State Capture and the Role of Political Parties in Latin America

This study explores the impact of political parties on state capture in Latin America. A mixed effects model is used with time as the level one unit nested within countries that serve as the level 2 units with a total sample size of 349 observations pooled across 19 different Latin American countries with data ranging between the years 1996-2017. The model is also estimated with an AR(1) term in order to account for the temporal dimension of the analysis and any problems autocorrelation may pose. First, the impact of political party in power [years], a variable that captures how long one political party is able to stay in power in a given country in years – is analyzed for its effects on state capture. Second, the impact of political party in power [years] on state capture at varying levels of economic development as measured by GDPPC is then examined. The analysis provides support for the negative impacts of political party in power [years] on state capture where the longer one party is able to remain in power – the greater state capture we will see. Overall, the results suggest that a lack of political competition and horizontal accountability that political parties are able to provide in a given country results in enhanced levels of corruption and state capture across the Latin American region