This detailed economic history of Mexico advances a theory about how rent seeking permits economic growth. The book explains why political instability is not necessarily correlated with economic stagnation. It addresses the puzzle of growth amidst instability by combining analytic tools and theoretical insights from history, political science and economics. This study is for historians of Latin America, scholars interested in economic development, and political scientists interested in the political foundations of growth.

This innovative new book contributes simultaneously to two different disciplinary fields: comparative political economy and Mexican history. It does so by attempting to explain why Mexico - contrary to the predictions of several dominant theories of economic growth - enjoyed a comparatively high rate of economic growth and development under the highly authoritarian dictatorship of Porfirio Diaz (1876-1911). In conducting a detailed political analysis of Diaz's rule, Armando Razo introduces network analysis to the study of institutions and growth, and shows how dictators can maintain their power with credible growth-enhancing policies.

This book addresses a puzzle in political economy: why is it that political instability does not necessarily translate into economic stagnation or collapse? In order to address this puzzle, it advances a theory about property rights systems in many less developed countries. In this theory, governments do not have to enforce property rights as a public good. Instead, they may enforce property rights selectively (as a private good), and share the resulting rents with the group of asset holders who are integrated into the government. Focusing on Mexico, this book explains how the property rights system was constructed during the Porfirio Diaz dictatorship (1876-1911) and then explores how this property rights system either survived, or was reconstructed. The result is an analytic economic history of Mexico under both stability and instability, and a generalizable framework about the interaction of political and economic institutions.