The Economy of Bolivia
Growth, Redistribution and the MAS Era
From 2006 to 2019, Bolivia enjoyed strong growth, falling poverty and inequality, and stable prices under the Movement Toward Socialism.
A relatively stable period.
Growth
GDP grew about 4 to 5 per cent a year during the commodity boom.
Social policies
Cash payments to children, the elderly and mothers.
Stability
Low inflation, a stable exchange rate and large reserves.
Critique
Heavy reliance on gas and state spending left the economy vulnerable when prices fell.
A pension payment
Older Bolivians began to receive a universal pension called Renta Dignidad.
Assuming a stable period means a sustainable model
The model relied on commodities.
Key takeaways
- Growth averaged 4-5%.
- Cash transfers reduced poverty.
- Prices were stable.
- Vulnerabilities built up.
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