the film Avatar, this expansion drives conflicts over land, territory and political control of space. This expansion is occurring in both overtly neoliberal regimes and in self-consciously post-neoliberal ones. This essay documents the convergence among the different regimes' ways of governing extraction and socio-environmental conflicts. We draw on Executive level statements and policy positions as well as on statements by indigenous peoples' organisations. Among the reasons for this apparent convergence are: long-standing resource curse effects; the need to generate resources to finance social policy instruments that are integral to the governments' overall political strategies; power and information asymmetries among companies and governments; and international relations. The convergences among Bolivia, Ecuador and Peru regarding the governance of extraction and the conflicts that it catalyses suggests the need for great critical caution before using the terminology of post-neoliberalism.     

Post-neoliberal developmental regimes in Latin America: Argentina under Cristina Fernandez de Kirchner

This article seeks to analyse the concept of post-neoliberalism through state theory, grounded in an understanding of the state as a historical institution influenced by both domestic and international forces. This theoretical exercise is complemented with a discussion of contemporary Argentina under the Presidency of Cristina Fernandez de Kirchner, showing that focus on a ‘developmental regime tripod’ reveals underlying tensions in the post-neoliberal model as a result of a desire to ‘deepen that model’ combined with shifts in the nature of international political economy in the wake of the global financial crisis.     

The Economic Surplus as a Fund for Social Change and Postneoliberal Governance

The central problem in capitalism today is not one of scarce resources clashing against innate, insatiable wants. Rather, the modern problem of monopoly capitalism is one of abundance of production clashing against scarcity of consumers. Indeed, sustaining growth while fighting against excess capacity proves to be the biggest battle in business today, fought by the capitalist power structure with the tools of neoliberalism and globalization. The economic surplus, roughly sketched, represents that gap between productive resources and consumption, and thus represents the abundance that is possible given current technology. The argument set forth is that the economic surplus remains a powerful tool in describing economic relationships and social justice issues within the context of the Great Capitalist Restoration, but more importantly, that the economic surplus represents a tool for social change. The potential for socially just amelioration and change within post-neoliberal governance is explored with explicit reference to the qualitative and instrumental framework proposed by Ron Stanfield in his somewhat overlooked but incredibly important piece, “The Fund for Social Change” (1992).     

Post-capitalist Development in Latin America’s Left Turn: Beyond Peronism and the Magical State

The persistence of struggles by popular sectors in the context of the pink tide has generated ongoing debates about how to interpret the region’s left turn. For some, these movements are understood as forming part of a tense but ultimately productive relationship with left governments in the pursuit of post-neoliberal development. For others, it points to potentially irreconcilable political differences, and neoliberal continuities in pink tide governance. In this paper, I address these debates by presenting research on two social movements: Argentina’s recuperated enterprises and Venezuela’s popular economy. Using a Marxian-inspired, situated case study approach, I argue that these movements can be understood as ‘post-capitalist struggles’, that is, attempts to articulate new forms of democracy and cooperation that point beyond capitalism. As such, these movements push beyond the politics of Kirchnerismo and Chavismo that reproduce, albeit in new forms, the limitations to post-capitalist development associated with Peronism and the ‘magical state’. These movements therefore reveal both the region’s potential post-capitalist future, and the barriers that stand against it in the context of the region’s latest phase of development.     

How credible is the North Korean threat?

We perform event analysis on particular episodes of tension in the Korean peninsula between 2000 and 2008, and investigate the effect of the events on South Korean financial markets (stock markets, bond yield spreads and the exchange rate) given that South Korea would be the first affected by a military aggression from North Korea. Surprisingly, in nearly all cases, these events, which have often been dramatized in the world media, have no significant impact on either of these variables or only a very small one. We also find no significant impact of events on listed firms that would a priori be likely to suffer from increased tension between the two Koreas. Since financial markets often contain better predictions than expert opinions or surveys, these results strongly suggest that the North Korean threat is non‐credible.     

The risk of the sovereign debt default: the Eurozone crisis 2008–2013

We investigate the relationship of the market pricing of sovereign risk to default, through credit default swap (CDS) spreads for 16 Eurozone countries during 2008q1–2013q3. We take into account, through appropriate non-linear generalized method of moments (GMM) estimations the endogeneity problem. We focus on ‘fiscal space’ (DEBT or FISCAL), and the downgrade announcements (DOWN). We find DEBT (FISCAL) to have significant (insignificant) effects on the CDS concave function, as well as, DOWN in a linear one. It has also been confirmed significant pricing discrimination between South and West Euro Area Periphery (SWEAP) and the core Eurozone, highlighting asymmetries discovered either by the respective size of estimated DEBT coefficients or by the significant effects of DOWN that have only on CDS of SWEAP countries. The current account balance or the inflation rate, as well as, relevant interaction terms seem not to affect the spreads of the EMU. These findings, together with the estimated structural change on CDS pattern in early 2011, coinciding with significant either the DOWN in the pre-crisis period (2008–2010) or the DEBT in the post-crisis one (2011–2013) on the CDS, seem to be consistent with self-fulfilling crises literature and the inherent vulnerability of EMU, on other words, the ‘fragility hypothesis of the Eurozone’.     

