Journal of Economic Issues

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Bolivia’s Institutional Transformation: Contact

Zones, Social Movements, and the Emergence of
an Ethnic Class Consciousness

Natalia Bracarense & Karol Gil-Vasquez

To cite this article: Natalia Bracarense & Karol Gil-Vasquez (2018) Bolivia’s
Institutional Transformation: Contact Zones, Social Movements, and the Emergence
of an Ethnic Class Consciousness, Journal of Economic Issues, 52:3, 615-636, DOI:
10.1080/00213624.2018.1495986

To link to this article: https://doi.org/10.1080/00213624.2018.1495986

Published online: 28 Aug 2018.

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 JOURNAL OF ECONOMIC ISSUES
Volume LII No. 3 September 2018
DOI 10.1080/00213624.2018.1495986

Bolivia’s Institutional Transformation:

Contact Zones, Social Movements, and the Emergence
of an Ethnic Class Consciousness

Natalia Bracarense and

Karol Gil-Vasquez
Abstract: Over the past two decades, development economics has experienced a shift
in focus from standard neoclassical analysis to institutions. While studying economic
institutions is indeed important, evaluating their transformation and embeddedness is
equally crucial for understanding and improving human wellbeing, especially in countries
where market institutions are not fully developed. With that perspective in mind, we
consider the importance of culture in the evolution of institutions in Bolivia by combining
the concept of contact zones with old institutional economics (OIE). Contact zones refer
to daily interactions in social spaces where culture and class meet and negotiate with each
other. The contact zone between Bolivians and post-WWII development policies surfaced
as an Andean collective memory, allowing for a possibility of social and political autonomy
through the creation of an alternative to development, El Buen Vivir.

Key words: Bolivia, development economics, El Buen Vivir, old institutional economics

JEL Classification Codes: B25, N16, O10

A careful study of Bolivia unveils the great institutional transformation the country has
undergone in the past few decades. As a response to the implementation of neoliberal
policies in the 1980s, indigenous institutional structures were mobilized in an effort to
promote the inclusion of all Bolivians in the political system and to gain more autonomy
from foreign influence (Lehman 2016). Arguably, these changes were galvanized during the
2002 Gas War, when protests against the government’s handing over control of the nation’s
natural resources to foreign investors forced the resignation of President Gonzalo Sanchez de

Natalia Bracarense is an assistant professor of economics in the Department of Economics at North Central
College (Naperville, IL). Karol Gil-Vasquez is an assistant professor of economics in the Department of
Economics at Nichols College (Dudley, MA).
615
© 2018, Journal of Economic Issues / Association for Evolutionary Economics
616 Natalia Bracarense and Karol Gil-Vasquez
Lozada and the nationalization of Bolivia’s hydrocarbon resources—with greater involvement
of Aymaras and Quechuas in the country’s political life.
The vitality of these mobilizations culminated in the presidential inauguration of
Evo Morales, the first self-identified indigenous president in Bolivian history. Since 2002,
Bolivia has gone through institutional reforms that represent alternatives to adjustment
programs prescribed to the Global South by the International Monetary Fund (IMF) and
the World Bank. Bolivia’s response to market liberalization is informed by the ideal of El
Buen Vivir1 which embraces the Andean view of communal wellbeing and refers to a pluralist
model of democracy: a model that is participatory and representative, involving direct and
community-based political processes (Schavelzon 2015). In the following years, Andean
values of reciprocity and solidarity gained momentum, making their way into the country’s
constitution and informing Bolivia’s domestic and foreign economic policies. This symbiosis
between the state and indigenous communities represent a hybrid space where the latter
request the state’s presence to guarantee respect of economic, social, and political diversity.
Bolivia’s tapping of ceremonial institutions as instruments of resistance could be seen
as a double movement (Polanyi [1944] 2001), in which resistance to change works as a self-
protecting mechanism against the destruction of the human and social ethos. In Karl Polanyi’s
view, great transformations take place through pushes for social change and counteracting
responses in a way that resistance does not stop the pervasive forces of the market system, but
rather embeds them in social institutions that further their functioning.
The heavy reliance on exportation of primary resources and the latest ecologically
controversial developments in the country, such as President Morales’s plan to construct
the TIPNIS highway,2 could lend support to such an interpretation. Additional support is
provided by decreased gas prices, heightened uncertainty regarding diplomatic relations with
Bolivia’s two largest markets, Brazil and Argentina, and its Venezuelan ally, and the negative
1
Regarding the conceptual nature of el Buen Vivir/bien vivir as well as its meaning as a referential point
in the political discourse, a significant amount of literature has been published in recent years with regard to
Ecuador and Bolivia (Gudynas and Acosta 2011; Manosalvas 2014). To summarize, the concept entails the
satisfaction of the human spirit—for instance, the need to love and to be loved—as well as the healthy flourishing
of everyone—in peace and harmony. It also includes human interaction with nature, their symbiotic reproduction,
and the infinite prolongation of human cultures. El Buen Vivir/bien vivir presupposes that liberties and
opportunities, capacities, and real potentialities of individuals broaden and flourish in a way that allows to
simultaneously accomplish what societies, territories, and diverse collectivities identify as a desired way of life. It
is important, however, to keep in mind that there are several instances and interpretations of the term (Hidalgo-
Capitán and Cubillo-Guevara 2014).
2
The TIPNIS conflict between the Morales administration and the traditional bastions of MAS support
(i.e., campesinos, cocaleros, and colonists), on one hand, and the Yucare, Moxeño, and Chiamne peoples, on the
other, rested on the administration’s plan to build a highway that connected the Amazonian and Andean regions.
This highway was to cross TIPNIS, a 3,860 square mile collectively owned reserve, which would put under risk
one of the world’s most biodiverse regions, with unique flora and fauna, and forest that help regulate water and
climate cycles. After heated conflict, Morales signed a law permanently canceling the TIPNIS portion of the
highway and protecting the indigenous territory. The reversal of the TIPNIS road, however, cost the president’s
popularity among his political base (NACLA 2014).
 Bolivia’s Institutional Transformation 617
impact of these factors on the government’s ability to continuously implement social policy.
For example, most of the social changes implemented during Morales’s first two terms were
financed through a booming hydrocarbons market (Lugo 2015). Morales’s administration,
in fact, has failed to represent Bolivia’s envisioned alternative development strategy, founded
on respect for the Pachamama (Mother Nature) and El Buen Vivir (the good life) (Albo 2015).
Furthermore, Morales has been severely criticized for his soft stance on the IMF and the
World Bank and his unwillingness to compromise his political power which, according to
his own political base, puts Bolivia on a path of sluggish change and attachment to western
notions of progress.
In our view, these latest developments emphasize the complex nature of institutional
transformation. The interchange between external institutional practices and subordinated
or marginal groups in the historical process, nonetheless, has materialized into economic and
political systems that do not mirror the western model,3 implying the possibility of alternative
patterns to development. It is this interplay between agency, structures, and contexts of action
that prompts us to focus on development theory as the study of institutional transformation,
using institutions as basic categories for understanding and explaining social reality as well
as its reproduction and transformation. From our point of view, all these categories are
indeed embedded (Polanyi [1944] 2001) in culture and thus a dialogue with cultural studies—
more specifically, Mary Louise Pratt’s (1991) contact zones—seems appropriate in analyzing
institutions.
According to Pratt (1991), contact zones comprise the daily interactions in social
spaces where culture and class meet and negotiate with each other. Although quite often
negotiations happen in a context of asymmetrical relations, dominant groups can never
control the systems of meaning due to the heterogeneity and ambiguity inherent in
transculturation—i.e., “processes whereby members of subordinated or marginal groups select
and invent from material transmitted by a dominant or metropolitan culture” (Pratt 1999,
36). The ethnic and group consciousness thus provides subordinate peoples with some
discretion on what and how to absorb foreign ideas into their culture. Contact zones provide
culture and cultural resistance with stronger capability to affect institutional change than
double movement. As we discuss in the following section, this approach is consistent with
old institutionalist economics (OIE) in that it supports a nuanced view of market institutions
and culture, thus allowing for a broader understanding of the role and transformation of
institutions (Klimina 2016; Schneider and Nega 2016). It also shows that the causation
between economic development and institutional change is a two-way avenue that escapes
the faulty notions of extreme voluntarism, on one hand, and of culture climate fatalism, on
3
Although all societies are hybrids—that is, there is no pure example of a market society—the degrees of
mixture vary across societies, representing several possible ways of historical change and unfolding (Hodgson
2001).
618 Natalia Bracarense and Karol Gil-Vasquez
the other (Chang 2011). By combining old institutional economics and cultural studies, we
intend to contribute to an understanding of social transformation that takes place historically
in a non-teleological way, as proposed by Thorstein Veblen (Hodgson 2001).
Our contribution consists of incorporating the concept of contact zones into the
economic debate in order to understand the multilayered set of institutional factors involved
in the process of transforming Bolivia. We argue that, despite all the existing contradictions
in Morales’ terms, Bolivia’s mixing of Andean principles with market institutions in a process
of re-embedding its economy goes beyond a process of double movement. The established
resistance has set off some long lasting changes. Among these are (i) the impact of political
reforms on the municipal, departmental, indigenous, and regional autonomy which upholds
the inclusion of all Bolivians in the political system; (ii) the inclusion of Andean ontology
in the constitution which empowers Bolivia’s indigenous majority and restitutes their self-
determination, shifting the power away from the Europeanized elites; and (iii) the presence
of the same ontology in Bolivia’s relations with neighboring nation-states which expresses
national autonomy from outside influence.
Our analysis sheds light on a non-teleological historical evolution rather than reaffirming
the inevitability of market pervasiveness, and it may offer an alternative to overly deterministic
development models. In the next two sections, we describe the theoretical approach we use in
the article and study the case of Bolivia’s recent institutional changes, respectively. Focusing
in particular on the emergence of ethnic class consciousness as it connects to the notion of
El Buen Vivir, we discuss how Bolivia’s institutional transformation emerges from the daily
interactions in social spaces where culture and class meet and negotiate with each other.

