Beyond the Washington Consensus: the quest for an alternative development paradigm for Latin America: Ignacio Perrotini- Hernández, Juan Alberto Vázquez-Muñoz and Blanca L. Avendaño-Vargas
Structural economic reforms varied in intensity across sectors and countries. All countries in Latin America significantly liberalized international trade, external capital flows and the domestic financial sector. Policy decisions in these areas included reducing tariffs and their dispersion; dismantling nontariff barriers; eliminating most restrictions on foreign direct investment; phasing out many or most foreign exchange regulations; granting greater or total autonomy to central banks; dismantling regulations regarding interest rates and credit allocation; reducing reserve requirements on domestic deposits; and privatizing several state banks. In the fiscal area, reforms strengthened the value added tax, reduced income tax rates and strengthened tax administration, though with only a limited effect on tax evasion. Social security systems were overhauled in several countries to allow for the participation of private agents and a more clear balance between benefits and (employers’ and workers’) contributions.