Literature-related discovery (LRD): Lessons learned, and future research directions

Literature-related discovery (LRD) is the linking of two or more literature concepts that have heretofore not been linked (i.e., disjoint), in order to produce novel, interesting, plausible, and intelligible knowledge (i.e., potential discovery). The open discovery systems (ODS) component of LRD starts with a problem to be solved, and generates solutions to that problem through potential discovery. We have been using ODS LRD to identify potential treatments or preventative actions for challenging medical problems, among myriad other applications. The five immediately preceding papers in this Special Issue describe the application of ODS LRD to Raynaud's Phenomenon (RP), cataracts, Parkinson's Disease (PD), Multiple Sclerosis (MS), and Water Purification (WP). We describe the lessons learned from each application, and how the techniques can be improved further.Generation of much potential discovery using ODS LRD is possible when the conceptual roadblocks to discovery are removed. Some of these roadblocks include use of numerical filters that are unrelated to generating discovery, and excessive reliance on literatures directly related to the problem literature of interest. The issue of how to handle large amounts of potential discovery has not been addressed in the literature, since most ODS LRD researchers have tried to find a relatively few potential discovery items. We present a development strategy that capitalizes on the large amounts of potential discovery we have identified.     

Do Differences in Financial Development Explain the Global Pattern of Current Account Imbalances?

Building on the panel-regression approach of Chinn and Prasad (2003 ) and Gruber and Kamin (2007 ), we assess whether differences in financial development can explain the large developing-country surpluses or large US deficits. We find little evidence to support these hypotheses. We also assess whether differences in asset returns, an alternative measure of the attractiveness of financial assets, can explain the international pattern of capital flows. Lower bond yields have been generally associated with larger current account deficits in industrial countries. However, US bond yields have not been significantly lower than those in other industrial economies, suggesting that US financial assets have not been unusually attractive. We consider an alternative hypothesis that spending in the United States was uniquely responsive to lower costs of capital. However, we found this hypothesis also to be weak, as household saving rates have declined throughout the industrial economies.     

Literature-related discovery (LRD): Potential treatments for Raynaud's Phenomenon

Literature-related discovery (LRD) is the linking of two or more literature concepts that have heretofore not been linked (i.e., disjoint), in order to produce novel, interesting, plausible, and intelligible knowledge (i.e., potential discovery). The open discovery systems (ODS) component of LRD starts with a problem to be solved, and generates solutions to that problem through potential discovery. We have been using ODS LRD to identify potential treatments or preventative actions for challenging medical problems, among myriad other applications.Raynaud's Phenomenon (RP) is a condition in which small arteries, most commonly in fingers and toes, contract and cause the skin to turn pale or a patchy red to blue. We selected the subject of RP for analysis by LRD because of RP's global prevalence, and its apparent intractability to all treatments except for palliative remediation mainly through drugs or surgery. Our main goal was to identify non-drug non-surgical treatments that would 1) prevent the occurrence, or 2) reduce the progression rate, or 3) stop the progression, or 4) maybe even reverse the progression, of RP. Our secondary goal was to compare our ODS LRD approach to the RP problem with other investigators who have addressed the RP problem since Swanson's pioneering 1986 ODS LRD paper on potential RP treatments [D.R. Swanson, Fish oil, Raynauds syndrome, and undiscovered public knowledge, Perspectives in Biology and Medicine 30 (1) (1986) 7-18].We used Medline from 1965-1985 to identify potential discovery for RP. We differ from all the other authors who have addressed this problem in two major respects: we make no numerically-based filtering assumptions, and we generate substantial potential discovery (∼ 130 potential discoveries). Further, we believe our reported results are the tip of the iceberg. Much more potential discovery is possible with an adequately resourced study using the lessons learned from this demonstration study and the other demonstration studies that follow in this Special Issue.     

