In this part of the book, we analyze in detail the workings of the main institutions of the policy-making process in Argentina. We show here that these institutions do not facilitate the development of consistent policies over time, the development of policy-making capabilities, the accumulation of policy-making knowledge and expertise, or the coordination of policy. In particular, we show in Chapters 3 through 6 that Argentina's key political actors tend to have short political horizons, wrong incentives, or both, and that Argentina lacks institutional arrangements, such as a professional bureaucracy or an independent judiciary that, in the presence of short political horizons of the key players, would provide the missing institutional glue to facilitate intertemporal coordination and the enforcement of agreements. Chapter 7, then, shows that these institutional features indeed translate in uncoordinated, incoherent, at times rigid, and systematically unstable policy making, features that necessarily lead to low-quality policies and a lack of incentives to invest in capabilities, with the consequent implications for general well-being.

Chapter 3 analyzes the Argentine Congress. In this chapter, we show that the structure of the Congress and the behavior of its legislators reflect equilibrium behavior given the incentives faced by the legislators and their political masters – the provincial party bosses. In particular, we show that given the latter's political incentives, Argentine legislators although professional politicians are only amateur legislators.