A Theoretical Approach: A Contact Zones Analysis from an Institutionalist

Perspective

As Geoffrey Schneider and Berhanu Nega (2016) observe, the discussion on economic
development has been shifting toward a concern about institutions, which marks the
emergence of new institutional economics (NIE) as a new consensus in development theory
and policy (Tamanaha 2015). Such shift has prompted responses from old institutional
economists (Chang 2011; Schneider and Nega 2016), who propose a view of development
that fully grasps the importance, nature, and embeddedness of institutions and their
transformation. Embeddedness implies that economic agency cannot be reduced to the
pursuit of subjective utility, but rather reflects the need and desire for a system of institutions
that embodies cultural values. Transformation is a result of the interaction between agency
and structure and thus it is a complex process. In other words, the economy is embedded
in culture and institutions need to be understood as both processes and structures (Mayhew
1990; Waller 1988). Such a complex understanding of the economy and its transformation
 Bolivia’s Institutional Transformation 619
stops the analysis from succumbing to both extreme voluntarism (i.e., implying that
institutions are easily changed) and extreme fatalism (i.e., asserting that institutional change
is unattainable due to cultural and historical factors) (Chang 2011).
One of OIE’s strengths is its ability to guide the promotion of equality in diversity
(Shiva 1994) due, for instance, to the belief it fosters that institutions embedded in non-
western cultures are capable of providing equal (and perhaps even better) conditions of life
as those embedded in western cultures. Such a belief may empower societies to define their
own form of buen vivir (Acosta 2010; Escobar 2009) that does not necessarily focus on
growth, productivity, competitiveness, and markets to measure development (Shiva 1994).
For example, in a study about Sub-Saharan Africa, Schneider and Negu (2016, 437) show
that in Kenya, Senegal, and Gambia, among other countries, efforts to apply a one-size-fits-
all model through the establishment of secure property rights to land has undermined the
wellbeing and productivity of many people. Meanwhile, Anna Klimina (2016) conducts a
careful study on Russia’s history and institutional settings to counter a fatalist approach to
institutional economics. In a similar endeavor, we aim to emphasize the influence of culture
on institutions in Bolivia through the combination of Pratt’s contact zones and OIE, but
without endorsing cultural fatalism. We suggest that the strong Andean embeddedness of
Bolivia’s economy has taken the form of a contact zone, the materialization of which has
increased general wellbeing in that country.
Pratt’s contact zones “refer to places where cultures from disparate historical trajectories
come into contact with each other. They are often the result of invasion and violence, resulting
in social formations based on radical inequalities” (Pratt 1999, 40). Contact zones are “social
spaces where cultures meet, clash, and grapple with each other, often in contexts of highly
asymmetrical relations of power, such as colonialism, slavery, or their aftermaths as they are
lived out in many parts of the world today” (Pratt 1991, 34). In undertaking her work, Pratt
analyzes travelers’ journals and personal letters to argue that cultural interactions between
European travelers and their Latin American and African hosts prompted daily negotiations
between these different groups. Her analysis of these negotiations reveals the power realities
of everyday life and those associated with geopolitical and economic structures.
By observing the western institutional imposition on other cultures and the other
cultures’ reactions, Pratt helps us understand the multilayered set of institutions that
constitute society. It is in the peripheral world that contact zones flourish, creating a highly
hybrid economy, where the attempts of capitalism to insert itself are met by a plurality of
interpretations and different systems of meanings. Pratt states that, while westerners see
culture as something people develops after they reach a certain level of subsistence,4 the
4
Karl Polanyi (1957) would call this a formal meaning of the economy, i.e., an understanding of the
economy as something disconnected from culture.
620 Natalia Bracarense and Karol Gil-Vasquez
opposition between culture and subsistence makes little sense to other peoples. Culture—
as language, religion, cosmology, everyday life, ethics of production and consumption, and
the relationship with land, space and animals, among other things—means survival.5Pratt
endorses the idea of embeddedness as “the fundamental need of people to be sustained
by social relations of mutual respect” (Polanyi-Levitt 2006, 391). Many authors in the OIE
tradition can serve as examples of this multifaceted view. According to Veblen ([1899] 1970),
for example, habits and customs are often present in human reasoning and intellect. Philip
O’Hara (2002, 83) further explains that “instincts provide the potentiality for human beings
to engage in social action; social habits structure the thinking and behavior of individuals;
and institutions are those social patterns of regularity that establish a set of clustered norms
and mores often within an organizational setting such as a firm or a family or the community.”
The hegemonic character of the workplace under capitalism, given that it provides
workers with the means of subsistence (wages), is filled with interpersonal experiences that
occupy other spheres or necessary impurities, such as well-established and specific cultural
practices, channels for developing valuable and long-lasting social networks, and community-
driven activities that are not informed by consumption (Veblen [1914] 1970). This view
expresses one of Veblen’s criticisms of Karl Marx regarding the absence of cultural influences
in reasoning and their implications for the development of the system—the possibility of
several synchronic societal formations (Hodgson 2001, 69). There are always necessary
impurities as no system can function solely on economic institutions (Hodgson 2001, 65).
The habitual system of meaning tends to be more prevalent in societies that have experienced
an institutional imposition in the form of cultural values and/or political and economic
systems (i.e., colonial and post-colonial social settings). That is, it is important to look at
economies through historically grounded concepts in order to understand their varying level
of embeddedness.
Although with the expansion of capitalism, economic factors capture a variety of
institutions—particularly the system of production and the access to the provisioning process—
as long as the economy is embedded, non-market institutions will influence the unfolding
and functioning of the economy. The manifestation of embeddedness varies across different
societies and displays philosophical and cultural factors that may not coincide with a capitalist
way of thinking and living. The awareness created through such analysis is especially relevant
in the peripheral world, where the strong coexistence of different economic systems means
that contact zones abound.
Neglecting the plurality and power of all possible manifestations of embeddedness
follows the superimposition of “the roles and forms of power of western male-oriented concepts

5
The understanding that economic survival depends on cultural norms requires a theory that encompasses
a substantive meaning of the economy (Polanyi 1957).
 Bolivia’s Institutional Transformation 621
on women, all non-western peoples, and even on nature, rendering all three ‘deficient,’ and
in need of ‘development’” (Shiva 1994, 246). Moreover, it celebrates the positive outcomes
of industrialization, while downplaying its historical failures and side effects, both of which
are considered mere deviations of the ideal type. Taking the western world as the ideal—that
is, the end of history—deviations from that ideal—namely, non-western cultures—are seen as
suboptimal, and they either need to change or are branded irreversibly inferior. From the
idealization of the western world, a bias toward homogenization and extreme voluntarism
emerges, together with an agenda to accomplish such uniformity through the prevalence of
market institutions over their social, cultural, and political surroundings. Alternatively, when
a society fails to change, the same assumptions reverberate as cultural racism.
Understanding the intersection of culture, power, and the economy is important in
order to avoid these biases. An awareness of that intersection raises new questions about the
relationship between agents-structures and foreign-domestic encounters. This brings forth
the need to reconceptualize these relationships of power by analyzing the others’ (Said 1979)
perceptions of their “uplifting” processes. While recognizing the importance of economic
and structural factors in affecting history, agency needs to be brought to life in order to show
that everyday life, inherent habits, culture, and customs prompt such agency to transform,
accept, and react to structural changes. What has been lacking in this process is a framework
for understanding the grassroots dynamics and meanings of the Latin American reality
(Joseph 2008, 19).
It is in recognition of these challenges that we study the case of Bolivia, focusing on a
specific contact zone: the “ethnic class consciousness” that has transformed Bolivia’s civic
society in the past few decades. This consciousness, which originally connected “workers” or
“proletarian” organizations with an “ancient” (or Andean) world, materialized in the form of
reforms of political and economic institutions in contemporary Bolivia. In fact, “traditional”
Andean culture has significantly influenced economic institutions in the country like public
policy, for instance, which currently embraces the principles of el Buen Vivir/bien vivir or
sumaj qamaña/sumak kawsay regarding the social provisioning process. Based on a literal
translation, Rolando Mamani-Pacasi et al. (2011) define the Aymara and Quechua’s terms
as “richness of life,” “to know how to live a life,” “having a good attitude,” “having a full
heart,” or even accomplishing a “dignified death,”6 respectively. In 2008, the concept of
sumaj qamaña was included in Bolivia’s constitution via Article 8, asserting that “the state will
assume and promote the ethical and moral principles of a plural society: ama qhilla, ama llulla,
ama suwa (do not be lazy, do not lie and, do not steal), sumaj qamaña, ñandereco (harmonious
life), teko kavi (good life), ivi maraei (earth without evil) and qhapaj nan (principles-moral)”

