In recent years, the role of Governments has also been vindicated by the experience of Latin America, where Government activism has proved very crucial not only in reducing external dependence and promoting aggregate growth, but also in reducing poverty directly through various innovative social policies (see, for example, Cornia (2010)). While there seems to be agreement about the importance of the role of capable developmental States, it is not clear how such States can emerge in countries that lack them. Grindle (2010) shows that developing countries vary widely with regard to the capability of their States, which range from “very capable” to “failing”.