Governance Crisis and the Andean Region:. A Political Economy Analysis. Andres Solimano. Governance and development outcomes. Analytical framework. Governance and development outcomes. Analytical framework for Governance 2.1 Basic Concepts. Hierarchy of institutions. Formal rules.
2.1 Basic Concepts.
2.2 Three main variables
a) Nature and stability of the political regime and the constitution.
b) Quality of institutions.
c) Patterns of social cooperation/conflict related to inequality and ethnic diversity.
(economic growth, macro stability,
Poverty, social equity)
(institutions are created to reduced transaction costs).
(Institutions play a redistributive role and support power structures).
For the Andean Countries (Bolivia, Colombia, Ecuador, Peru and Venezuela)
Bolivia (16 crisis), with 11 taking place between 1969-82.
Growth Competitiveness Report, 75 countries including developed, developing countries and transition economies.
Growth Potential = F [technology index, quality of public institutions index, macroeconomic environment index].
Index of Quality of Public Institutions:
The annual growth record of the Andean country in the 1950-2000 period was, on average, 1.2 percent lower than the (average) rest for Latin America. This is correlated with the governance problems documented in the paper