6
For more interpretations of the meaning of sumaj quamaña vide, see Xavier Albo (2009), Maria Elisa
Duran-Lopez (2010), and Javier Medina (2011).
622 Natalia Bracarense and Karol Gil-Vasquez
(EPB 2008). Thus, Bolivia has ideologically departed from the market liberalization model
and has welcomed an Andean ontology in forming a set of values, upon which economic
activities can be consolidated.
Based on this alternative conceptualization of what a society’s goal should be, sumaj
qamaña is equated with a harmonious state between material and spiritual components
that incorporate both members of the community and the natural environment. From this
perspective, wellbeing is a social and ecosystemic phenomenon rather than what resides
in the realm of the individual. According to Pablo Dávalos (2011), sumak kawsay/sumaj
qamaña incorporates a dynamic critique of modernity from the perspective of radical
otherness that identifies the instruments of domination created by the structures of colonial
power. A non-teleological understanding of history opens the possibility to visualize this
process of transformation in Bolivia not only as another form of embeddedness, but also
as a contact zone that can transform the lives of the majority of Bolivians. In our effort to
discuss how Bolivia’s institutional transformation emerges from daily interactions in social
spaces where culture and class meet and negotiate with each other, we focus on the history
of Bolivia’s labor and social movements, including the recent responses to Evo Morales’s
economic policies.

From the TINA Neoliberal Policies to Sumaj Qamana: From the Republic of Bolivia
to the Plurinational State of Bolivia

Through an appraisal of Bolivian history, we aim to illustrate the constant overlapping of

