The Political Economy of Fiscal Reform: the Case of Colombia,1986 - 2006

"During the last two decades, the Colombian Central Government (henceforth CG) expenditures increased substantially. From an average of 9.8% of GDP between 1981 and 1991, CG expenditures increased to 21.5% in 2007, with an average of 17.6% for the period 1992-2007. Such trends were the consequence of a generalized recognition, endorsed by consensus in the 1991 Constitutional Assembly, that Colombia had an excessively weak and small State to deal effectively with security, globalization and social challenges. Thus, Colombia was the only Latin American country in which the pro-market economic policies of the early nineties (i.e. trade and capital account opening, privatizations, etc.) were not accompanied by an objective of reducing the State , but on the contrary, to strengthen it."