The State and the Private Sector in Latin America: Reflections on the Past, the Present and the Future
Author(s)
Edwards, Jack K.; Baer, Werner
Abstract
The respective roles of the state, the private sector and foreign investors in Latin America have gone through an almost 360-degree change since the beginning of the 20th century. In the period before the Import Substitution Industrialization (ISI) movement, the exportation of primary goods was undertaken by private enterprises and foreigners. From the 1930s to the 1960s, however, the state began to gain control over most public utilities and the exploitation of natural resources. Nevertheless, since the 1973 oil crisis, the state has been forced to relinquish this control due to the financial crises that had befallen these firms due to mounting debts and inflation. Thus, privatization, deregulation and foreign investments are the reigning trends of the 1990s, with the state moving into other roles as the provider of social infrastructure, the regulator of natural monopolies and the administrator of an equitable tax and income distribution system.
