Social Conflict and Inflation in Mexico

Abstract

Social conflict takes many forms. Violent confrontations, strikes, civil disobedience, and public demonstrations are some of the more obvious ways in which people can display their discomfort with existing social conditions. In most societies, government and established social groups will go to great lengths to prevent this discontent from overflowing the normal channels of social conciliation. Mexican society has been particularly successful among Latin American republics in keeping social conflict within bounds. Although social conflict is permanent feature of life in Mexico, as in most societies, there have only been few occasions during the past half century when events have obliged and permitted social groups to resort to unusual tactics to attempt to redress grievous injustices. For the most part, the prevailing model of economic development has apparently been able to fulfill expectations sufficiently well to avoid serious outbreaks of violence which might threaten the existence of the social structure. It seems remarkable that there have been so few occasions on which conflict has been transformed into near chaos; by examining those occasions it may be possible to gain better understanding of the underlying processes of social negotiation that promote stability. We argue that inflation is particularly important and revealing manifestation of social conflict. Inflation is actually part of the process of social conflict: it is its monetary expression. When examined as an expression of social processes instead of as simple monetary manifestation of economic problems, the study of inflation may give us insight into the way in which government, itself an expression of political balance of social forces, can develop institutional arrangements to resolve potential conflicts and defuse explosive situations. We can also derive some lessons about the kind of social process, linked to inflation, that cannot be readily controlled, thereby paving the way for authoritarianism. For most people, including economists specializing in the subject, inflation is synonymous with rises in the cost of living: a continuous increase in *The authors are members of the economics faculties of the Universidad Aut6noma Metropolitana and the Universidad Nacional Aut6noma de Mexico respectively. This article is adapted