Introduction

and explained the Statist and Corporatist models of business adjustment in Argentina and Spain through both national and sectoral evidence. In the Statist mode, the government organized top-down reconversion plans based on the allocation of subsidies that benefited companies in important sectors such as steel, shipbuilding, home appliances, and aluminum. However, the main established private firms in the sectors subjected to restructuring were eventually wiped out of the market. In Argentina’s Corporatist model, by contrast, the state funneled market-share compensation (i.e., state assets and partial deregulation) to local private companies in the heavy industrial sectors of autos, oil, steel, aluminum, cement, and pharmaceuticals. Building upon these market reserves, formerly protected actors initially thrived in the liberalized economy.

This chapter aims to illuminate a second form of variation in the modes of business adjustment. In terms of the book’s general research design, at a national level, each alternative reform model obviously constitutes a “negative” case of the others. In addition, the case studies that follow indicate variation within countries, that is, core ISI sectors that were not compensated according to the prevalent national model of business adjustment. Correspondingly, these “negative” cases should display a parallel variation in the main explanatory variable within democratic cases – the power of state and private business as they emerged from the ISI model. Unlike in the case of labor – in which adjustment models were more homogeneous nationally – two important basic ISI sectors, petrochemicals and oil, deviated from the general pattern of compensation in Argentina and Spain ().