economic systems with different systems of meaning that equip Bolivia with the cultural
material to produce effective resistance to the dis-embedding forces of contemporary global
capitalism. Bolivia has undergone a series of political conflicts, with the populace pushing
to break the cycle of poverty, inequality, and injustice, which they perceive as an imposition
of foreign interest. Evo Morales’s recent departure from the ideals of El Buen Vivir and
the popular reaction to his more moderate political attitude represent the latest display of
the counteracting forces in place. Despite the swaying of contradictory forces, the study of
Bolivia’s history illustrates the development of a ethic class consciousness that translates into
deeper institutional changes than a process of double movement would permit. That is, we
present the history of contact zones between Bolivian and western values, their embodiment
as an ethnic class consciousness, and their long-lasting impact on Bolivia’s institutional
setting.
During the colonial era, the region that now constitutes the plurinational state of
Bolivia was subjected to extractive and predatory institutions,7 the long-lasting impact of
7
The scenario of despair is accurately described by Eduardo Galeano ([1971] 1997), who shows how the
natural riches of Potosi were pillaged, causing indigenous death and poverty in his seminal contribution, The Open
Veins of Latin America: Five Centuries of the Pillage of a Continent.
 Bolivia’s Institutional Transformation 623
which shaped the state and the provisioning process for over a century after the country’s
independence in 1809. Rather than reclaiming political and economic self-determination
through a process of dis-embeddedness (i.e., strengthening property rights and demanding a
less interventionist state), Bolivians have consciously resisted western influence, embedding
these institutions in Andean culture instead. Culture thus enters our analysis not with
fatalism, but rather as providing Bolivians with an agency in determining their institutional
settings.
Part of the system of meaning observed in Bolivia is reminiscent of colonial times.
During colonialism, Aymaras, Yukas, and Quechuas, among others groups, were baptized
and taught to despise their own culture, which the Spaniards considered to be barbaric.
This system created a racial hierarchy in which the indio (Indian) was viewed as lesser than
the mestizo, the cholo, and the gringo (Reinaga [1970] 2000, 143). This was a caste system that
marginalized the indio. To combat this oppression, an alternative paradigm was necessary for
those who had to face the complicated world left by the Spaniards. The so-called indio could
not accept the historical accounts, tinted by the religious bigotry of foreign practitioners and
the prejudices of the colonizers. Alternatively, they developed “mythic” stories to reconcile
what happened in their history with an understanding of what “ought to have happened”
(Hill 1988).
Such myths created a different system of meanings, through which Bolivians rejected
the role of victims and felt empowered. For instance, the Aymara, Tupac Katari, and his wife,
Bartolina Sisa, took court and sieged La Paz in 1781. Despite the limitations faced by Katari
and Sisa, they raised an army of over 40,000 militants that temporarily defied the Spanish
Empire’s hegemony (Forrest 2007). Tortured and finally quartered by the conquistadores,
Katari is still remembered as a hero who vindicated Andean pride. Two centuries later,
Aymaras continue to propagate the myth about Katari’s assassination. They believe that his
spirit has returned to fulfill his promise: namely, to reemerge as thousands of souls in order to
resist oppression. Through such myths, indigenous meanings and interpretations converged
into a collective memory, embedded in economic institutions, upon which Bolivians have
built a resistance to colonialism and, more recently, to neoliberalism. This embeddedness has
expanded class consciousness to include the liberation of “the other” and spur the creation
of a contact zone: an ethnic class consciousness.
Instances of clear connection between class and ethnic consciousness are provided by
June Nash’s (1997) anthropological study of Bolivian miners’ militant unions. Strengthening
the legacy of non-exclusivity between ethnic and class awareness, the miners’ unions
developed a very unique culture of resistance—a culture that embraced the Andean legacy
as their basis. The miners’ class consciousness stemmed not only from the awareness of
the alienating forces of capitalism, but more importantly from distancing themselves from
624 Natalia Bracarense and Karol Gil-Vasquez
it, at least psychologically (Nash 1997). That is, miners redefined their sense of self-worth
by measuring it against their sacrifices and reciprocal practices among themselves and with
the pacha (nature), rather than in the context of the wage they earned. Miners detached
themselves from their monetary gains as a way to decommodify their labor power and to
recast their earnings as the devil’s pledge (el Tio). Within this context, they determined to
quickly spend their income on necessary goods and, more importantly, on communal rituals
and feasts to satiate el Tio’s thirst for miners’ lives.8 In this “imagined” world, miners also
rejected the principle of private property by mystifying the owners of the means of production
and imagining them as el Tio due to their absentee ownership and distant imposition of
hardship.
Bolivia’s tin miners have discerned an opportunity to ideologically resist capitalism
through Andean spiritual practices. That is, miners have performed as indigenized
proletariats who have fetishized the economic activity they participate in by uplifting their
reality through spiritual rituals connecting them with nature. Thus, although physically
exploited, they are mentally far from being alienated as they transport themselves into the
world of otherness—i.e., into the world of rituals, festivities, and cultural practices. Based on
the Andean cosmology, this process emphasizes the interaction between human beings and
the Pachamama (Mother Nature) through the production process, and the achichillas (the
spirits of the dead) are identified as the real owners of the pits and the precious metals. The
exchange with the Pachamama and the respect for the achichillas are long-standing and they
ensure the community’s harmony.
The miners create an alternative interpretation of their condition, effectively
transforming the “what ought to be” of an exploitative system of production into a “what
ought to mean” of mining extraction within the Andean cultural context. Through forming
meaning, miners are able to endure alienation and reappropriate their instinct of workmanship
by interpreting mining as an exchange with the Pachamama that, in return, guarantees their
safety, productivity, and wellbeing. Consequently, through their idea of a temporary sacrifice,
miners maintain traces of Andean meanings alongside capitalist institutions, creating a
communal space within the mines and adopting the principle of reciprocity. Such interplay of
meanings generates a hybrid economy that reproduces economic exploitation, on one hand,
