1. Success and Failure in the
Southern Cone
Comparing Democratization in Chile and Bolivia
Will Freeman
4/1/2016
Why is it that Chile has become the success of Latin America, while its neighbor has not done so well?
The answer to this question lies within the process of democratization. I am going to explore the detailed
answer to this question by comparing the nature of democracy in the two states. In particular, I will look
at the nature of transition, economic growth, and the national identities of the two states. According to
Huntington, these are foundational issues that help to determine the success of the democratization
process in a state. However,because many democracies of the third wave are products of colonialism they
are faced with a host of additional ethnic issues that must also be resolved. Huntington found that
institutionalization helped to prevent the rise of ethnic divides in these fledging democratic hopefuls. I
will closely examine issues of divide that lead to cronyism and its ethnically centered variant that I call
ethno-cronyism. By the end of this paper I hope to have found an explanation for why Bolivia has not
been able to successfully democratize given that its developmental history seems to be quite similar to
Chile’s.

2. Freeman 1
1 2
When talking about the process of democratization, scholars such as Samuel Huntington
observed three periods where there were big movements from non-democracy to democracy. The
first movement happened around the time of the American Revolution, and the second was after
the fall of fascism in 1945. He characterizes these as waves of democracy, hence the title of his
landmark book The Third Wave. This third wave of democratization, which began in the 1970s
with the fall of dictators in Southern Europe, will be the focus of my research. The third wave
affected much of the world and a lot of the newly decolonized states throughout Africa and
South America. In particular, I am going to closely examine the democratization processes in
Chile and Bolivia. These two countries have a history that is deeply intertwined but at a glance
1 "Map of South America." Map of South America. Accessed April 28, 2016.
http://www.wineandvinesearch.com/south_america.php.
2 "Southern Cone - Political Map." Mind Map Software, Drawing Tools. Accessed April 28, 2016.
http://www.conceptdraw.com/examples/southern-cone-map.

3. Freeman 2
appear to have taken different routes in their pathways to development. Both have had a long
history of authoritarian leadership mixed with hybrid regime types.3 However, during the third
wave, Chile has managed to secure its place as a successful democracy with one of the largest
economies in Latin America. While Bolivia, on the other hand, has not enjoyed such successes.
In this paper, I will advance a multifaceted argument that demonstrates through the case
of Chile why Samuel Huntington’s theory on the democratization process holds true. I will
simultaneously explain how issues of exclusive political institutionalization, cronyism, and a
strong ethnic divide have hindered democratization in Bolivia. For Huntington the process of
democratization is closely tied to the process of economic development and political
institutionalization. Huntington found that there are certain thresholds regarding gross national
product and growth that help to best facilitate the condition which a non-democratic state would
need for a successful transition. However, with economic reform comes the potential for further
division. According to Walker Conner, when a state focuses too much on modernization it runs
the risk of creating an irreconcilable class divide that prevents democracy from taking hold.4 His
theory on the problem of modernization will serve as a standard for how a state can satisfy the
need for some economic growth without growing too rapidly and therefore preventing a
successful democratization. I argue that one of the key differences between Chile and Bolivia is
that that the pre-democratic Chilean government fostered a reasonable amount of economic
growth and had a longstanding tradition of inclusive political institutions which allowed for a
successful transition to democratic rule. In Bolivia leadership bought into a false promise of
success through populist economic policies and institutionalized a form of cronyism centered on
3 According to Larry Diamond of Stanford, democracy should be conceptualized as a spectrum ranging from liberal
democracy to authoritarian regimes such as North Korea or China.
4 Connor, Walker, “Nation Building or Nation Destroying.” World Politics. 1972 April, vol. 24. No. 3. 328.

4. Freeman 3
certain ethnic groups that has compromised democratization. This is in part why Chile has been
able to rise to one Latin Americas most successful democracies. On the other hand, Bolivia has
been plagued with a multitude of issues stemming from ethno-cronyism that has led to problems
of stability and a government which lacks legitimacy and in many cases popular support.
Both cases have some level of democratization as I will later show through their
comparison. The key differences between the two states lies in the relationship between the
variables of economic growth, nature of transition, and national identity. In Chile the government
has institutionalized a strong executive, widespread participation, and competition which helped
them have a more desirable transformative democratization process. This is known more broadly
as the nature of transition, and because transformations require inclusive political institutions in
order to take place, it appears that they positively influence long term democratization.
Economic growth is also an important factor because if it is done too quickly then cronyism
develops and democratization is hindered. Chile in the 1970s enacted widespread reform that
privatized most industry and created a free-market economy which helped to lessen income
inequality. The third variable of national identity is important because without a cohesive
identity ethnic groups would feel threatened and use the central government as a means to
safeguard their group against others. However, because Chile was successful in tackling the first
two variables, national identity was not an issue at the time of democratization in the 1980s. All
three of these variables came together allowing Chile to be the success of the Southern Cone and
a model for the democratization process.
I will also be looking for how these same variables have impacted the democratization
process in Bolivia. Economic growth in Bolivia has been stagnant or populist in nature
demonstrating the dangers of not meeting Huntington’s threshold for growth. This is

