C4FE Economic Insights #8

The Center for Free Enterprise's latest Economic Insight is out. In this case, Luis Báez (new research assistant) discusses who is Claudia Sheinbuam, the new Mexican president-elect.

Populist movements and parties have become major political players worldwide, and their influence is particularly pronounced in Latin America. Scholars have explored the economic impact of enduring left-populist policies, consistently finding economic and social costs. For example, Kevin Grier found that real per-capita GDP fell 20% on average, while Sebastian Edwards points out that in most instances, populist policies resulted in runaway inflation.

In Mexico, the National Regeneration Movement (Morena) is a left-wing populist party that has held presidential power since 2018 and recently won the 2024 presidential elections. Morena was created in 2012 by Andres Manuel Lopez Obrador (AMLO) as a civil association and social movement. In the most recent report by V-Dem’s Populism Index (0 not populist to 1 most populist), Morena scored 0.98, significantly ahead of the Labor Party's 0.655, underscoring Morena's strong populist orientation. In less than a decade, Morena has achieved political hegemony. Today, Morena controls the presidency and the governorships in twenty-four states and secured majority in both houses of Congress.

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