and creates space for change, on the other, by empowering the workers and situating them
away from a sense of despair and purposelessness. Admittedly, psychological adjustments to
the indignities of waged labor do not automatically translate into institutional change. In the
remainder of this section, we argue that, in the case of Bolivia, ethnic class consciousness did
8
According to Nash (1997, 144), their expenditures on candles, liquor, food, and incense are part of a
reciprocal exchange with deities, whose expected response is the protection of miners from accidents. Michael
Taussig (1980, 192-198) adds that “[t]he old gods must be fed so as to starve off evil,” and rituals also serve to bind
the worker’s “propensities for production and destruction into a transcendent synthesis—a reciprocal affirmation
of reciprocity itself.”
 Bolivia’s Institutional Transformation 625
earn tangibility through its bottom-up impact on public policy.
According to Álvaro García-Linera (2015), for Bolivian workers, syndicates—particularly
the mining and textile industries—were the avatars of collective existence. From the 1940s to
the late 1980s, syndicates provided a source of class identity. Moreover, they functioned as a
network of support, friendship, and continuous solidarity, providing numerous opportunities
to those rural migrants who left behind the ayllu—the Andean traditional community—to
reproduce personal experience and interaction within a familiar cultural setting. Faced with
the “commodification” process of their labor, rural migrants found a level of protection
and resistance in the unions, under a discourse of tolerance and rebellion that resonated
with their rooted agrarian memory. Consequently, syndicates served as links between
capitalist structures, which were expanding across rural Bolivia, and the ayllu. In other
words, syndicates provided space for a potential contact zone between Bolivia’s indigenous
countryside and capitalist structures: ethnic class consciousness.
The 1952 Agrarian Revolution—a historical moment during which the miners and the
rural population demanded the reappropriation of an indigenous identity, while imposing
limits to the economic power of the landowners—achieved the nationalization of the largest
tin mines, land reform, universal suffrage, and a reconstituted “revolutionary” military
(Lehman 2016, 9). Such successes notwithstanding, it failed to achieve the much desired
national autonomy and indigenous inclusion. According to Emir Sader (2011), one of the
lessons from the 1952 revolution was that Bolivia’s indigenous cultural and social context
should not be underestimated. During the revolution, indigenous groups were induced to
adopt the role of peasants—the subordinate allies of the militant miners—having to forget
their ancient origins. The focus on class conflict meant that the Aymara, Quechua, and
Guarani lost their identities in this process.
Despite the successes and failures, the revolution provided a fertile ground for future
social movements. It was followed by episodes of popular resistance and sophisticated
working-class politics during the period of military dictatorship (1964–1982). During the
1980s process of economic liberalization, however, the workers organizations and syndicates,
which had previously been incentivized by Bolivia’s developmentalist state, became dispersed.
Following the 1980s structural adjustment, a predator state a la Gailbraith emerged. It soon
turned into a powerful block, made up of business fractions related to the political parties, the
world market, and foreign capital. This block leveraged great influence over designing public
policy in an environment of already severely weakened worker and peasant representation
(García-Linera 2015).
By 2002, Bolivia had become a “showcase of the Washington Consensus orthodoxy:
democracy seemed well-established, inflation was low, growth was solid—if unspectacular,
and drug production was down” (Lehman 2016, 16). Interestingly, the neoliberal model
626 Natalia Bracarense and Karol Gil-Vasquez
did not reduce political and social contradictions and unrest, and the twenty years of
its implementation led to a severe deterioration of living conditions for most Bolivians.
According to data published by the World Bank, Bolivia became one of the poorest and
most unequal countries in Latin America. The population living in extreme poverty was
8.57 percent in 1990 and ten years later that number had more than tripled, reaching 29.67
percent. Meanwhile, the Gini coefficient went from 42.0 in 1990 to a staggering 63.0 in
2000 (World Bank 2016).9 While the two-decade-long neoliberal push for disembeddedness
weakened syndicates, it also prompted a double movement to reestablish national militant
unions and build new indigenous organizations. The combination of unions and new
social movements against the structural adjustment policies took several forms and its long-
lasting consequences have come to characterize contact zones that go beyond a mere double
movement.
For instance, after the tin mines were closed down in the 1980s, the miners’ movement
migrated to the Chapare (rural province in the northern region of Cochabamba Department
in Bolivia), partially because many of the laid off workers moved to that region to work as
coca-leaf farmers. At the time, the cocaleros defied the U.S. War on Drugs based on their
rights not only to subsistence, but also to the legal production of an important element
of their ancestral heritage as well as a symbol of their cultural tradition—the coca leaf.
Thus, the cocaleros became one of the protagonists that transformed Bolivia’s grassroots
movements into an actual agenda for radical political and economic change. The awareness
of their economic situation and reappropriation of cultural identity spurred a new type of
mobilization in the country: an “ethnic-cultural-political-economic” struggle. In fact, the U.S.
War on Drugs was not successful in the region mainly because it failed to understand “the
substantial diversity of individuals and the multiplicity of interests involved in the Bolivian
drug trade” (Malamud-Goti 1990, 36).
Another example of Bolivians’ resistance to “there-is-no-alternative” (TINA) policies was
the Cochabamba Water War in 2000. It was a protest against the privatization of the city’s
municipal water supply company, Semapa by Aguas del Tunari, a joint venture involving the
multinational corporation Group Betchel. In response to a significant increase in the price
of water, a wave of demonstrations erupted whereby thousands of people marched to the city
center in protest. The Cochabambina Departmental Federation of Irrigators (FEDECOR)—
an organization composed by local professionals, including engineers, environmentalists—

9
Ideally, we would be able to analyze the progression of the data from the 1970s onward, but unfortunately
there is no data available for these two variables before 1990. It is nonetheless clear that there was deepening of
poverty and inequality in Bolivia in the 1990s.
 Bolivia’s Institutional Transformation 627
the Center of Bolivian Workers (COB), and the Coordinadora de Juntas Vecinales—a
10

grassroots social organization—joined forces to successfully reverse the privatization process.