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compounded by the nature of their democratic transition. Bolivia in the 1980s transplaced central
leadership, and this did not require inclusive political institutions with equal amounts of
competition and participation. While most members of Bolivian society were not happy with the
dictators of the previous decades, slowed economic growth without institutionalization created a
system of ethno-cronyism. Lacking a distinct Bolivian identity, full democratization was brought
to a halt. In Bolivia the different nature of these three variables demonstrate further the utility of
Huntington’s theory of democratization.
Figure 1 Chile5 Figure 2 Bolivia
Methodology
In this paper, I will be employing the comparative case study method.6 The reason for
choosing this methodology is because a lot is known about what a state needs to do in order to
democratize and much has been written on the subject, but there seems to be less written about
why two seemingly similar cases had differing outcomes. However, as I will discuss later in my
5 These charts are an illustration of how the relationship of the independent variables impacted the democratization
process within the two cases.
6 The comparative case study method is a method that was outlined by Arend Lijphart in 1971. It is a common
alternative to the case study method that compares two or more similar cases looking for key variables that would
explain why the outcomes differed.
Stable
Institutionalize
d Democracy
Transformation
High Rate
of Growth
Unified
National
Identity
Ethno-Crony
Democracy
Transplacement
Slow Rate
of growth
Multiple
National
Identities

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paper, this is not what happened in these two neighboring states. The comparative case study
method will allow me to analyze both Chilean and Bolivian democratization processes, to
understand what variables contributed to Chile’s success that Bolivia lacks. Of course in
employing this method one must be aware that these are two different places and therefore what
worked for one may not work as well for the other. However, it is still a useful method because
it allows one to compare the situations to look for patterns where things were done differently. 7
For my research it allows me to look at two cases for variables that both help and hinder
the growth of legitimate democracy. The comparative method requires one to begin by
explaining the variables within the study. Lijphart says, the comparative method requires that we
examine a dependent variable that is influenced by independent variables.8 The other two
methods that he mentions are the experimental and statistical methods. The experimental method
has no real implications in political science as it is what we would traditionally conceptualize as
the laboratory method. That is to say that we take variables and set up trials to determine the
effect that one variable has on the other variable. This cannot be done ethically in a social
science where systems of government and entire states are concerned. The comparative method
is in part an adaption of this method. I explained above how the basis for comparison rests on
selecting cases with a certain variable or variables in mind; this is because of the influence of the
experimental method. The experimental method rests on two groups, the control group and the
treatment group. The treatment group is the one being tested, while the control is the unaltered
group. The results of the tests on the treatment group are compared to the control to determine
the effects of the various treatments.
7 Lijphart, Arend, “Comparative Politics and the Comparative Method.” American Political Science. 1971
September, vol. 65. No. 3. 682.
8 Lijphart, 683.

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The comparative method borrows from both the experimental method and the statistical
method. The statistical method unlike the experimental method does work within the field of
political science. However, it relies on the synthesis of many variables and cases, boiling them
down to numbers in an equation or chart. One could use the statistical method for determining
the best path to democratization. However, this method is highly correlative.9 A comparative
study takes the best of both of these methods. It takes the idea of providing a more generalized
theory like a statistical method, but limits the cases and variables like the experimental method.
It too is correlative, but still provides good insights into the actual causal linkages and processes
between variables. Unlike the statistical method, the comparative method works quite well when
looking at just a few cases and is quite useful for my study because I am not interested in a
general prescriptive theory.
Lijphart says that a main drawback to the comparative method is the lack of depth of
study of the cases. Proponents of alternative methods, like the case study, champion it because it
allows one to do a highly detailed study of a particular case. However, as Bent Flyvbjerg points
out, a case study may be used as a preliminary method of analysis in order to draw out a
hypothesis.10 Take the example of Chile, my broader question deals with what Chile did that
Bolivia did not in order to successfully democratize. For me to even be able to do this
comparison, I must first look at the theoretical literature on the phenomenon. Thus, I am
employing a hybrid methodology commonly used in comparative studies, where I take already
available research on the two cases and put them side by side to look for similarities and
differences between them. I observed in my initial research that there is an abundance of
9 Lijphart, 684.
10 Flyvbergj, Brent, “Five Misunderstandings About Case-Study Research.” Qualitative Inquiry. 2006, vol. 12. No.
2. 72.

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literature explaining the individual processes of democratization in the two countries. Thus, I
found that it would be more contributive to analyze what variables differed within the two states
that produced different results with a particular focus on political institutionalization, economic
growth, national identity, and cronyism. Ultimately my conclusions could be used to suggest
potential solutions to the issues preventing success from being obtained in Bolivia.
We come now to the final criticisms regarding the use of the comparative method. Often
those who oppose the use of the comparative method have concerns over case selection and
breadth of study. This is a two-fold criticism that stems from concerns over the utility of
comparison. The primary methodological opposition comes from those who champion the case
study like Flyvbergj. Researchers of that camp argue that because one is attempting a
comparison it is possible that what they find would hold true only for that specific case. Giovani
Sartori characterizes this with the model of apples and pears. He says, “With apples and pears the
issue is easily solved... Returning to pears and apples are they comparable or not? Yes, they are
with some respect to the properties they share…”11 What Sartori is observing is that often times
opponents of the comparative method ask how the researcher decided that the two cases were
comparable, when the question should really be are they more or less comparable. For example,
pears and apples are not identical but they are both fruit and therefore comparing them would
give us insight as to why a pear is not an apple, as well as what traits they do share. When it
comes to political research, this means that while it is true that Chile and Bolivia are two
different places with different cultures and histories, they are still both former Spanish colonies
that had similar political backgrounds. Therefore as Sartori points out, as long as one recognizes
11 Sartori, Giovanni, “Comparing and Miscomparing.” Journal of Theoretical Politics. 1991, 245.

