Comparative Economic Studies

, Volume 57, Issue 3, pp 539–568 | Cite as

Venezuela 1999–2014: Macro-Policy, Oil Governance and Economic Performance

  • Leonardo Vera
Symposium Article


During the administration of President Chavez, Venezuela registered some celebrated and encouraging socio-economic achievements, however; in the macroeconomic realm the country underperformed compared with other countries in Latin America of a similar size. The country, for instance, did not manage to avoid recurrent external crisis, suffered from unprecedented net transfers of financial resources abroad and, despite the oil windfall, has not accumulated a strong level of defensive international reserves. Moreover, inflation has been rampant and output growth has been very volatile and, on average, poor. This study provides a descriptive account and analysis of Venezuela’s macroeconomic performance and policy experience during the administration of President Chavez and his handpicked successor, Nicolas Maduro (1999–2014). It focuses on the major policy and institutional changes, and on the problems and imbalances of the economy to find out and explore the conundrum of Venezuela’s economic underachievement. We evaluate Venezuela’s exchange rate and monetary policy and the key commitments of the Central Bank to society. In general the study suggests that macroeconomic mismanagement and a failed institutional structure of governance are essential to understand some key imbalances. It seems to be the case that the root cause of this macroeconomic mismanagement and poor governance of Venezuela lies in prevailing political and economic incentives.


Venezuela macroeconomic policy Central Bank oil governance real exchange rate 

JEL Classifications

E5 E52 E60 N16 



The author would like to thank Ricardo Ffrench-Davis, Roberto Frenkel, Mario Damill, José Antonio Ocampo, and participants in the workshop on Central Banking at CEDES in Buenos Aires for comments on an earlier draft. Eduardo Ortiz Felipe, Marcos Morales and two anonymous referees provided helpful comments.


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Copyright information

© Association for Comparative Economics 2015

Authors and Affiliations

  • Leonardo Vera
    • 1
  1. 1.Universidad Central de Venezuela, FACES, Escuela de EconomíaCaracasVenezuela

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