After the water crisis, in an event known as the Gas War, Bolivians made a second
attempt to prevent the government from handing over control of the country’s natural
resources to foreign investors.11 Despite state repression, armed with traditional Aymaran
slingshots and guns left over from the 1952 Agrarian Revolution, Aymaran communities
surrounded La Paz and isolated the capital from the rest of the country, causing severe fuel
and food shortage. The COB, allied with other indigenous groups, forced the resignation of
President Gonzalo Sanchez de Lozada and the enactment of a new hydrocarbons law. Their
demands were joined by a strong and radical front led by the cocaleros union’s leader, Evo
Morales, as well as by the former leader of the Tupac Katari Guerrilla Army and the United
Confederation of Bolivia’s Workers and Peasants (CSUTCB)’s general secretary, Felipe
Quispe. Together they called for the nationalization of Bolivia’s hydrocarbon resources and
the involvement of Aymaras and Quechuas in the country’s political life.
Ancient Andean practices clearly stood as a foundation for these social movements
through symbolic, technical, and psychological support. In the case of the 2000 Water
War, La Coordinadora bridged the discontent of the urban middle-class sectors and the
rural indigenous majority, who were ready to resist attacks on their land and defend their
communities. Similarly in El Alto, a city inhabited largely by rural indigenous immigrants,
protesters utilized the effective organization of the ayllu to maintain a structural capacity
at the neighborhood (barrio) level that could handle state repression and maintain a
continuous political anti-neoliberal discourse. According to Mamani-Pacasi et al. (2012), the
ayllu represents a micro-government that resembles “indigenous barracks.” During El Alto’s
uprising, dwellers articulated a complex set of collective practices to confront the systematic
violence of the state. Every barrio constituted its own territory, each neighborhood built its
own government, and each government made its own political decisions.
These examples demonstrate the power of the ethnic class consciousness. For an
indigenous majority, the indigenous reinterpretation of “what ought to be” as the ultimate
purpose of a political process has created a collective memory. This memory connects
the Quechuas and Aymaras’ experience of oppression at the workplace with the colonial
legacy of racism in Bolivia. It is from this memory that Katarismo has developed since the

10
Founded in 1952, after the national revolution that brought the Revolutionary Nationalist Movement
to power, the Center of Bolivian Workers (COB) is the chief trade union federation of Bolivia today. It is strongly
affiliated with the Union Federation of Bolivian Miners (FSTMB) and represents about two million people,
bringing together workers from various branches of industry and public services, peasants, and indigenous leaders.
11
In early 2002, the Gas War started as an insurrection of Bolivia’s indigenous majority, who accused
Sanchez de Lozada of pandering to the United States and failing to improve the majority’s living standards.
Government’s repression ensued, to which the COB responded by calling for a general strike that paralyzed the
country.
628 Natalia Bracarense and Karol Gil-Vasquez
1970s, creating the connection between the Indian liberating process and their political
representation. Kataristas have worked on expanding the repertoire of collective memory
by politicizing groups of “indigenous” people who shared some cultural traits and many
memories. Consequently, for the indigenous population of Bolivia to become Indians, they
had to first reject the construction of a post-colonial world. In doing so, they have identified
their existence with that of Tupac Katari, a now mythical figure. The revived Indian identity
merged with ethnic class consciousness that has defined the political and economic struggles
of Bolivia’s indigenous peoples in the past, and it will continue to do so into the future
(Sanjines 2004).
These “ethnic-cultural-political-economic” struggles emerged on a psychological level
and transformed into political reforms with the presidential inauguration of Evo Morales,
who fully embraced Katarismo and became the first self-identified indigenous president in
Bolivia’s history. Since his election, Bolivia has gone through institutional transformations
that represent alternatives to the IMF and World Bank’s adjustment programs prescribed
for the Global South. As the cocaleros struggle shows, Bolivia’s alternative to market
liberalization is based on the concept of otherness. It embraces the Andean idea of communal
wellbeing rather than focusing on the individual. According to Salvador Schavelzon (2015),
the political and institutional transformation linked to El Buen Vivir refers to a pluralist
model of democracy. In terms of political reform, the Law of Popular Participation was
implemented in 2008 and it initiated a process of plural representation and autonomy.
In fact, the new constitution envisioned a complex interplay of four levels of autonomy—
municipal, departmental, indigenous, and regional—institutionalizing the legitimacy of the
ayllu and empowering direct and community-based political processes. With regard to the
economic institutional transformation, sumaj qamaña became the benchmark of assessing
the country’s social provisioning process. Based on Article 307 of the constitution, “the
Bolivian economic model is plural and is oriented toward improving the quality of life and
the wellbeing of all Bolivian citizens” (EPB 2008). The concept itself represents a hybrid space
where state and community mix, with the community needing state presence to guarantee
respect for economic, social, and political diversity.
In sum, when structural changes meet agency, the outcome is unknown. As a reaction
to the oppressive context of the 1980s market liberalization, Bolivia’s social movements
were able to redesign some public policies, enact significant legal frameworks and dismantle
others, and modify patterns of income distribution. All of these signs shed light on what can
be considered an organized institutional transformation, primarily accomplished by extra-
parliamentary methods. According to García-Linera:
[T]he importance of these emerging political forces is the characteristics
of their internal composition (plebeian and Indian) and their agglutinated
 Bolivia’s Institutional Transformation 629
demands. These movements mainly represent the social blocks that have
been historically excluded from the country’s political decision-making
process. At the moment that they look for political representation, these
blocks aim to substantially modify economic relations. … Today, the social
movements that have the greatest interpolating power on the political order
are made out of [Bolivia’s] Indian social base. They have emerged from
agrarian regions, those marginalized from the economic modernization
boosted by the [neoliberal] state. (García-Linera 2015, 429-430)