9. Freeman 8
the differences they may find some useful comparisons that could serve to improve the Bolivian
situation, or understand the process of democratization in general.
Theory
After determining the method of study for a given research question, one must select a
theory or theories with which they mean to frame their research. It is not enough to simply take
two cases and decide that one is going to compare them. The meaningful research comes after
deciding to look at these cases through a certain lens or paradigm. For my research question, I
have chosen to look at democratization through Samuel Huntington’s theory. Huntington wrote a
groundwork book that deals exclusively with the most recent wave of democracies. He outlines
the process of democratization in a way that is still widely accepted as a large part of the road
map for state success. His theory is essentially that the democratization process is intertwined
with economic growth. For Huntington one of the key conditions for democracy to arise is being
part of what is coined as an economic transition zone. Countries that are at the middle levels of
economic development with gross national products between one-thousand and three-thousand
per capita GNP in dollars have a better chance of a successful democracy. While for obvious
reasons poorer countries are less successful. In order for a state to have transitioned
economically, that is to have a strong economy, they have most likely democratized.12
12 Huntington, Samuel P., The Third Wave. (University of Oklahoma Press 1991) 60-62.

10. Freeman 9
13
Economic growth alone is not enough, often states that transition to democracy also have
higher level of political participation a subset of what he coined in an earlier work as
institutionalization. Institutionalization, legitimacy, and state capacity are the three pillars of
stability.14 If a state faces outside pressure and has met the economic criteria, it is likely
according to Huntington that the process of democratization will begin to take hold. However,
the majority of the democratization process must happen internally through the
institutionalization of inclusive democratic processes. If a state has only favorable economic
growth they have not yet achieved the conditions to successfully democratize. In fact for
Huntington this situation hinders, not helps, democratization.15 A strong economy is useful, but
as I will outline later, states lacking institutionalization cannot tackle the important issue of
national identity. Because Chile is classified as a transformation democracy, it demonstrated that
it already had some inclusive political institutions and a unified national identity.16 If it had not
13 Huntington, (1991)62.
14 Institutionalization is providing inclusive political institutions that allow for all ethnic groups to feel as though
they have representation in the government. In addition, state capacity as Migdal defines is the ability of the state to
enforce the laws and helps to break down situations where multiple national identities exist within a single state.The
third pillar, legitimacy, is whether or not the citizens recognize the government and requires both state capacity and
institutionalization. However, without all three of these it is unlikely that stability will be achievable.
15 Huntington, Samuel P., “Political Development and Political Decay.” (Cambridge University Press:1965) 386.
16 Huntington in describes a transformation democracy as one where the turnoverof power is popularly sup ported by
all classes ofpolitical participants.
1976 Per Capita
GNP (inUSD)
Democratic in
1974
Democratized/Liberalized
1974-89
Non Democratic Total
Percentage of Countries
that Democratized
<250 1 2 31 34 6
250-1,000
3 11 27 41 29
1,000-3,000 5 16 5 26 76
>3,000 18 2 3 23 40
Total 27 31 66 124 32

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had these things then the nature of transition would have most likely been transplacement or
replacement.
Institutionalization is defined by Huntington as a process of acquiring value and stability.
States with higher institutionalization usually have widespread political participation and are
adaptable, meaning that the institutions can change to meet the needs of the citizens without
crumbling.17 Institutionalization is an important part of the democratization process because it is
what allows for successful turnovers of government. In a multi-party democracy without
institutionalization the us-them divide is often perpetuated instead of proper political
participation.18 When this is continued it further embeds cronyism into the state making it that
much harder to move to a successful democracy. In multi-ethnic states such as Bolivia, inclusive
political institutionalization helps to strengthen a unified national identity. A lack of inclusive
political institutionalization can result in a special type of cronyism known as ethno-cronyism.
States that lack a unified national identity often have clearly defined ethnic groups. Usually
members of a particular group place their ethnic identity above their national identity. This is
known as having multiple national identities. In Bolivia and similar states this often strengthens
the us-them divide. It can be remedied by creating institutions that allow all ethnicities to be
represented in the government, thereby creating a strong national identity that supersedes ethnic
identity.
The above are conditions in which a state may have a good chance at democratization but
they do not ensure total success. For example, democratization in the Second Wave was entirely
17 Huntington, 1965, 395.
18 Us-Them divides are a result of improper institutionalization and cronyism. Instead of institutionalizing inclusive
political competition and participation, crony governments institutionalize a fear that if the opposition takes office
that they will enact targeted policies against the previous leadership. Thus the term us -them, the us being those
currently in power and the them being the opposition.Institutionalization remedies this problem by making it the
norm for both sides to work togetherto create policies strengthen the position of all citizens.

12. Freeman 11
because of external pressure. However the Third Wave has shown that democratization is most
successful when it is fostered internally.19 Thus, while it helps to have outside pressure along
with favorably amounts of modernization, something else must also be affecting the success of
democratization. After establishing these conditions Huntington begins to look at what the
catalysts for change are. Huntington observes that among the states that had the above or similar
criterion there were three ways in which democracy was introduced. He coins these as
transformation, replacement, or transplacement. Countries that undergo transformation, like
Chile, have a push for democratization from the political and economic elites within the country.
Whereas, in countries such as Bolivia, transplacement democratization is the norm, meaning that
pressure from the opposition and the elites brings a change in the status quo. When pressure to
democratize comes from the opposition replacement democratization is taking place.20 The
difference between these two alternative methods of transition is in which group is pushing for a
change of leadership. In a replacement transition the elites do not feel as though the current
leadership is doing their job well. However, transplacement leaves all groups with a feeling of
lack of confidence in the current leadership. Because of a lack of inclusive political institutions
both of these methods of transition result in a perpetuation of ethno-cronyism.
A common criticism of the Huntington model of development is that it will lead to
cronyism. The logic is that if a fledgling state rapidly develops economically it will not only
widen class divides, but provide an incentive for those who control the means of growth to run
the government with only their interests in mind. Cronyism is often a product of democratization
attempts because politically influential people within a country recognize that economic growth
is a viable way to keep the majority from becoming disenfranchised. However, once growth
19 Huntington, 1991, 112.
20 Huntington, 1991, 114.

