El Salvador is becoming an economic success story in Central America, says Cato scholar Juan Carlos Hidalgo.

Since 1992, the country has undertaken an aggressive program of liberalization that has transformed its economy and yielded major improvements in various socioeconomic areas. In a new study, Hidalgo explains how El Salvador “is showing the rest of the region how economic freedom can pave the way for development and how globalization offers great opportunities for developing countries that are willing to implement a coherent set of mutually supportive market reforms.”

In today’s Cato Daily Podcast, Hidalgo explains how despite recent economic reforms, next week’s election in El Salvador could end with a government that has great admiration for the policies of Hugo Chavez that would turn El Salvador away from market-based reforms.

A third of the [voting] population is under thirty. So that means many young voters don’t remember El Salvador as it was during the early 1990’s… Young people have trouble paying for their cell phone bills, have trouble paying their gas bills and have trouble paying for tuition in colleges. What they don’t remember is fifteen years ago they didn’t have cars, their parents didn’t have cars, their parents didn’t have any cell phones and their parents lived in shanty towns.…

…Even though they talk about emulating the socialist revolution in Venezuela, they haven’t been explicit about dismantling democratic institutions in El Salvador.