Based on a civil society driven by workers and indigenous grassroots movements,

Bolivia became a country that moved away from the westernized political model of
representative democracy and embraced pluralism, reciprocity, and wellbeing—all alternative
models of provisioning and political organization (Lazar 2008). As a result, Bolivia became a
representation of one of the few countries in the region that embraced its ethnic and cultural
diversity. The plurinational state of Bolivia, in a way, relinquished the “nation-building”
project based on mestizaje or cholaje by clearly identifying the inherent prejudices of colonial
and republican societies of Latin America (Canessa 2006, 2007; Grace Miller 2004).
Morales’s first presidential campaign was launched on the premise of indigenous rights
and environmental protection. Based on this platform, Morales rapidly distanced Bolivia
from the influence of the IMF, the World Bank, and other development organizations and,
“[d]uring his first six months as president, he had passed the hydrocarbons nationalization
decree, [and] released an outline for agrarian reform” (Sivak 2010, 7). In a short period of
time, he began “the process of de-Americanizing Bolivia after more than half a century of
dependence on the United States, … and settled the election of delegates to the Constituent
Assembly by which means he proposed to refound the country” (Sivak 2010, 7). During his
third term, Morales clearly pursued the redevelopment of social policies, altering existing
transfer programs and implementing new ones, with three large distinct cash transfer
programs now in effect—Bono Juancito Pinto, Renta Dignidad, and Bono Madre-Niño (Tsolakis
2010, 272).
It is important to observe that the institutional impact of indigenous practices is
not confined to Bolivia’s domestic economy. After the political emergence of indigenous
movements, Bolivia—together with Venezuela and Ecuador—joined Cuba in the pursuit
of decommodifying trade relations, increasing the number of exchange transactions that
were based on solidarity and complementary capacities, rather than market prices. These
principles were extended, via the Bolivarian Alliance for the Peoples of our America (ALBA),
to countries with much less ability to contribute to others, such as Nicaragua, the Dominican
Republic, Ecuador, and Haiti. In this system of exchange, each country contributed according
to its capacities and received what it needed (Sader 2011, 134-135).
Jonas Wolff’s (2016) analysis of the Framework Agreement between the US and Bolivia
630 Natalia Bracarense and Karol Gil-Vasquez
reinforces the perception of a far-reaching influence of indigenous social value. Wolff argues
that Bolivia sustains a growing sense “that the West, its liberal assumptions that allow
powerful elites to capture the bulk of the benefits, and its unsustainable demands on the
Pachamama, provide no attractive or even viable pathway to the future” (cited in Lehman
2016, 26). Interviews with members of the Quechua and Aymara communities demonstrate
the popular support for such an antagonism to “modernization” and the desire to maintain
the Andean legacy of harmony with the cosmos, nature, and community (Tejerina 2010).
Bolivia’s institutional transformation, however, is not free of contradictory forces and
asymmetrically powered interactions. According to Ricardo Molero-Simarro and Maria Jose
Paz-Antolin (2012), contradicting his 2005 political and environmental campaign, Morales’s
economic policy is characterized by an intensification of the extractive model, which has
only produced national benefits due to a temporary increase in commodity prices. In other
words, Bolivia may have achieved some autonomy from foreign interests, but it has not
eliminated its dependence on foreign demand after Morales took power. By 2008, exports
represented more than one third of Bolivia’s gross domestic product. The heavy reliance on
the extraction of raw materials is an expression of the current permeability of the economic
system. Although Morales aims at emphasizing Bolivians’ traditions, he is constrained by
ideas of economic performance. Based on those ideas of economic performance, the country
is doing well since Bolivia’s GDP per capita had grown by an average of 11.1 percent per year
between 2005 and 2014. These figures represent considerable growth even before comparing
them to the average yearly decrease of 0.6 percent between 2000 and 2004 (World Bank
2016). Moreover, inflation has remained stable since the beginning of the millennium, while
the terms of trade have become increasingly favorable for the country (Hicks and White
2015).
More importantly, when regarding variables related to wellbeing, the country shows
improvement across the board. For example, the Human Development Index went from
0.62 in 2000 to 0.675 in 2012. Bolivia’s World Happiness Index has also experienced gradual
increases since the 2007–2009 report. In 2014–2016, Bolivia ranked 58 out of 157 countries
with an index of 5.823—a score that exceeds those of Portugal and Greece as well as Slovenia
and Croatia—a value reportedly explained by the perceived existence of social support.
Regarding changes in happiness from 2005–2007 to 2014–2016, Bolivia has experienced
a 0.323-point increase in its self-perceived happiness, despite the 2008 global economic
crisis that put Portugal, Greece, and the United States among the countries with the most
severe loss of happiness in the past ten years (World Happiness Report 2017). Still, the above
average wellbeing index, together with the average life expectancy and ecological footprint,
is not enough to counterbalance the negative impact of inequality on the country’s Happy
Planet Index of 23.3 compared to the world average of 26.4.
 Bolivia’s Institutional Transformation 631
Nonetheless, inequality in Bolivia has decreased as the Gini coefficient went from 63.0
in 2000 to 48.5 in 2014. In effect, when comparing 2005 to 2011, all quintiles increased their
share of the national income, except for the richest 20 percent, who went from earning 61.8
percent of the national income in 2005 to 50.7 percent in 2011 (World Bank 2016). Starting
in 2007, the level of extreme poverty had consistently decreased to reach 6.81 percent in
2014. This reduction in inequality had benefited indigenous populations the most as they
received a disproportionate increase in income.
The continuation of this upward spiral is far from stable. With gas revenues in sharp
decline and Bolivia’s ally Venezuela in turmoil, the national economy is slowing and
opposition to Morales’s continuismo is building up. The government seems to have difficulties
in continuing an alternative model for economic change and the president’s inability to
relinquish some of his political power has threatened to reset the direction of Bolivia’s
countervailing forces. Clear instances of these difficulties are the controversial construction
of a highway through the native communal land of TIPNIS, the mining project in CoroCoro,
and the hydroelectric plant construction on the Madera River. These policies follow the
dominant development paradigm, oriented toward industrialization and growth and are
perceived as surrendering to western notions of progress. Morales’s handling of TIPNIS
cost him a loss of popularity among his most ardent supporters, who have highlighted his
departure from El Buen Vivir and his demonstrated disrespect to Pachamama. Thus, once
again, the voices of dissent that initially elevated Morales to the status of president, are now
demanding that he does not run for office in 2020.
The present situation is a clear instance of the contentious interaction between the
developmentalist approaches of leftist governments like el Movimiento al Socialismo-Instrumento
Político por la Soberanía de los Pueblos (MAS) and the proposals made by the indigenous base.
While MAS reconsiders the industrializing route as a strategy to generate economic growth,
indigenous organizations are primarily concerned with the impact of such a strategy on the
holistic existence of humanity, standing in strong opposition to deforestation, desertification,
and depredation embedded in the growth model (Schavelzon 2015). Similar contradictions
are observed in Peru by researchers like Unai Villalba (2013) and Sarah Radcliffe (2012), who
question the capacity of El Buen Vivir to emerge as an alternative to neoliberalism. Villalba
and Radcliffe’s doubts rely on their belief that the two structures are more likely to coexist
than become mutually exclusive.
From our perspective, these seeming contradictions in the process of institutional
transformation are inherent in non-teleological processes and imply that no one can predict
the direction that changes will take. The direction, however, is influenced by the types
of institutions that are established and supported through the process of transformation
(Villalba 2013). While we do not dismiss the possibility of this process to unintentionally
632 Natalia Bracarense and Karol Gil-Vasquez
accommodate the interests of global capitalism, one must remember that Bolivia’s potential
seems ample as it has thus far incorporated voices of dissent, including (to an extent) their
interests into the government’s agenda. Yet, how far these voices will reverberate remains
unknown. So far, to echo James Dunkerley (1984), we argue that the contact zones created by
the process of empowerment and inclusion of Bolivian grassroots movements into capitalist
institutions have spurred a radical institutional transformation, greater autonomy from
foreign interest, and better economic conditions for the country’s population.
The contact-zone idea, which is of central interest to us here, relies on collective memory.
Thus, our analysis has focused on collective memory from colonial times to the present,
whereby this concept has morphed into an ethnic class consciousness manifesting itself in
political reforms. Through these encounters, Bolivians transformed into “Indians”12—that is,
they reclaimed their agency based on the concept of otherness and became political subjects.
Bolivians developed a sense of belonging through a set of interpretations that have created
contact zones between capitalist and indigenous institutions, connecting Bolivians to a non-
capitalist world.