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commences it is difficult to convince those in charge not to line their own pockets. Leadership
becomes so happy with the strong rate of growth that they do not anticipate that the majority will
eventually become irreconcilably angry and likely blame it on democracy.21 While it is easy to
be tempted by the fast track to economic growth this only brings about a mistrust of democracy
from all parties involved. However, scholars since Huntington’s theory have found ways to
remedy the question of growth/modernization vs. legitimate political participation. Huntington
himself even provides a check through his concept of institutionalization discussed earlier, yet
his theory of democratization still leaves the very real potential for cronyism, particularly in
multi-ethnic states such as Bolivia.
The three main problems that arise out of Huntington’s democratization process are
cronyism, us-them divide, and building a national identity. I explicated earlier how
modernization can lead to cronyism and the host of issues that arise from cronyism. In this
section I will focus on the other two. However, in many ways the three are so intertwined that
they must all be solved in order to create a successful democracy. In addition to cronyism
developing out of rapid modernization, it is the case in states such as Bolivia that compounding
ethnic problems may develop. Not only is the state divided on economic lines, but also it is
increasingly the case that certain ethnicities hold more wealth and political power than others.
According to Walker Conner, “Modernization increases cultural awareness of minorities by
making their members more aware of the distinction between themselves and others...”22 This
quote explains why crony politics are often the norm in multi-ethnic states. If institutions are not
created to foster a Bolivian identity then the various ethnic groups use the government to protect
21 Chu, Amy. World on Fire, (Doubleday:2003)147-48.
22 Connor, Walker, 1972, 329.

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their group’s identity. Cronyism develops out of modernization in multi-ethnic states because
they lack the institutions that give the different ethnic groups representation in the political arena.
It is not necessarily the case that cronyism is the outcome of modernization, but rather
that this is a holdover from colonialism. In post-colonial states, one group usually descending
from the first colonists held the majority of the power and wealth. When states were decolonized,
especially resource rich ones, the wealth remained within this ethnic group. Thus, if they were
given the opportunity to gain prominent seats within the federal government, crony policies
would be likely. Conversely the same happens when the majority ethnic group gains control.
However, this comes from the us-them problem that is created from years of colonial oppression.
I find that this type of cronyism is particularly hard to break out of and have coined it ethno-
cronyism. It differs from simple cronyism because it combines the issues of multiple national
identities with economic inequality. In order for this ethno-cronyism to be solved, it is necessary
for a state to create a unified national identity or integrated policy, as well as foster moderate
economic growth alongside institutionalization of political parties and participation.
In contrast to multi-ethnic us-them crony states like Bolivia, Huntington describes a
different subset of problems that arise out of a different type of cronyism. Chile, did not have the
same issues of multiple national identities in the 1980s, however they were not free from
cronyism. Augusto Pinochet, the nationalist military leader of Chile brought to power out of a
similarly tumultuous economic situation, engaged in what I reference as military/party cronyism.
This is similar to the ethno-cronyism, but is in some ways easier to break free from. Huntington
finds that an institutional problem with transition from military rule is the lack of transition of

15. Freeman 14
wealth and power to the new political group.23 Furthermore, when power transition happens
through a coup it is always a possibility that the military could replicate this as needed. The same
can be said about single party systems, in that when they transition to a democracy they may
leave behind certain loopholes that allow for them to easily reassume power should they desire.
I find that military or single party cronyism is easier to combat because it in some ways is
helpful to institutionalizing the processes of democracy, growing the state capacity, and creating
a unified national identity. This form of cronyism did not leave Chile without its disenfranchised
groups. However, the us-them was not as strong because the them was a class distinction not of
an ethnic nature. When power transitioned from the military, they continued the common
practice in these types of states transferring most of the wealth from the state to their class in an
attempt to maintain status as a political force.24 In a state with ethno-cronyism this would have
further strengthened the ethnic divide, but because the abuse of power was not committed against
a specific ethnic group this division did not occur. Instead the citizens at least were able to gain a
sense of democratic participation which ultimately led to the democratic overthrow of the
Pinochet administration in 1988. Thus I have concluded that it is better for a state to go through a
period of authoritarian rule with a pseudo-democracy than it is to have problems of ethno-
cronyism like Bolivia.
23Huntington,Samuel P., 1991, 115.
24 Huntington, Samuel P., 1991, 117.

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Historical Background
25 26
Unlike their post-colonial counterparts in the rest of the world, the Spanish colonies of
Latin America were not granted independence through a political process. Most if not all of the
countries had to fight wars of independence. In Chile and Bolivia this was certainly the case,
with both countries achieving independence within a twenty year span of each other. Chile upon
achieving independence in 1818 was infatuated with the new Enlightenment ideals of
democracy, and her great Liberator Bernardo O’Higgins quickly began to set an independent
government up. This of course included an executive branch, a constitution, legislative branch,
and a judicial branch. However, as most fledgling democratic leaders do, he realized that giving
up his power was not in his personal interest.27 Thus, in 1823 the Great Liberator was ousted in a
coup and legitimate democracy in Chile was put on hold. Bolivia achieved her independence in
1828, and attempted to create a similar government, but was also met with a similar fate. In both
25 "Road Map of Chile and Chile Road Maps." Road Map of Chile and Chile Road Maps.Accessed April 27, 2016.
http://www.ezilon.com/maps/south-america/chile-road-maps.html.
26 "Bolivia Maps. Travel Map of Bolivia. Bolivian Geography. Facts about Bolivia." BoliviaBella. Accessed April
27, 2016. http://www.boliviabella.com/maps.html.
27 Drake, Paul W. “Historical Setting.” Chile a Country Study. Ed. Rex Hudson,(1994:Library of Congress Federal
Research Division)14.

