Exceptional Argentina Di Tella, Glaeser and Llach - Thomas Piketty

Transition Remarks
Economic success is often associated with rule of law, and Argentina’s economic stagnation has
often been associated with an apparent deterioration in the quality of government services. The
increased equality after 1946, shown in the previous chapter, can paint a misleading picture
about quality of life for poorer Argentinians if they were also facing an increasingly problematic
public sector. The next chapter looks specifically at one important public service—policing—and
compares 20 th century developments in Argentina and Chile. The comparison with Chile is
important, because it provides a reasonable benchmark for expectations about policing quality.
The paper begins with modern survey data about corruption and trust in the police. Chile is today
an outlier in Latin America, with surprisingly high levels of trust in its police system and
apparently a remarkably low level of bribery. Surveys suggest far less trust of police in
Argentina and that bribery is far more widespread. Argentina is not unusual in Latin America,
where policing problems are standard, but it is unusual given its relatively high levels of wealth
within the region. While Chile has distinctly more trust in its police than is typical for its income
levels, Argentina has distinctly less trust in its police than its level of economic development
should warrant.
The authors then take us back to the start of the 20 th century when conditions appear to have
been completely reversed. In those years, Chilean policing was known for corruption, while
Argentina appears to have had the best policing in Latin America. Chile appears to have taken
steps over the 20 th century which gradually led to a highly professional, independent and honest
police force, while Argentina primarily saw deterioration in its policing quality.
The authors ask two questions about these changes. First, what policies explain the differences
between Argentina and Chile. Second, what political forces help to explain the different policing
strategies.
Boruchowicz and Wagner make the reasonable observation that simple stories about police
compensation cannot explain the gap. Corruption is often excused as a response to low wages,
but there is no discernible difference in the level of compensation between Argentina and Chile.
Instead, the difference appears to come from at least three institutional features in Chile.
First, the Chilean system is national and highly independent of local politicians. Argentine
police, like the U.S., are far more local and as a result they are more subject to capture by local
political elites. Second, the Chilean system is set up to encourage rotation of policing across
districts. The constant flow of fresh policemen makes it more difficult to establish the long-run
relationships that enable corruption. Finally, the Chilean system emphasizes recruiting better
educated personnel for the police and compensating them with some eye on competence and
honesty.