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The paradox of protest in LA

Patricia Justino
Phd en Economía (Universidad de Londres)

Bruno Martorano
PhD en Economía del Desarrollo (Universidad de Florencia)

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Vie, 27-05-2016
There is a large and growing consensus that global protests during the recent economic crisis were driven by rising inequalities. But available data show a negative correlation between inequality and protests in Latin America. Why does this paradox exist? Our study reveals that individual participation in protests was largely motivated not by absolute levels of inequality but by people’s perceptions of inequality.

There is a large and growing consensus that global protests during the recent economic crisis were driven by rising inequalities. But while increasing inequalities have been well documented in many developed countries, inequality in Latin America was reduced substantially in the last decade. Despite reductions in inequality, protests and civil instability have soared in many parts of the region. In Brazil, for example, large protests erupted during the Confederations Cup and the World Cup tournament in 2013, involving more than 1.4 million people. Chile experienced a wave of persistent student protests in 2011. Protests against the kirchnerismo were held in Buenos Aires in 2011. As a result, available data show a negative correlation between inequality and protests in Latin America casting doubts about the accepted positive links between inequality and protests (Figure 1).

Figure 1. Gini coefficient and average frequency of protest participation in 18 LAC countries in 2010, 2012 and 2014

 patricia justino

Source: Authors’ calculations based on SEDLAC and LAPOP datasets.

Why does this paradox exist? Our study reveals that individual participation in protests was largely motivated not by absolute levels of inequality but by people’s perceptions of inequality. And people’s perceptions did not match reductions in the Gini coefficient, especially because economic growth started to slow down across Latin America in recent years. The results of the paper also show that government policy has an important role in affecting perceptions of inequality and ensuring social and political stability.

Mismatch between social gains and perceived social change 

The hypothesis that inequality drives protests implicitly assumes that all citizens have access to the same set of information and have the ability to evaluate absolute levels of inequality at any given time. However, people have different perceptions about inequality. Their judgments and reactions are therefore likely to be based on own perceptions that may or may not match absolute levels of inequality. 

There are reasons to believe that people’s perceptions of inequality in Latin America do not match absolute reductions in levels of inequality. In a way, following the rapid economic growth experienced over the last decade, Latin American countries have become victims of their own success. As economic growth increased, people’s aspirations and expectation also rose. However, the expected social change people were hoping for has not happened at a pace that would match these rising aspirations, especially for the middle classes. Notably, the 2008 financial crisis and the worsening economic conditions provoked social discontent and frustration. People across Latin America have also remained dissatisfied with their governments, and with the quality of institutions and public services.

Voting or protesting? 

Individuals may attempt to change policy-making processes using conventional democratic channels such as voting in elections, resorting to increased participation in political parties, write petitions to their political representatives and so forth. However, unfulfilled expectations may also lead to lower trust in formal institutions, particularly when people blame the government for fuelling (perceived) inequalities, or for failing to redistribute resources adequately and provide public goods and services.  This was the case in Latin America, where social discontent and anger increase the propensity of individuals and groups to engage in protests.

It was also not a surprise to find that individual participants in protests in Latin America were well integrated within society, rather than at the its margins – individuals that were employed, students and educated, with greater interest in politics and a left-wing political orientation were more likely to participate in protests. Social networks might have played also a key role in facilitating mobilization by helping citizen to coordinate, cooperate and take to the streets. Indeed, anger and grievance are necessary but not sufficient conditions to motivate individual participation in protests. In the time of facebook and twitter, participants in recent protests were also technology-savvy young people, who made large use of social media. 

Does government policy matter? 

Existing studies suggest that fiscal policy could be used both to gain support and legitimation among some population groups and to reduce inequality. Government social welfare spending, in particular, may potentially lower societal grievances and reduce protests in two ways. First, it might affect living conditions, thereby reducing inequality and social discontent. Second, it may influence attitudes and voting choices by increasing support for government institutions – a crucial factor in processes of democratic consolidation. However, such fiscal policies have economic as well as political costs. In order to finance social spending, governments have to increase taxes. Middle classes may accept to pay more taxes if spending adequately represents their preferences in terms of production and provision of public goods. Suspicions that government may waste public resources will, on the other hand, provoke social discontent and lead to further unrest. 

The recent choices of governments across Latin America to focus redistribution mainly on the poor have generated large gains in terms of poverty and inequality reduction. However, these choices may also have had unintended consequences in terms of social and political stability since the middle-classes may have felt excluded by this process. In particular, the low quality of public services and high tax burdens have slowly but continuously eroded the support toward the same political institutions which benefitted from a large consensus in the mid-2000s. 

Overall, there is large scope for better government performance in terms of improving the quality of public services, as well as the functioning of government institutions, including the reduction of corruption. This is necessary in order to revert the current trend in perceptions and to regain social cohesion, especially in countries such as Brazil in which the economic and political stability are waning. 

 

Click here to read the full paper.

 

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