17. Freeman 16
of these countries, we can retrospectively recognize that due to a whole host of issues that they
were likely unaware of, they simply were not at a point in political development where legitimate
democracy was possible. Up until the 1960s, this pattern of authoritarian leaders operating under
the guise of democracy was the norm. However, around this time the next big push for a true
liberal democracy began in both of these countries.
In Chile during the 1960s, the Allende family began to gain political clout just as the
people were looking for a new government. Salvador Allende was a member of the rising
socialist faction within Chilean politics. He came into contention with the military that since the
days of the great Liberator had been a key fixture in the political process of Chile. Traditionally
the military was made up of the wealthiest social classes and because they were instrumental in
securing independence they were able to secure the most important positions within society.
Allende’s populist policies would have limited the political power of the military, yet he did
manage to win the election of 1970. However, the Chilean constitution at the time still gave the
military majority control of the legislative branch. This is a classic example of what Huntington
refers to as cronyism, meaning a government which has democratic institutions that are
frequently used by a certain section of the populous for personal gain. The election was short
lived, but it does serve some symbolic importance. The 1970 election in Chile demonstrated the
people did have the political institutions necessary to hold elections although they had not yet
resolved the issues of cronyism.
Comparison of Democratization Process
In 1973 Allende was ousted and replaced by General Augusto Pinochet. It is important to
understand that this was in many ways a major setback for the democratization process of Chile.

18. Freeman 17
It looked as though he was just continuing the century’s long cycle of authoritarian leadership
that in Chile had been commonplace. However, this coup was different in that it was not brought
upon by the Chilean military alone. The Allende government came to power during a time when
the global political climate was divided between nations that championed ‘liberal-democratic,
free-market’ ideals, and those like the Soviet Union who took a socialist approach to
government. As a result of this ideological conflict, both the United States and Soviets had a
policy of sponsoring ideologically friendly governments throughout the developing world. The
CIA felt that a resource rich country such as Chile with a socialist leader was a bad idea.
Therefore, they created a plan to install the American educated General Pinochet into La
Moneda. In 1973 Pinochet was able to complete this task and while this may have seemed to be
bad for democratization it gave the executive enough power to enact the kind of economic
reforms Huntington says go hand in hand with stable democratization.
It may seem a bit strange that a country with a supposed long history of democracy such
as Chile would have a military coup right after a successful transition of power through a
democratic process, especially considering that Allende had received popular support. However,
upon closer examination of the past one-hundred and fifty years one can see that this democracy
was not consistently legitimate. In fact in the 1930s, the military had again stepped in to
overthrow the elected government in an attempt to preserve the traditional political order.28
While on its surface this may seem like a characteristic of a broken political system and certainly
leaves plenty of opportunity for future coups, this is actually not all that uncommon in states
working towards institutionalized democracy. Scholars have come to characterize this as what is
28 Valenzuela, Arturo, “Government and Politics.” Chile a Country Study. Ed. Rex Hudson, (Library of
Congress:1994) 201.

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known as a hybrid regime.29 When a state is characterized as a hybrid regime this is not
necessarily the worst outcome. Hybrid regimes, particularly those like Chile, do possess some of
the basic frameworks for democracy. Cronyism is often rampant, but, there is some semblance of
an electoral process. While elections are not “fair and free”, the citizens at least can learn what
the electoral process is. Diamond even goes on to say that this helps institutionalize competition
before participation rises.30 This accounts for why researchers characterize the regimes prior to
Pinochet as democratic even though they clearly are not liberally democratic. Fortunately for
Chile, the hybrid regime did not result in ethno-cronyism thanks to the strong institution of the
executive and a strong state capacity.31
The Pinochet coup was a setback for democratization in Chile but it provides some telling
insights into the state of Chilean democratization. As I said earlier, states that have one coup are
highly susceptible to future non-democratic action. Prior to the Allende regime, it can be said
that while political participation was rather limited, the institution of the executive was quite
strong. Even though the military occasionally overthrew the government, Chile at least had a
strong state capacity.32 However, in many ways the Pinochet coup helped the process of
democratization. In the period before Pinochet, Chile had proven that political competition was
institutionalized through a multi-party system. Not only were there a multitude of political
parties, but they were not ethnically centered like in a multi-ethnic state.
29 See footnote 3.
30 Diamond, Larry, “Thinking About Hybrid Regimes.” Journal of Democracy, 2002 April, vol. 13. No. 2. 23.
31 Alongside institutionalization and legitimacy through popular support,state capacity is an essential part in
ensuring the success ofdemocracy. State capacity is defined by Migdal in “Strong State, Weak Societies” as the
ability of the government to enforce its laws on the populous usually through use of a military or police force to co-
opt local dissenters and strongmen.Without it a single national identity cannot be promoted and proper
institutionalization may not occur.
32 Valenzuela, 203.

