Market-Based Repoliticization and Democracy in Latin America

Recent research has found that economic liberalization undermines democracy in the short-term, while reinforcing it over the long run, producing a J-curve relationship between economic liberalization and democracy. The widespread belief that economic liberalization demobilizes societal actors is seen as a key intermediate variable contributing to the positive, long-term effect of economic liberalization on democracy. However, numerous studies have challenged the demobilization perspective, forcing us to revisit the relationship between mobilization and democracy. We posit a reciprocal relationship between economic liberalization and mobilization based on the redistributive consequences of market liberalization. We argue that mobilizations can have both positive and negative effects on democracy depending upon the level of economic liberalization. This double-sided effect, in turn, provides an alternative interpretation of Latin America's J-curve, whereby conflicts between elite and mass-based actors help democracy advance once it is established. This perspective is consistent with prior literature on the effect of mobilization during times of transition, and helps explain the endurance of democracy despite the presence of mass civic revolts as a consequence of the mobilizing effects of market reforms. Using cross-national time-series data from 17 Latin American countries between 1970 and 2004, our results show that mobilization is a key intermediate variable that binds economic liberalization with democracy in the market era.