9320878 Mahon This research investigation engages ideas about taxation and state formation, in seeking to account for the pattern of tax reform and nonreform across Latin America since the onset of the debt crisis in 1982. The debt crisis, because it called for a large private-to-public transfer of resources in order to fund increased debt service, directly or indirectly spurred fiscal changes. Yet, not all countries reformed taxes substantially in this context, and those that reformed did not do so in the same way or with the same results. This study will explore hypotheses relating the degree and nature of tax reform to international capital mobility, to a country's experience of economic crisis, to international influences, and to the electoral cycle. The investigator will retrieve relevant data in library research at William College, Yale University, the International Monetary Fund (IMF), and the Library of Congress. This will be supplemented by interviews with tax experts at the IMF and elsewhere. The data will include measures of tax revenue as a proportion of Gross Domestic Product; the stock of overseas capital held by residents, as a proportion of gross fixed capital formation; level of investment; inflation; GDP growth; and information about formal communications with international financial institutions. The research involves two pooled time- series designs, one with thirteen countries and the other with seven, both over the fifteen year period, 1977-1991. This research is especially relevant today, as Latin American governments face a potentially sharp conflict between dealing with worsening social problems and winning the confidence of international investors. Tax reform may be one way to moderate this conflict. This investigation will deepen our understanding of this aspect of state competence in Latin America. ***
