Social Foundations of Limited Dictatorship: Networks and Private Protection During Mexico's Early Industrialization (review)

There is always a tendency to regard the establishment of "successful" dictatorships teleologically, although to paraphrase Enoch Powell, every political career ends in failure. Armando Razo's principal interest is how Porfirio Díaz came to be a successful dictator, at least in terms of conventional measures of success, such as tenure in office or the putative doubling in the real per capita growth of income. For the half century prior to Díaz's regime, of course, no predecessor even came close. Razo's answer is adequately summarized in the book's title: through the social foundations of a limited dictatorship. Díaz headed an authoritarian government, not a totalitarian state, and there was room for maneuver. The dictatorship was, in a sense, characterized by a sort of stable equilibrium between Díaz and his potential rivals, who ultimately became the beneficiaries of his economic policies as well. What appears very clearly in Razo's research is that the decisive moment for the emergence of "dictatorship" came around 1890, a moment that coincided with the appearance of an economic surplus large enough to be distributed to cement the requisite political and social alliances. The details of this largess are of no interest to Razo, but he points to ways in which mining, oil, communications, and transportation were its likely sources. The anecdotal evidence, while hardly novel, would only confirm the analysis more amply.

What contributed to the evolution of this equilibrium was the emergence of a series of formal and informal institutions embedded in a series of social networks, whose analysis is painstakingly undertaken. Razo's goal is to demonstrate how such networks facilitated—indeed, ensured—that the private appropriation of wealth would continue in the absence of public enforcement mechanisms, for this is what made the arrangement durable. What Razo documents was the emergence of what he terms a stable pool of private enforcers. These were increasingly members of the elite drawn from the military, local politics, and business. They could expect—at least it appears in retrospect—durable careers in public life if they played by the rules, which raised their incentive to cooperate with Díaz. By the same token, economic actors gained greater predictability from a stable structure of governance, if not necessarily from the career of a specific individual. Díaz, in other words, appeared to be in it for the long haul, and thus in a position to make good on his commitments. He was, in short, credible.

In summary, this is an ambitious, thorough, and altogether modern account of the emergence of Porfirio Díaz. Any serious student of the period should read it carefully. However, the formal models underlying the analysis, which appear in Chapter 2, are in gametheoretic form, and probably inaccessible to most readers of this journal. That is inevitable, but it is also a pity. There is a substantial amount of work in economics that now diverges from the rational actor, utility maximization assumptions that are explicitly invoked here. One could possibly think of a different model, perhaps involving social learning and uncertainty, equally appropriate to the time and circumstances of Porfirian Mexico, that might be usefully considered where historical actors have nothing resembling complete information—at least before the fact—and whose choices are so constrained. Some play follow-the-leader simply because the leader survives for one reason or another, not because the leader has got costs and benefits right. This is only to say that the neoclassical fascination with homo economicus is well known to drive serious historians of Latin America a little crazy. And crazy people are known to do, or to write, crazy things. If memory serves, such craziness is precisely what motivated Stephen Haber to establish the Social Science History series at Stanford. The response, as Razo's book shows, is both elegant and eloquent, but...