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Pinochet was able to use his position as an executive to enact crucial economic reforms
that were enforced via his strong executive. Prior to 1973 the state had administered the economy
through some fifty executive agencies which were kept in check by a stronger yet oversight
department. 33 This was for a while a sustainable method of economic growth that rested on
institutionalized political competition. However, it was not sustainable long term, and through
the institution of the strong executive Pinochet was able to privatize and reform the economy
modelling it after the Chicago Boys.34
Chile during the 1970s set the stage in many ways for the democracy that they have
today. In addition to sweeping economic reform the Pinochet regime ushered in a new age of
consolidation of the existing political institutions. Traditionally Chile had four political parties
the communist party, the socialist party, and the Falange and Christian Democrats on the right.35
These parties represented most of the concerns of voter base in Chile and as a result they saw
fewer military coups in the first half of the century. However the Allende election was the first
election that saw widespread participation. As a result the institution of political parties was
stronger than the institution of participation and this contributed to the ineffectiveness of his
regime. This issue of institutionalization gave rise to the Pinochet coup in 1973. While Pinochet
was in office he finally had the means to enact the necessary economic reforms to solve the
current economic crisis. An additional probably unintended outcome was the solution of the
institutionalization problem. He did so by forgoing a popular election, this caused a solidification
of the opposition who wanted their right to a fair and free election back. Thus once the transition
to a market economy occurred, the opposition led by Ricardo Lagos campaigned for the
33 Valenzuela, 218.
34 The Chicago Boys were students ofeconomics out of the University of Chicago who wrote a manual on how to
practice perfect laissez-faire federal level economics. In their manual it is outlined that these policies are best
implemented under a government of authoritarian nature.
35 Garraton, Manuel, Incomplete Democracy,(University of North Carolina Press:2003) 100.

21. Freeman 20
plebiscite of 1988. In a way the Pinochet regime was a test of the strength of democracy and its
institutions in Chile. The country emerged as a much stronger democracy because of this
necessary period of authoritarianism.
The Pinochet regime exemplifies the importance that a hybrid regime can have on the
transformative democratization process. It also explains why authoritarian regimes are the most
often to undergo a process of transformation. Ultimately the reforms of the economy and
institutionalization melded to create conditions which by 1988 caused Pinochet to lose the
constitutional plebiscite, and forced a turnover to truly democratic elections. It is evident that
transformation to democracy in Chile occurred primarily because of key long standing
institutionalized practices within the country. That being said, it would be inaccurate to
characterize the regime prior to 1990 as democratized. The regime was more like the hybrid
conception that Diamond laid out. This turned out to be extremely helpful in ensuring the
successful transformation to liberal democracy because it gave the government enough power to
correct the remaining road blocks to democratization.
Bolivia’s path to democracy started in much the same way but has not seen the same
successes. Just a decade after Bernardo O’Higgins set up his government, Simon Bolivar
achieved his goal of liberating Bolivia from Spanish control. Unfortunately the Bolivian
revolution was, from the beginning, plagued by a distrusting division that was a holdover from
their especially divided colonial period. In 1826 Simon Bolivar, whom the country is named
after, drafted a constitution that would have institutionalized an authoritarian regime to prevent
what he thought would be infighting amongst the elites.36 While he was immediately
36 Gammara, Eduardo A., “Government and Politics.” Bolivia:A country study. ed. Rex Hudson,(Library of
Congress Federal Research Divison:1991) 163.

22. Freeman 21
institutionalizing non democratic processes, he apparently had an understanding of how much of
a problem the class and ethnic divide would be for Bolivian stability. This short lived
constitution was replaced in five short years with a new one that institutionalized a yet stronger
executive, and for the next fifty years Bolivians faced military authoritarian rule.
The foundation for Bolivian democratization came in 1880 in which a constitution was
drafted that institutionalized oversight, political participation, and competition. It seemed as
though things were set to go well, however, participation was not widespread and included only
those of the elite.37 With the ethnic divide only getting stronger through institutionalized
marginalization, democratization as Huntington outlines could not take place. Having a system
of this nature however, highlights why democracy should be conceptualized as a spectrum rather
than one or the other. Bolivia prior to World War II certainly had the foundations of democracy
but it was obvious that there were road blocks preventing liberal democracy. Bolivar created his
constitution because he wanted to prevent what he called political infighting amongst the elites,
which today often leads to issues of cronyism. Even as far back as 1825 it was evident that multi-
ethnic national identities were going to be a problem for Bolivia. The combination of this and the
concentration of wealth and power in primarily the Spanish descendent mining elite, helped to
institutionalize ethno-cronyism. Ethno-cronyism as I will continue to highlight, has been a
persistent thorn in the democratization process of Bolivia.
In 1952 the indigenous people, tired of being dominated by the elites, formed the
Nationalist Revolutionary Movement. The MNR was comprised mostly of disgruntled students
and Chaco War38 veterans led by the exiled Victor Paz Estenssoro.39 This war was a tipping
37 Gammara, 164.
38 The Chaco War was a conflict between Paraguay and Bolivia over the disputed Chaco Desert territory. This
territory had minor oil fields and was a chance for the Bolivian elite, who recently saw the collapse of their major

