JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org.. Center for Latin American Studies at the University of Miami is collaborating with JSTOR to digitize, preserve and extend access to Journal of Interamerican Studies and World Affairs. M t /[uch of economic planning in Latin America has been oriented toward promoting industrialization. These plans have generally given a major role to government, and no doubt there is a significant role that the public sector can and must play in capital mobilization as well as in performing other functions. In most countries, the infrastructural needs alone are enormous and constitute a major challenge for the still rudimentary machinery of public administration and the generally weak fiscal systems.Clearly, however, a very large portion of the capital requirements of industrialization has been supplied by the private sector-with important assistance from foreign enterprises, to be sure, but with the domestic private sectors supplying most of the financing needed to maintain what has been, in most countries, a relatively high rate of industrial development. The focus of this paper is on the mechanism by which this capital has been mobilized by the private sector and on the changes that appear to occur in that mechanism during the process of industrialization. The primary concern is with equity capital rather than loan capital which, in varying degree, is provided by commercial banks and other money-lending entities.The process of capital mobilization in Latin America is, of course, * The author wishes to express appreciation for the financial assistance given him by the Center for International Business Research of the School of Business of the University of Wisconsin. He is grateful also for constructive comments from William P. Glade and Arnold Strickon. 583 This content downloaded from 169.229.32.138 on Fri, 9 May 2014 08:20:13 AM All use subject to JSTOR Terms and Conditions 584 JOURNAL OF INTER-AMERICAN STUDIES AND WORLD AFFAIRS quite different from that found in the more developed economies. In the United States, for example, the saving and the investment functions are performed by different segments of the population, the two being linked by the system of financial institutions which compose the capital market. A whole set of institutions, centering particularly on the security exchanges, provides the mechanism by which the funds of a large number of relatively small and widespread savers are directed to investment opportunities. Similarly structured capital market systems do not exist in Latin America. In the first place, there are no large groups of small savers interested in relatively long-term investments. The majority of savers in the developing economies of Latin America are probably...