The solution lay in structural change in peripheral economies: industrialization using an import substitution strategy (that is, replacing industrial imports with domestic production). After World War II, most of the larger countries in Latin America accepted the ECLA analysis of the problems involved in gearing their economies towards the traditional world division of labor (Baer 1972: 97). Many Latin American countries adopted a mix of trade and macroeconomic policies, typically involving trade barriers and exchange rate controls, taxes on export activities, and import substitution. There were complex mechanisms that gave preferences for strategic imports (for example, capital goods and industrial raw materials), the direct participation of the state in the economy (via state-owned enterprises), and cheap credit for “strategic” sectors.