23. Freeman 22
point which served to demonstrate the ineffectiveness of the then current government. The Chaco
War was lost in large part because of the ineffectiveness of the central government plagued with
the traditional problems associated with illegitimacy.40 The traditional parties had advocated for
the war and were blamed for the loss. After the war they had banded together in an attempt to
consolidate and maintain power. The indigenous Bolivians realized that change would not come
peacefully and subsequently overthrew the existing oligarchy. However, this did not bring about
legitimate democracy, for the next thirty years the Bolivians had traded rule by mining elites for
indigenous ethno-cronyism.
In 1982 Bolivia finally transitioned into a popularly elected civilian president Hernán
Siles. However, because of the thirty years of corrupt, often authoritarian rule, he inherited a host
of problems including a five billion dollar debt, and a poor disenfranchised population that had
turned towards the illegal drug trade for survival.41 The Siles government only lasted three years
as he found it increasingly hard to maintain stability through democratic means. His successor
was the organizer of the 1952 revolution Victor Paz. Paz inherited much of the problems of his
predecessor and feared a return to the oligarchies of old, thus he reverted to rule by executive
decree in order to maintain stability. For Bolivia this is a classic example of the type of divide
that comes from having economic inequality, but also multiple national identities. As a result of
colonization an us-them state was created. Walker Connor writes that in states that have a history
of ethnic divide, in this case Spanish descendants vs. indigenous Bolivians, developing a unified
export tin, to prove that the traditional (1880) way of governing Bolivia was still working. The loss of the war
proved to be a catalyst for action from a growing discontented majority of middle-class, and poor, marginalized,
Bolivian natives. This is what brings Bolivia onto the path towards reforming their democracy, but again shows just
how large the multi-ethnic divide had become.
39 Waltraud K. Morales, “Bolivia.” Politicsof Latin America: The Power Game. ed. Harry Vanden and Gary
Prevost,(Oxford University Press:2015) 490.
40 Waltraud, 489.
41 Waltraud, 495.

24. Freeman 23
national identity and having inclusive intuitions is crucial for establishing legitimate democracy.
Otherwise, a cycle much like what Bolivia is going through becomes the norm. In an us-them
state often one group resorts to cronyism and executive decree out of fear of being marginalized.
This is known as the us-them problem, which is to say that both sides fear the dominance of the
other and is common in post-colonial developing states.42 Bolivia has the added problem of
income inequality that stands as a road block to liberal-democracy.
43,44
45,46
In many ways Bolivia is an excellent example of both rampant cronyism and the after
effects of what Huntington says happens when there is not simultaneous political
institutionalization alongside economic reform and growth. Bolivia like much of Latin America
has managed to become increasingly more inclusive eventually leading to the election of populist
42 Connor, Walker, “Nation Building or Nation Destroying.” Cambridge University Press. 1972 April, vol. 24. No.
3. 341.
43 “World Development Indicators.” World Bank.
http://databank.worldbank.org/data/reports.aspx?source=2&country=BOL&series=&period= (April 8, 2016)
44 This data replaces the Gross National Product data that Huntington references in his section on good levels of
economic growth. GNP is no longer the most accurate model for determining growth and has since been replaced by
Gross Domestic Product. The GDP data was selected based on politically impactful events in each of the countries.
45 "Chile vs. Bolivia." - Demographics Comparison. Accessed April 28, 2016.
http://www.indexmundi.com/factbook/compare/chile.bolivia/demographics.
46 Chart depicts the ethnic makeup of the two cases in a side-by-side comparison. This highlights the difference in
ethnic makeup between the two cases,which has an impact on the strength of national identity within the two cases.
Per Capita GDP Bolivia Chile
1960 152.5 547.3
1970 225.7 939.3
1973 263.2 1,624.30
1977 616.7 1,243.10
1982 958.7 2,103.80
1988 697.4 1,937.70
1990 709.9 2,401.50
1994 806.2 3,943.00
2000 1,007.00 5,229.20
2014 3,124.10 14,528.30
Ethnic Groups Chile Bolivia
White/ Non indigenous 88.90% 15%
Other Indigenous Groups 11.10% 0
Mestizo 0 30%
Quechua 0 30%
Ayamara 0 25%

25. Freeman 24
president Evo Morales. Unfortunately this inclusiveness is not good for the process of
democratization. Bolivia has always struggled with a social divide between the poor indigenous
majority of the Altiplano and the rich land owning Spanish descendents.47 Fukuyama says that
this problem at its core has to deal with a combination of Huntington’s problems with rapid
modernization, and the lack of wide spread institutional stability. This prevents the government
from both satisfying the needs of the new political participants while not compromising on
democratization.48 While the participation of the indigenous poor is more than welcomed, it puts
those within the government into a situation where they have to contend with maintaining the
support of their constituency while enacting policies that will benefit the whole. Often it is the
case that these policies provide more long-term stability and growth, which is why they are a
hard sell to those who want to see the most immediate benefit. This explains why it is common
for a popularly elected “peoples” leader to dismantle the institutions of democracy instead of
building them up. In Bolivia this is a cycle that recently has meant occasional coups by those in
the wealthy Altiplano followed by a popular election and then the process repeats.
Conclusions
As you can see from the analysis of Chile and Bolivia, there are a few variables that stand
out in helping and hindering democratization. These are the variables of institutionalization,
economic growth, ethno-cronyism, nature of transition, and national identity. Above all it is
evident that inclusive political institutions, transformative democratization, and a high rate of
economic growth helped Chile to successfully democratize. I saw through my research that Chile
at many times had authoritarian leaders, but they still managed to maintain some of the
47 Fukuyama, Francis, “The Latin America Experience.” Journal of Democracy. 2008 October, vol. 19. No. 4. 71.
48 Fukuyama, 72.

