Puerto Rico Economic Pulse ©

May 1999: Venezuela: Lessons to be Learned

Short Course Of Dos and Don`ts For Puerto Rico

To understand Venezuela`s crisis, it is useful to examine the economic programs that preceded it. With oil prices riding high in the mid-seventies and eighties, both government and consumers spent more than their income. Find out how inefficient subsidies interfered with the free market; how prices soared; and why the people took to the streets and rioted. During 1998, economic growth was negative and income inequality worsened. For many retailers on the island, the collapse of oil rich Venezuela has not been good. What are the lessons of Venezuela`s crisis for Puerto Rico. Can the PR economy say that on average it is OK? Find out the answers in this issue.