Subnational electoral regimes and crisis recovery in Argentina and Mexico

The confluence of Latin America's volatile economic development patterns and transition to democracy has given rise to a proliferation of work on the national-level political causes and consequences of economic shocks and recovery rates. We explore the subnational electoral determinants of crisis recovery through analysis of growth rates in Mexico's thirty-one states and Argentina's twenty-three provinces following their economic declines of 2000–2002. Consistent with a theory that views intra-national variations in democracy as critical to understanding broader development patterns, we find that subnational electoral “regimes” significantly affect provincial recovery rates. Provinces that have an established electoral legitimacy prior to the onset of an economic shock, and those in which the governor enjoyed a substantial margin of victory, had significantly stronger recovery rates than those provinces stuck in a subnational regime transition with a sitting executive who lacked any claim to an electoral mandate.

► Subnational political transitions have a significant impact on economic development patterns within countries.
► Evidence for role of gubernatorial electoral mandate in provincial recovery from economic crisis.
► Highlight need to incorporate subnational electoral regimes into political economy of development research.