This is an important book. Although the political economy of neoliberal economic reform in Latin America and Southern Europe, and specifically the transition from import substitution industrialization (ISI) to new market-oriented arrangements, is well-tread terrain, Sebastián Etchemendy's study sheds new light on the subject. Focusing on the cases of Spain, Argentina, and Chile, with additional comparative insights from Brazil, Peru, Mexico, and Portugal, Models of Economic Liberalization delineates different reform trajectories in each of the three main cases, drawing on the conditions antecedent to reform in the 1980s and 1990s and the subsequent legacies of neoliberal adjustment. It argues that neoliberal economic reform is essentially a political construction.

Basically, Etchemendy draws for us three pathways of reform, emphasizing a different mode of imposition and accommodation among key actors in each: state imposed, concertation/corporatist, and market driven. He demonstrates that in any reform process, there are winners and losers. What the book is interested in, therefore, is who wins and loses in neoliberal reform, and how they are compensated by the state. As he puts it, the book is about the “politics of compensation” and various kinds of “compensatory deals.” The explanatory variables in the study are regime type (democracy and authoritarianism) and the strength and position of ISI actors (industry and labor) prior to the reform period.

The logic is simple yet powerful. In the case of democratic Spain, weak ISI actors in industry and labor allowed the state to unilaterally impose neoliberal economic reform, though the democratic imperatives of gaining political support compelled the state there to provide compensation in the form of direct subsidies. As Etchemendy explains, once the subsidy life-line ran out, those firms were wiped out. In contrast, the Argentinean state confronted strong ISI actors, and in the context of democracy, chose to engage in concertation-style negotiations with business and labor, resulting in a compensatory deal that featured some protected market share in the new economic order. Authoritarian Chile under the Pinochet regime, the author explains, liberalized its economy by unleashing market discipline on previous ISI actors, comprising industry and workers in the formal labor market, and in turn by selectively compensating the very poor and informal workers through targeted social spending. Authoritarian means of coercion meant that the Chilean state did not have to attend to the same sort of political pressures faced by the democratic governments in Spain and Argentina.

The book is theoretically elegant and empirically rich. The empirical evidence is convincing. Etchemendy is to be commended for assembling different kinds of evidence from a broad variety of sources. Though at times a bit clunky and repetitive, the chapters are layered in a way that slowly builds the author's argument over the course of the book. Just as the reader, for instance, begins to wonder in Chapter 4 how generalizable the argument is with respect to a broader range of industrial sectors, Chapter 5 follows with an excellent explication of how “negative” cases in fact support the book's principal theses and lines of argumentation. Or when one begins to wonder if and how the statist, concertation, and market-driven pathways of reform fit with other cases, he provides a detailed comparative look at these models in Brazil, Peru, Mexico, and Portugal in Chapter 9. Although the book is possibly a bit too long and could have laid out its arguments and evidence more concisely, the presentation of the study is nonetheless very well constructed. There is much to laud and little to criticize.

I have three, more critical, reactions to this fantastic book. First, it could have expanded its comparative reach by analytically alluding to the processes of economic reform in Asia and Central and Eastern Europe. I point this out, admittedly, in part because my area of research is Asia but also because, quite frankly, the powerful yet simplistic theoretical intervention made by Etchemendy invites consideration of other national contexts, and I suspect it would lead to further theoretical refinements in scholarship about other parts of the world. To be sure, Models of Economic Liberalization is not just a story of the political economy of neoliberal reform in the Ibero-American world but, rather, one that illuminates a more global story.

Second, it is not entirely clear to me why authoritarian Chile needed to provide compensation for excluded social classes and workers if the logic of authoritarian rule, as distinct from that of democracy, did not feature the imperatives of winning popular support. As Etchemendy states: “The major attack on the ISI institutions and actors launched by the Chilean dictatorship would have been unthinkable under a democratic government” (p. 232). He provides some clarity, however, when he points out that despite the absence of democratic institutions, the Chilean dictatorship under Augusto Pinochet nonetheless needed some bases of political support and legitimacy, or as he puts it, the “necessity to cultivate mass support for the regime.” It is important to stress that this “turn to politics” (p. 235) emerged during the late 1970s and early 1980s, precisely when the authoritarian regime looked to become more institutionalized as a political party and a “formal political organization that would eventually be able to compete in democratic politics” (p. 238). On the one hand, authoritarianism enabled the Chilean state to impose market discipline with little regard for making a compensatory deal with ISI actors; on the other hand, it was precisely the possibility of eventual democratic competition, and not authoritarianism, that compelled the Pinochet dictatorship to pay off informal workers and the poor. In this respect, regime type surely mattered, as specified in the author's theory, but the fluid politics of change and eventual political transition mattered as well in shaping the state's efforts to compensate losers.

Finally, in the concluding chapter, Etchemendy devotes two pages to the defense of his path-dependency and structuralist approach to explaining neoliberal reform in Ibero-America. In so doing, he seems to want to resist the notion that his argument is structurally overdetermined, that “it is plausible to argue” that alternative paths could have been taken by each of the countries studied (p. 304). While he weakly gestures to the plausibility of contingency, choice, and alternative paths—as unlikely as he knows them to be—Etchemendy should firmly stick to his argument and be unapologetic about a set of causal claims that are not overdetermined at all but, rather, overwhelmingly convincing empirically because of the structural political economic constraints he so clearly and richly demonstrates.