Concluding Remarks

The discourse of El Buen Vivir, with its collective Andean memory, represents a contact
zone. It is the contradictory bridge between the concept of otherness and the forces of
modernization, as the current conflict in Morales’s presidential terms shows. Regardless of its
contradictions, Bolivia’s recent popular movements, fed by a well-established culture of social
mobilization, represent contact zones where indigenous systems of meaning interact with
structures of capitalism and shape the way history unfolds. These spaces represent interfaces
where historical sequences coexist synchronically and agency is regenerated. According to
Richard Stahler-Scholk, Harry E. Vanden, and Glen D. Kuecker (2007), Bolivia supports
many of the “new” Latin American social movements. In these processes, Bolivia’s social
organizations have redefined the meaning of citizenship, democracy, and civic participation
based on ancient and pre-Hispanic ideological structures.
It is clear that the contact zones between capitalist structures and Andean culture have
allowed Bolivians to build institutions that resist the influence of global capitalism and offer
an alternative vision of economic life based on Andean cultural memory. Our historically
grounded analysis avoids both extreme fatalism and voluntarism, and views Bolivia’s
transformation as an open-ended development rather than a process of embeddedness that

12
In fact, the effort to construct a national identity in Bolivia (and in other Latin American countries)
implied a reinterpretation and reproduction of the “Indianized” version of the colonizers, a discourse reproduced
by mainstream historical and economic accounts. As Guillermo Bonfil-Batallas ([1996] 2012) states, the label
“indigenous” has been pejoratively placed on the most disadvantaged strata of post-colonial societies, which are
unsurprisingly comprised of people sharing an indigenous ancestry.
 Bolivia’s Institutional Transformation 633
furthers the workings of the market system.
Existing research analyzes how the interplay of relations of production and indigenous
practices influence workers’ attitudes toward their living and working conditions in other
countries (Bonfin-Batallas [1996] 2012; Manosalvas 2014; Vilalba 2013). The workers’
interpretation of the world is influenced by the impact that one practice has over another,
which may either deter or facilitate a sense of class consciousness and ethnic identity. These
interpretations may also mitigate or aggravate the alienating nature of the production process.
The influence of cultural and intellectual practices on class consciousness, consequently,
cannot be downplayed. By examining this interaction in more detail, one may observe
that while ontological beliefs can ideologically support the market economy, they can also
nourish principles of reciprocity, solidarity, and community, thereby challenging capitalism’s
value system. Depending on the route chosen, history can unfold in different ways, meaning
that it is not teleological.
The interaction becomes a clear space of daily negotiations: instances of contact zones
that transform the meaning of the provisioning process and can reinvent institutional
settings. In contexts that facilitate their existence, ancient habits of thought can nurture
the “culture of resistance” that is required to successfully contest the impact of economic
exploitation of workers. Collective memory is part of this resilient process that liberates
the so-called indigenous populations from the various categories that marginalize them into
otherness.
In Bolivia, collective memory reconnects Quechuas and Aymaras—epistemologically
turned into peasants/Indians/workers—with their ancient roots. This world is present in
the workplace through spiritual practices as demonstrated by the case of Bolivian rural
migrants, who were repressed by the market economy and whose contemporary struggles
against the commodification of the coca leaf and the privatization of water and gas symbolize
the continuous existence of Andean meanings. Consequently, there is a constant interplay
between “traditional” and “modern” institutions that, in the case of Bolivia, has initiated a
cultural process which redefines its social provisioning process.
Eventually, ethnic consciousness and class struggles trigger a series of successful social
movements in Bolivia that have enhanced national autonomy, empowered indigenous
communities, and redefined the country’s position on an international scale. The ethnic
class consciousness potentially replaces the “developing” agenda and opens the door to an
alternative policy. Shared memories of the past have united and inspired contemporary
social activists in their battles. The “proletariatized” Aymaras and Quechuas embraced their
identity first as indigenous people and then as workers. Thus, reappropriating the racialized
category of “indigenous” under different institutional contexts has permitted Indians to
identify the exploitative system of production and to contest it. To turn myths into actual
634 Natalia Bracarense and Karol Gil-Vasquez
history, liberating oneself of preconceived notions may create conditions for a more inclusive
and ecologically sustainable future where both agents and structures play a role in the process
of social change.

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