This book applies a bounded rationality perspective to examine the causal mechanisms of cross-national policy diffusion in pension and health reforms in Latin America in the last two decades. The author argues that an understanding of the way in which policy-makers learn from foreign policy is an important factor explaining the speed and direction of international policy diffusion. Based on extensive interviews with policy-makers, the author confirms the importance of cognitive shortcuts to identify and assess policy options. A focus on these cognitive shortcuts, it is argued, illuminates the causal mechanisms of policy diffusion in the region. The book provides a detailed analysis of the bounded rationality perspective (chapters one and two), which is then applied to pension reform (chapters three and four) and health reforms (chapters five and six), before discussing the implications of the findings for our understanding of policy diffusion in the era of globalisation (chapter seven). This is an interesting and illuminating book, which will no doubt make an important contribution to our understanding of social sector reforms in the region and elsewhere. Some of its findings challenge widely held views, for example regarding the extent of the influence of the World Bank on pension reform in the region. The operationalisation of bounded rationality perspectives in a cross-national policy reform context will make an important addition to the toolbox available to researchers.

The significance of social sector reforms in Latin America hardly needs underlining for the readers of this journal. The wave of pension reform which followed Chile's 1981 replacement of pay-as-you-go occupational pension schemes with individual retirement accounts managed by private providers, appears to many to encapsulate the spread of neoliberalism in the region. Health reforms lack a ‘Chilean model’ but have received no less attention from researchers. It is as if the arena of public debate on models of development has shifted from the issues of trade, industrial and macroeconomic policies, which dominated in the 1950s and 1960s, to social policy.

The perspective on international policy diffusion applied in the book emerges from the assessment of a set of nested questions around rationality in politics. Are policy options chosen on the basis of external pressures or domestic initiative? The author's response is that in the context of pension and health reforms in the region, the view that international financial institutions, and especially the World Bank, had decisive influence must be rejected. He is able to demonstrate that even in highly debt dependent countries, such as Bolivia, the pension reforms adopted reflected the domestic concerns of political leaders, sometimes at loggerheads with the external advice given. The World Bank had a strong influence on the availability of policy options through the financing of technical assistance, but domestic factors had primacy. We now come to the second question. If domestic concerns had primacy, were policy-makers driven by the quest for legitimacy and support, or by the pursuit of their own interests? The author concludes that policy makers were largely driven by their own interests, not by legitimacy concerns. The third question concerns the way in which policy-makers went about the pursuit of their interests. Was it through the kind of rational assessment of all available options, as proposed by rational choice theorists, or through a more limited bounded rationality in which options are heuristically limited? The author argues that policy-makers in Latin America more accurately followed the latter course.

Weyland makes a strong case for using the prism of cognitive psychology to identify the heuristics employed by policy-makers in learning from foreign policy experiences. In particular, he emphasises that the availability of policy alternatives is limited by the disproportional attention paid to striking examples, such as the Chilean model of pension reform; that policy makers are prone to over-estimate small sample information, such as the apparent early growth effects of the Chilean pension reform; and that earlier impressions will colour later judgements. The fact that policy-makers employ these cognitive heuristics to organise the information available to them explains, the book argues, the nature of cross-national policy diffusion, for example the geographical clustering of reforms reflecting availability. The book provides a detailed discussion on these cognitive rules supported by evidence emerging from interviews of policy-makers and an extensive review of the literature. The list of interviews and references runs to 42 pages.

The main message of the book is that the spread of social sector reforms in the region cannot be adequately explained without paying attention to cognitive factors, especially as, in learning from foreign policy models, policy-makers pursue their objectives using cognitive shortcuts to assess policy options. As the author notes, reliance on cognitive shortcuts exacts a price, the possibility of questionable decisions from busy, hazy, or lazy politicians. The main contribution of this book is in opening a window onto the significance of epistemic factors in cross-national social policy diffusion in Latin America, but the main findings will also apply elsewhere. For this reason alone, this book is a welcome addition to the growing literature on the topic.