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Class Struggle

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Latin American Research Review, Vol. 38, No. 1, February 2003© 2003 by the University of Texas Press, P.O. Box 7819, Austin, TX 78713-7819LATIN AMERICAN CLASS STRUCTURES:Their Composition and Change during the Neoliberal Era1Alejandro Portes and Kelly HoffmanPrinceton UniversityAbstract: This article proposes a framework for the analysis of social classes inLatin America and presents evidence on the composition of the class structure inthe region and its evolution during the last two decades, corresponding to theyears of implementation of a new economic model in most countries. The paper isan update of an earlier article on the same topic published in this journal at theend of the period of import substitution industrialization. Relative to that earlierperiod, the present era registers a visible increase in income inequality, a persis-tent concentration of wealth in the top decile of the population, a rapid expansionof the class of micro-entrepreneurs, and a stagnation or increase of the informalproletariat. The contraction of public sector employment and the stagnation offormal sector labor demand in most countries have led to a series of adaptivesolutions by the middle and lower classes. The rise of informal self-employmentand micro-entrepreneurialism throughout the region can be interpreted as a di-rect result of the new adjustment policies. We explore other, less orthodox adap-tive strategies, including the rise of violent crime in the cities and migrationabroad by an increasingly diversified cross-section of the population. The impactthat changes in the class structure have had on party politics and other forms ofpopular political mobilization in Latin American countries is discussed.During the last decade of the twentieth century, Latin America experi-enced a momentous change as country after country abandoned the au-tonomous industrialization path advocated by its own intellectuals of anearlier period and embraced a new model of development based on openeconomies and global competition. Neoliberalism, as this model is dubbed,is actually a throwback to an earlier era when Latin American countriesparticipated in the world economy on the basis of their differential advan-tages as producers of primary goods while importing manufacturers andtechnology from the industrialized world. It was the vulnerability of thoseexport economies to the ups and downs of external markets that the1. We thank Emilio Klein for assistance in our preliminary assembling of data for thispaper and Peter Evans, William Smith, and Susan Eckstein for their comments on anearlier version of the paper. Responsibility for the contents is exclusively ours.03-Portes.Rev.(6.5) 7/16/03, 2:49 PM4142 Latin American Research Reviewneo-Keynesian import substitution policies of the mid-twentieth centurywere designed to overcome (Prebisch 1950; Furtado 1970).2The policies advocated by the resurrected liberal orthodoxy and the“Washington consensus” that gave it ideological momentum have beendescribed at length in the contemporary social science literature (Sunkel2001; Robinson 1996; Portes 1997). So have the consequences of thesepolicies, in terms of both economic growth and social equity (Filgueira1996; Roberts 2001; de la Rocha 2001). Less studied have been the effectsof this profound re-orientation of Latin American countries on their so-cial structures and, in particular, their long-term patterns of social strati-fication. The class structure of these societies could not and has notremained impervious to these major changes in their productive orga-nization and global trade patterns. While international organizationssuch as the International Labour Office (ILO) and the United NationsEconomic Commission for Latin America and the Caribbean (ECLAC)have tracked the evolution of poverty and inequality in the region, theiranalytic approach has precluded them from analyzing these trends froma systematic class perspective (ECLAC 2000; ILO 1999).The concept of class is commonly excluded from these official publi-cations because of its Marxist origin and consequent evocation of no-tions of conflict, privilege, and exploitation (Grusky and Sorensen 1998;Wright 1997). Yet its omission obscures significant aspects of contempo-rary social dynamics and deprives us of a valuable analytic tool. In thispaper, we seek to correct this shortcoming by re-introducing an explicitclass framework in the analysis of contemporary Latin American societ-ies, providing empirical estimates of its various components, and exam-ining how they have varied across countries and over time. This analysiscan be read as an explicit extension and revision of an earlier article,published in this journal eighteen years ago, that sought to map theclass structure of Latin American societies at the very end of the importsubstitution period (Portes 1985).CLASS STRUCTURES IN CENTER AND PERIPHERYThe concept of social class refers to discrete and durable categories ofthe population characterized by differential access to power-conferringresources and related life chances. In capitalist societies, such class-2. In addition to the raw materials and foodstuffs that were Latin America’s basicexport commodities in an earlier era, the contemporary export model highlights indus-trial exports, generally produced by multi-national subsidiaries and other foreign-ownedfirms in export-processing zones. The forms adopted by this novel insertion of periph-eral countries in global commodity chains have been discussed at length by Gereffi (1989,1999), Castells (1998; Castells and Laserna 1989) and Korzeniewicz and Smith (2000).03-Portes.Rev.(6.5) 7/16/03, 2:49 PM42LATIN AMERICAN CLASS STRUCTURES 43defining resources are explicitly tied to markets and the ability of indi-viduals to compete effectively in them (Weber [1922] 1965; Veblen [1899]1998; Mills 1959). While orthodox Marxist theories commonly con-strained class resources to the possession of capital and the means ofproduction versus ownership of raw labor, recent theories have adopteda more flexible approach encompassing other power-conferring resourcessuch as control over the labor of others and possession of scarce occupa-tional skills (Grusky and Sorenson 1998; Wright 1985; Carchedi 1977;Poulantzas 1975).The common advantage of class analysis, both classic and contem-porary, is its focus on the causes of inequality and poverty and notjust its surface manifestations, as commonly done in standard


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