Bolivian local governments vs. Brazilian national governments

More on my comparative advantage binge:

Another interesting thought I had after one of my interviews here in San
Ignacio has to do, again, with the nature of government intervention in
local economies. Why is it that government intervention here seems to
be relatively efficiency-enhancing, compared to, for example, Brazilian
government intervention during the Brazilian Import Substitution
Industrialization (ISI) period from the 1950s to the 1980s (maybe
Maureen can correct me if my dates are wrong).

The standard story for Brazilian economic under-performance in the '70s
and '80s after a rapid economic boom in the '60s and '50s is that ISI,
which aimed to generate rapid economic growth by promoting internal
markets (and mostly did this by keeping foreign goods out) ultimately
failed because ISI somehow "ran down," after government intervention in
the economy resulted in inefficient outcomes, mostly because of corrupt
rent-seeking behavior, and because very interventionist government
policies caused market distortions that made economic growth easy at
first, but increasingly difficult as time went on, because growth
eventually came to depend on competitive markets abroad for industrial
machinery and other expensive industrial goods. The "Brazilian Miracle"
turned Brazilian nightmare is one of the typical cases used to explain
opposition to state-centered capitalist approaches to development.

Of course, there are other examples of economic growth which seem to
tell a different story--China, South Korea and Vietnam seem to tell a
story about interventionist policies generating sustainable economic
growth, despite the potential for rent-seeking.

And my observations of local governments down here seem to suggest that
local government economic intervention, even in Latin America, tends to
generate more efficient outcomes.

I wonder if one of the differences between these "good" and "bad" cases
are, first, the presence of democratic accountability (not the case in
China or the other Asian economies, but these Latin American local
governments are pretty democratic, especially at the local level), and
second, the presence of mechanisms to promote competitiveness with firms
outside. Although the Asian economies started out very closed, they
relied more on exports to generate growth than internal markets.

In the case of Bolivian municipalities, there are no formal barriers to
trade between municipalities, so firms within each municipality are
competing against other firms in other municipalities, and many of these
municipalities also seek to export their products, with the result that,
even with government intervention, local firms still need to compete.

The result may be pressure for competitiveness that might not have been
present in the Brazilian case, or at least not in the later phases of
Brazilian ISI, when relatively smaller markets for expensive goods
tended to produce less competition between firms.

Could it be that the absence of competition was the cause of both
rent-seeking behavior and high costs? As opposed to rent-seeking
behavior leading to an absence of competition etc.?