Nicaragua: institutions-constrained growth

Alvaro López-Espinoza, Umanzor López-Baltodano and Mayerli Obando Chamorro

Chapter 25 in The Elgar Companion to the Economies of Latin America and the Caribbean, 2025, pp 504-520 from Edward Elgar Publishing

Abstract: This paper delves into the transformative impact of institutional dynamics on Nicaragua's socioeconomic development, tracing shifts from the Sandinista redistributive initiatives to contemporary autocratic governance. Utilizing theoretical frameworks that highlight the importance of inclusive versus extractive institutions and development as an enhancement of human capabilities, the analysis underscores how institutional changes directly influence economic stability and societal progress. It explores historical transitions, noting how periods of inclusive policymaking alternated with extractive governance, notably under Ortega's recent rule, exacerbated by the COVID-19 pandemic. This backdrop of shifting governance models illustrates the profound effect on Nicaragua's economic trajectory and social fabric, leading to periods of crisis and recovery. The study advocates for a robust reconstruction of institutional structures to encourage inclusivity and transparency, essential for navigating Nicaragua's complex political landscape and fostering sustainable development.

Keywords: Nicaragua; Economic growth; Institutional dynamics; Inclusive institutions; Extractive governance (search for similar items in EconPapers)
Date: 2025
ISBN: 9781035317196
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