Fall of the Washington Consensus

Following Argentina’s default the Washington Consensus seems completely devalued as there seems to be precious little correlation between the degree to which a country embraces reform and the likelihood of its economic success.

Argentina’s crisis has been severe: the economy, the currency, the banking system and, most important, the rule of law have all collapsed simultaneously. So what went wrong, and what lessons can be learnt for the rest of the region?

One fresh and well-received analysis comes from Guillermo Calvo, the Inter-American Development Bank’s chief economist.