External security threats and “state autonomy” from societal pressures are generally seen as necessary conditions for successful programs of state-led economic transformation. However, during the 20th century, several states successfully pursued economic upgrading under conditions of intense popular mobilization and limited external threats.
This paper argues that the organizational strategies of political parties are crucial to explain the success and failure of those cases. In some countries, clientelistic parties mobilized supporters through the promise of privileged access to state benefits. As a result, popular demands turned political stability and economic upgrading into competing priorities for the allocation of public resources, ultimately contributing to the collapse of state-led economic transformation under the weight of social conflict and crony capitalism. In other cases, programmatic parties coordinated collective action by offering their supporters access to deliberative systems in which they could engage in various forms of communication to acquire information, clarify conflicts, identify shared interests, and—crucially—rearticulate those interests in terms of general principles that should govern the use of state resources. Programmatic parties thus changed the normative orientation of societal demands, and played a crucial role in curbing social conflicts and limiting economic rent-seeking.
The empirical analysis is based on structured cross-national comparisons and within-country process tracing of Argentina, Mexico, France and Sweden, from 1940 to 1980. The analysis focuses on the behavior of policy-makers, economic elites and the popular sectors as they negotiated the distribution of the short-term costs and benefits of economic policies. The goal is to observe under what conditions societal actors cooperated with policies that imposed costs on them for the sake of the long-term goals of economic transformation.
This paper is part of a broader project that examines how the institutionalization of robust deliberative systems contributed to processes of democratic consolidation and state formation.
