Market Reforms, Technocrats, and Institutional Innovation

Abstract

Successful market reform projects require significant revision of government agencies, institutional arrangements, and policy-making procedures, in part, to provide reformers autonomy from countervailing pressures. This paper examines how such innovations facilitated reforms in Mexico and Argentina. It finds executive leadership helped facilitate institutional change, but that technocrat policymakers played more crucial roles than previously documented. Through rule-changing, instrument-creating, and strategizing behaviors, they helped engineer their own autonomy and gained control of the policy agenda by changing the organization of decision making, and the position they occupied in the bureaucracy. These findings hold across distinct policy arenas and political systems.