Literature-related discovery (LRD): Water purification

Literature-related discovery (LRD) is the linking of two or more literature concepts that have heretofore not been linked (i.e., disjoint), in order to produce novel, interesting, plausible, and intelligible knowledge (i.e., potential discovery). LRD has two main components that differ in their methodological approach to discovery: Literature-based discovery (LBD) produces potential discovery through analysis of the technical literature alone; Literature-assisted discovery (LAD) produces potential discovery through both analysis of the technical literature and use of selected authors of that literature. These authors generate potential discovery as proposers, workshop/panel participants, or in other active roles.The open discovery systems (ODS) component of LRD starts with a problem to be solved, and generates solutions to that problem through potential discovery. We have been using ODS LRD to identify potential treatments or preventative actions for challenging medical problems, among myriad other applications. The previous four papers in this Special Issue describe the application of ODS LRD (specifically, the ODS LBD variant) to Raynaud's Phenomenon (RP), cataracts, Parkinson's Disease (PD), and Multiple Sclerosis (MS).One goal of the present study was to determine whether LRD could be successfully applied (for the first time) to a challenging non-medical technical problem to generate potential discovery. The second goal was to explore the use of both LRD variants (LBD and LAD) to a non-medical technical problem. We selected the problem of water purification (WP) because of universal applicability and sponsor interest.We used LRD to identify purification concepts, technology components and systems that could lead to improved water purification techniques. We accessed many disparate disciplines to identify purification concepts from literatures not normally associated with water purification. We used two LBD approaches, Cluster Filtering and Latent Semantic Indexing (LSI), to search for potential discovery. We generated voluminous amounts of potential discovery, and believe we have only scratched the surface of what is possible. We also ran a short experiment using LAD to identify experts associated with potential discovery concepts, and use their expertise to generate potential discovery for water purification.     

Trade Liberalisation and the Trade‐Off Between Growth and the Balance of Payments in Latin America

The broad purpose of trade liberalisation is to raise the rate of growth of countries on a sustainable basis, consistent with the achievement of other macroeconomic objectives. In this article we consider whether trade liberalisation in 17 countries of Latin America has improved the trade‐off between gross domestic product (GDP) growth and the trade balance, allowing the countries to grow faster without sacrificing foreign exchange. We find that in the aftermath of liberalisation, the majority of countries did grow faster, but at the expense of a deteriorating trade balance. Testing formally for the impact of trade liberalisation in a full model of trade balance determination, we find that only in Chile and Venezuela has the trade‐off unequivocally improved. In other countries there has been a significant deterioration or no change. Nine out of the 17 countries have grown faster post‐liberalisation than pre‐liberalisation but, except for Chile and Venezuela, at the expense of a wider trade or current account deficit.     

GDP growth in Russia: different capital stock series and the terms of trade

There are different academic assessments of the principal forces behind Russia’s GDP growth. Studies that reconstruct capital stocks using gross fixed capital formation and the perpetual inventory method find that total factor productivity growth has been paramount to GDP growth. On the other hand, capital services datasets that have recently been made available find that capital developments have been instrumental in driving economic growth. We reconstruct a capital stock series for Russia for 1995–2013 and compare the results to two capital services time series using the Solow growth model. We also take into account terms of trade developments that have lent strong support to Russia’s economy. The terms of trade is shown to have been an important factor behind the development of gross fixed capital formation and thus GDP growth.     

Literature-Related Discovery (LRD): Potential treatments for Parkinson's Disease

Literature-Related Discovery (LRD) is the linking of two or more literature concepts that have heretofore not been linked (i.e., disjoint), in order to produce novel, interesting, plausible, and intelligible knowledge (i.e., potential discovery). The open discovery systems (ODS) component of LRD starts with a problem to be solved, and generates solutions to that problem through potential discovery. We have been using ODS LRD to identify potential treatments or preventative actions for challenging medical problems, among myriad other applications. The previous two papers in this Special Issue describe the application of ODS LRD to Raynaud's Phenomenon (RP) and to cataracts.Parkinson's Disease (PD) is a progressive neurodegenerative disorder, affecting approximately 1% of individuals older than 60 years, and is characterized by resting tremor, rigidity, bradykinesia, and postural instability. We selected the subject of PD because of its global prevalence, and its apparent intractability to all treatments except for palliative remediation mainly through drugs or surgery.Our first goal was to identify non-drug non-surgical treatments that would 1) prevent the occurrence, or 2) reduce the progression rate, or 3) stop the progression, or 4) maybe even reverse the progression, of PD. Our second goal was to demonstrate that we could again solve an ODS problem (using LRD) with no prior knowledge of any results or prior work (unlike the case of the RP problem). As in the ‘cataract’ example, we used the MeSH taxonomy of MEDLINE to restrict potential discoveries to selected semantic classes, and to identify potential discoveries efficiently. Our third goal was to generate large amounts of potential discovery in more than an order of magnitude less time than required for the RP study. The discovery generation methodology has been developed to the point where ODS LRD problems can be solved with no results or knowledge of any prior work.     

Credit unions during the crisis: did they provide liquidity?

We use the consumer finance monthly national survey to demonstrate that credit unions (CUs) in the United States did little to help consumers obtain a home equity line of credit (HELOC) during the recent financial crisis. Our results hold after including a two-stage regression structure using the availability of CUs as the identifying instrument, as well as employing a Heckman correction procedure to adjust for sample selection bias. We find that during the financial crisis, CUs were no more likely than other depositary institutions to extend HELOCs either in areas experiencing housing price declines or to lower income households. Our results provide an empirical counterpoint to those who have lauded CUs for providing liquidity during times of crisis or for serving consumers who would otherwise be challenged to obtain funds.     

