Cuba's Free-Market Experiment: Los Mercados Libres Campesinos, 1980-1986

Abstract

In 1970, as part of a comprehensive program of institutionalization, new economic policies were introduced in Cuba emphasizing more extensive use of material incentives, wage differentials, and piece rates to stimulate productivity. Those policies raised the incomes of Cuban workers and created new demands for a better diet and more consumer goods. Yet problems in the state-run domestic food sector made it difficult for Cubans to secure the higher standard of living promised by their increased salaries and wages. In May 1980, the mercados libres campesinos (MLCs) were introduced as part of a strategy aimed at harnessing the productive capacities of the peasant sector to help satisfy the resulting pent-up demand. The MLCs provided sites where agricultural producers (free peasants, cooperativists, workers on state enterprises, and owners of small plots and gardens) could sell their surplus production directly to consumers. The law governing the MLCs contained several significant restrictions, but the markets were free in regard to prices and quantities sold.