How Presidents Answer the Call of International Capital

Prof. David Doyle, University of Oxford

Recent scholarship has provided ample evidence that international capital can press Latin American governments to adopt market-oriented economic policies. Less is known about the ways in which governments manage expectations from international capital owners. Studying 67 annual state-of-the-union speeches in twelve Latin American countries between 1980 and 2014, we show how governments strategically communicates with capital markets. First, when times are dire, presidents not only talk more about the economy and less about social policy, they also attempt to repaint other policies as an investment into the development of the country. Second, using our new method of automatically scaling sub-dimensions from political texts we analyze presidents' cues for economic policy-making more closely. Economic turmoil encourages presidents to signal policies that appeal to international capital owners. Our findings have important implications for those studying political communication, and also for all those concerned about the quality of democratic representation more broadly.

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