In Central America, dynamic economic actors have inserted themselves into global markets. Elites atop these sectors attempt to advance a state-building project that will allow them to expand their activities and access political power, but they differ in their internal cohesion and their dominance with respect to other groups, especially previously constituted elites and popular sectors. Differences in resulting state-building patterns are expressed in the capacity to mobilize revenues from the most dynamic sectors in quantities sufficient to undertake public endeavors and in a relatively universal fashion across sectors. Historical, quantitative and qualitative detail on the five countries of Central America are followed by a focus on El Salvador, Honduras, and Guatemala. The greatest changes have occurred in El Salvador, and Honduras has made some advances, although they are almost as quickly reversed by incentives, exemptions and special arrangements for particular producers. Guatemala has raised revenues only marginally and failed to address problems of inequity across sectors and between rich and poor.
Aaron Schneider is the Jill H. and Avram A. Glazer Professor of Social Entrepreneurship and Associate Professor of Political Science and Latin American Studies at Tulane University. He is especially interested in the sources of and uses for the wealth of states, including taxation and expenditure. By treating public finance as a window into the politics of economic development, his work characterizes the way in which state actors interact with the evolution of global capitalism. He has conducted research in Central America, Brazil, Peru, India, sub-Saharan Africa and closer to home in New Orleans. With a mix of quantitative and qualitative methods, Professor Schneider's outputs have included journal articles, book chapters, working papers and policy briefs. Prior to joining Tulane University, he was a Fellow at the University of Sussex in the Institute of Development Studies (IDS) and Advisor to the Chief Economist for Central America and the Caribbean at the Interamerican Development Bank.
1. Revenues, states, and Central America; 2. State-building in a globalized political economy; 3. Historical junctures in Central American state-building and tax; 4. 1990s transnational integration: quantitative evaluation of socioeconomic actors, democratic institutions, and tax regimes; 5. Inside-out state-building in El Salvador: dominant and cohesive transnational elites; 6. Outside-in state-building in Honduras: dominant but divided transnational elites; 7. Crisis in Guatemalan state-building: divided, subordinate transnational elites; 8. Conclusion: state-building and tax in developing countries.