Decentralization and democracy in Latin America: Reshaping the development paradigm

Abstract

Regional development and decentralization has been at the core of political and economic development in large countries of Latin America (Argentina, Brazil and Mexico). All of them were born as Federal states, and assumed distribution of power among the three levels of government, but di facto central government held the decision making process until late twentieth century, when a governance crisis emerged as a result of the debt crisis, forcing governments to rebuilt their social contracts: Argentina reformed its Constitution in 1994, Brazil enacted a new Constitution in 1988 and reformed it in 1996; and Mexico reformed the Constitution in 1983 and 1999. Reforms have strengthened municipal finance and have delivered a larger political autonomy to local governments.