The Consequences of CIA-Sponsored Regime Change in Latin America

Abstract

The CIA intervened regularly in Latin America politics during the Cold War, in some cases going as
far as bringing about regime change. While these interventions may have been considered successful from the US perspective, it is less clear what the economic and political consequences were for the citizens in the affected countries. We study the economic and political effects of CIA-sponsored regime change in Latin America and find that these actions caused moderate declines in real per capita income and large declines in democracy scores. Our findings should make any evaluation of US foreign policies regarding regime change more negative and support the idea that foreign political interference can cause real damage.

Keywords: Regime Change, Foreign Intervention, Economic Growth

JEL Classification: N16, H56, F5