26. Freeman 25
institutions that strengthen democracy. Pinochet may have overthrown the government in 1973,
but he took the necessary steps to consolidate power allowing him to implement key economic
reforms that largely encouraged widespread economic participation. As a result of strong
inclusive institutions, in the 1988 plebiscite Ricardo Lagos was able to organize the opposition
and successful win a vote of no confidence causing a turn of government. The transformative
nature of transition was possible because Chileans have a long standing tradition of inclusive
political institutions. This has been a long term success for Chile because Pinochet was able to
keep the government from turning towards ethno-cronyism and institutionalizing an us-them
divide.
Today, Chile is known as a major economic player in Latin America. Since the 1988
plebiscite Chile has not been entirely free from issues of economic inequality. However, they
have not had to deal with issues of military coup and have maintained a unified national identity.
Furthermore, political participation is widespread and a healthy amount of competition has been
the norm for Chilean democracy. It is safe to say that Chile has been a model for Huntington’s
theory of institutionalization and transformation democracy. If Chile wishes to continue on this
prosperous path they must focus their efforts on bridging the economic inequality gap and
bringing up the rate of education as educated voters make for better political participants.
Bolivia unfortunately, embodies most of the issues of exclusive institutionalization and
the issues of rapid modernization that Walker Connor advises against. While Bolivians have
always had a strong executive, until recently political participation was limited to only the land
owning elites. In addition to this, their economy is largely resource based and suffered greatly
after the tin bust of the 1930s. Things began to look better for Bolivia with the indigenous and
middle class movement for democracy that took place under Victor Paz in the 1950s. However,

27. Freeman 26
this was short lived and helped institutionalize a cycle of fear that lead to ethno-cronyism. The
next roughly thirty years featured authoritarian rule by leaders that were fearful of the other
ethnic group ousting them and severely limiting their opportunities. The 1980s were a glimmer
of hope for Bolivia, with the same Victor Paz sponsoring a return to democracy which for the
most part has resulted in popular elections with peaceful turnover of leadership. Transition of
power no longer seems to be a major road block for Bolivia, but issues of ethno-cronyism are
rampant. It has been an increasing trend for the president to be elected from the indigenous
majority and out of the perpetuated, deep rooted, cycle of us-them has been a road block for
democratization.
Frequently policies are enacted in La Paz which benefits one group over the other. It is
also becoming quite clear that economic growth is an issue as indigenous farmers have turned to
the highly profitable coca trade, as legitimate business remains in either the hands of the elites or
in foreign investment.49 The coca trade has become one of the main issues for La Paz since the
nineties. Policy decisions are often dependent upon what ethnic group holds the office of the
president at the time. Evo Morales, the current president and of indigenous descent has pushed
for a campaign titled Coca is not Cocaine. The coca trade is largely run by indigenous Bolivians
who have no other viable options for earning a living. The stance that the government takes on
the trade seems to be dependent on which ethnic group holds the office. For example President
Hugo Banzer a former dictator came to power in the late nineties and sponsored a major
eradication of the Cocalero.50 He was subsequently praised internationally by other ‘developed’
states, but internally these policies were known to be harsh and oppressive against the native
majority. President Morales has pushed to for an increase of rights of the ethnic majority.
49 Waltraud 482.
50 Waltraud, 496.

28. Freeman 27
However, he too has fallen prey to the us-them divide and does so without being incorporative of
the elite minority.
For Bolivia the issue of ethno-cronyism is not resolvable by increasing the rights of
oppressed groups alone. In fact, Bolivia has a systemic issue that dates back to the original 1826
constitution drafted by President Bolivar. The original constitution institutionalized an executive
that was far stronger than his legislative branch. The legislative branch in legitimate democracies
is supposed to serve as a check on the executive, but for Bolivia it serves as a rubber stamp. At
one point in their history all of the members of Bolivian parliament were from the elite party of
the president. Even if Morales manages to increase political inclusiveness he will need a strong
legislative institution if he wants policies to be enacted that represent the diverse ethnic make-up
of Bolivia. As for the issues surrounding the coca trade and the elite control of business, in order
for the proper economic growth to take place that Huntington suggests, economic efforts must be
made to eradicate the coca trade, while offering viable alternatives to the poor indigenous
Cocaleros. These policies must also be sure to include the wealth controlling elites of Santa
Cruz, or else the institution of ethno-cronyism will continue into the foreseeable future.
Ultimately the state of affairs in Bolivia is not all doom and gloom. Since 1988 Bolivia
has not had any military coups. The office of the executive has successfully turned over between
political parties across the spectrum and political participation has been on the rise. Bolivia like
Chile, would do well to focus a good deal of effort on bringing up the education rate amongst
those not from the mestizo elite, as this too would help to alleviate the ethno-economic disparity.
Bolivia would also benefit from a stronger state capacity as this helped Chile immensely in the
1970s and 80s when crucial economic reforms were being implemented. With a stronger state
capacity Bolivia would also be better equipped to handle the Colombian Cartels that have made

29. Freeman 28
their way into the Altiplano to purchase coca for processing into cocaine. In order for the
necessary economic opportunities to rise, Bolivians should work to bring in more foreign
investment as this helps to alleviate the dependence upon a resource economy which is too
dependent upon the volatile commodities market.
Overall, my analysis of the cases of Bolivia and Chile has shown me the importance of
institutionalization and nation-building. While the two cases have resulted in different outcomes,
the nature of transition, the nature of democracy, and economic growth, have proven to be key
components in the success of democracy. Initially I expected to find that Chile may have had
some key difference from Bolivia that greatly altered the success of democratization. What I
ended up finding was that the two countries have or at one point, had dealt with a lot of similar
issues. Bolivia’s most immediate issue is institutional reform. As long as the executive is
stronger than the legislative democratization will remain incomplete. It would not surprise me
that after this is done the issue of ethno-cronyism may become much easier to solve. For now, it
would seem that Huntington and Walker Connor were correct in surmising that a strong national
identity helps to alleviate ethnic issues, and that institutionalization alongside moderate
economic growth helps governments transition from hybrid regimes to liberal democracies.