The World Bank and Policy Reform in Mexico and Argentina

Abstract

This article examines the World Bank's role in the market policy reform experiences of Mexico and Argentina. It argues that while reform was driven by domestic elites, the bank played an important role, providing technical advice and financial support and helping to spread market reform ideas. The nature of the bank's involvement, however, differed substantially in the two countries because of their distinct political arrangements, histories, and geopolitical positions in regard to the United States. In the recent era of second-generation reforms, the World Bank's involvement in compensatory policy development has become more focused, although still more intense in Argentina than in Mexico. This involvement has important implications for the quality of democracy, insofar as the 1990s market reforms were formulated by insulated international policy networks unaccountable to the public. Recently, the bank has declared its commitment to involve civil society in its lending policies, a move that may have important implications for democratic development.