Supply and demand biases in linear interindustry models

We explore the sectoral and aggregate implications of some endogeneization rules (i.e. on value-added and final demand) which have been common in the extended demand-driven Leontief model and have been recently proposed in the supply-driven Ghosh model. Extended linear models are refinements that aim at endowing the linear models with additional general equilibrium feedbacks. We detect that these rules may give rise in these models to some allegedly pathological and biased behavior. We find that in these models sectoral or aggregate output may not follow the logical and economically expected direct relationship with some underlying endogenous variables — namely, output and value-added in the supply-driven model and output and consumption in the demand-driven model. Because of their shared mathematical structure, whatever is or seems to be pathological in the Ghosh model also has a symmetric counterpart in the Leontief model. These would not be good news for the inner consistency of these linear models and raise doubts regarding the validity of their empirical applications. To avoid such possible inconsistencies, we propose new and simple endogeneization rules that have a sound economic interpretation.     

Heteroscedasticity of deviations in market bubble moments – how the goods and bads lead to the ugly

We conjecture that market bubbles may be the results of the interplay of Goods and Bads (toxic products) which develop through three interlocking moments – herding, swarming and stampeding, with deviations marked by heteroscedasticity. We use our stylized model of financial predation, the Consolidated Model of Financial Predation, and data we have accumulated through in-the-field eight-year research and the study of 30 years of U.S. market history in order to explore the foundations of market crises. We find that blind trust (or the positivity bias) and of the fear to miss out on an opportunity to enter/exit a market impacts the investors’ decisions to invest or retract. We show how markets are driven towards a make-or-break predatory dynamic that creates winners and losers due in part to weak regulations and identify a constant k that permeates market behaviours.     

Literature-related discovery (LRD): Potential treatments for cataracts

Literature-related discovery (LRD) is the linking of two or more literature concepts that have heretofore not been linked (i.e., disjoint), in order to produce novel, interesting, plausible, and intelligible knowledge (i.e., potential discovery). The open discovery systems (ODS) component of LRD starts with a problem to be solved, and generates solutions to that problem through potential discovery. We have been using ODS LRD to identify potential treatments or preventative actions for challenging medical problems, among myriad other applications.This paper describes the second medical problem we addressed (cataract) using ODS LRD; the first problem addressed was Raynaud's Phenomenon (RP), and was described in the third paper of this Special Issue. Cataract was selected because it is ubiquitous globally, appears intractable to all forms of treatment other than surgical removal of cataracts, and is a major cause of blindness in many developing countries.The ODS LRD study had three objectives: a) identify non-drug non-surgical treatments that would 1) help prevent cataracts, or 2) reduce the progression rate of cataracts, or 3) stop the progression of cataracts, or 4) maybe even reverse the progression of cataracts; b) demonstrate that we could solve an ODS LRD problem with no prior knowledge of any results or prior work (unlike the case with the RP problem); c) determine whether large time savings in the discovery process were possible relative to the time required for conducting the RP study. To that end, we used the MeSH taxonomy of MEDLINE to restrict potential discoveries to selected semantic classes, as a substitute for the manually-intensive process used in the RP study to restrict potential discoveries to selected semantic classes. We also used additional semantic filtering to identify potential discovery within the selected semantic classes.All these goals were achieved. As will be shown, we generated large amounts of potential discovery in more than an order of magnitude less time than required for the RP study. We identified many non-drug non-surgical treatments that may be able to reduce or even stop the progression rate of cataracts. Time, and much testing, will determine whether this is possible. Finally, the methodology has been developed to the point where ODS LRD problems can be solved with no results or knowledge of any prior work.     

Elasticity of substitution and technical efficiency: evidence from the US electricity generation

ABSTRACT

The implications of national or regional energy policies for technical efficiency and environmental outcomes in electricity generation depend on fossil fuel input substitution. This study uses state level data to examine fossil fuel (coal and natural gas) substitution in electricity generation under increased availability of natural gas in the United States. We observe that changes in elasticities of substitution from pre-2009 to post-2009 differ across states suggesting that the effects of increased availability of inexpensive natural gas on electricity generation have been spatially heterogeneous. We rely on the observed heterogeneity to assess the effects of fossil fuel input substitution on technical efficiency and CO₂ emissions. The results reveal that state level elasticity of substitution between natural gas and coal has a positive effect on technical efficiency and a negative effect on CO₂ emissions. Therefore, future policy design and analyses should reflect the implications for regional elasticities of fossil fuel substitution and associated environmental outcomes.