Contentious collective action and social spending in Latin America, 1970-2008

The last decade has been marked by an increasing interest in the political economy of social policy outside OECD countries. Most of this body of research builds on theories of the welfare state in advanced democracies and has focused its theoretical and empirical attention on the determinants of education, health and social security spending. Among the driving forces of social spending in the developing world, regime type and globalization have been the common subject of much empirical work. So far, this literature has been largely muted with regards to collective action efforts aimed at challenging national policies. Though prior research has shown that economic liberalization reforms in developing countries led to higher levels of protest, the effects of these collective action efforts remain unknown. This paper focuses on the effect of different forms of domestic dissent on social spending in 18 Latin American countries from 1970 to 2008. I argue that citizens power to influence social spending critically depends on their organizational capacity, their learning from past experience with collective action, and on the costs they impose to political leaders when ignoring their demands. The results show that protest has differentiated effects on social spending with labor-related protest having a strong positive effect on social policy, particularly on social security spending. Results also confirm previous research that has found a positive effect of democracy on human capital spending. Overall, this paper contributes to the growing literature on the determinants of social policy in developing countries.