Content Type: Working Paper / Political Geography: South America / Topic: Economics

1. Economic Integration of Venezuelan Immigrants in Colombia: A Policy Roadmap

Publication Date:: 12-2022
Content Type:: Working Paper
Institution:: Center for Global Development
Abstract:: This paper studies the formal labor market integration and firm creation of Venezuelan immigrants and refugees in Colombia between late 2019 to late 2021. It applies a novel framework to identify segments of the Colombian economy where Venezuelan immigrants and refugees are lagging behind. When it comes to labor market dynamics, we identify professional services as one of the sectors where Venezuelan workers are not integrating fast enough consistently across different parts of the country, hinting that the recognition of professional credentials might be an important bottleneck to effective integration. As for entrepreneurship, we find that sectors where there are fewer firm creations by foreigners as compared to locals include commerce and service industries all across the nation. This paper is accompanied by a set of downloadable files which list sectors of the economy in each geographic department with poor integration of Venezuelan immigrants both for labor markets and firm creation. These lists are meant to be used by national and local policymakers for further investigation of possible market failures or distortions hindering immigrant integration, given our results.
Topic:: Economics, Labor Issues, Immigration, and Economic Integration
Political Geography:: Colombia, South America, and Venezuela

2. International Managerial Skill and Big Colombian Exporting Firms’ Performance, 2006-2014

Author:: Federico Merchan
Publication Date:: 06-2022
Content Type:: Working Paper
Institution:: Kiel Institute for the World Economy (IfW)
Abstract:: This paper uses a sample of the biggest private Colombian exporting firms to propose and estimate a two-step methodology for measuring international managerial skill and calculating its impact on firm performance. The first step quantifies the manager’s organizational capital contribution to improvements in Bloom et al.’s (2021) production efficiency (ability to assemble inputs into final goods) and/or quality capacity (skill to make high quality goods) mechanisms, through the median of export unit value regression residuals at firm-year level (multiplying by -1 the price competition products’ residuals). The second step is regression analysis of firm performance. Results indicate that: i) international managerial quality has a significant and robust positive effect on total export value via the intensive margin, ii) exported value elasticity relative to international managerial quality is around 3 times larger than exported value elasticity relative to exogenous global demand shocks, and iii) better managers in the international market do not necessarily upgrade export quality.
Topic:: Economics, Emerging Markets, International Trade and Finance, Exports, Management, and Labor Market
Political Geography:: Colombia and South America

3. An Integrated Epidemiological and Economic Model of COVID-19 NPIs in Argentina

Author:: Adolfo Rubinstein, Eduardo Levy-Yeyati, Alejandro López Osornio, Federico Filippini, and Adrian Santoro
Publication Date:: 11-2022
Content Type:: Working Paper
Institution:: The John F. Kennedy School of Government at Harvard University
Abstract:: We added a multi-sectoral economic framework to a SVEIR epidemiological model, combining the economic rationale of the DAEDALUS model with a detailed treatment of lockdown fatigue and declining compliance with Public Health and Social Measures reported in recent empirical work, to quantify the epidemic and economic benefits and costs of alternative lockdown and PHSM policies, both in terms of intensity and length. Our calibration replicates key features of the case and death-curves and economic cost for Argentina in 2021. The model allows us to quantify the short-term policy trade-off between lives and livelihoods and show that it can be significantly improved with targeted pharmaceutical policies such as vaccine rollout to reduce mainly severe disease and the death toll from COVID-19, as has been highlighted by previous studies.
Topic:: Economics, COVID-19, and Epidemiology
Political Geography:: Argentina, South America, and Latin America

4. Assessing the Economic, Societal and Cultural Benefits of YouTube in Brazil

Author:: Oxford Economics
Publication Date:: 09-2021
Content Type:: Working Paper
Institution:: Oxford Economics
Abstract:: Read how Oxford Economics and YouTube partnered to identify the economic and societal benefits of YouTube in Brazil. Through our rigorous economic modelling and survey capabilities, we found that, in 2020, YouTube contributed R$3.4 billion to Brazil’s GDP and 122,000 full-time equivalent jobs. Our research shows that YouTube fosters significant positive trends for Brazil’s creators in terms of professional goal achievement, business growth, and improved practical skills, as well as serving as a vital resource for teachers and learners
Topic:: Economics, GDP, Social Media, and YouTube
Political Geography:: Brazil and South America

5. A decomposition method to evaluate the ‘paradox of progress’ with evidence for Argentina

Author:: Javier Alejo, Leonardo Gasparini, Gabriel Montes-Rojas, and Walter Sosa-Escudero
Publication Date:: 12-2021
Content Type:: Working Paper
Institution:: Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:: The ‘paradox of progress’ is an empirical regularity that associates more education with larger income inequality. Two driving and competing factors behind this phenomenon are the convexity of the ‘Mincer equation’ (that links wages and education) and the heterogeneity in its returns, as captured by quantile regressions. We propose a joint least-squares and quantile regression statistical framework to derive a decomposition in order to evaluate the relative contribution of each explanation. The estimators are based on the ‘functional derivative’ approach. We apply the proposed decomposition strategy to the case of Argentina 1992 to 2015.
Topic:: Economics, Education, Inequality, Quantile Regression, and Paradox of Progress
Political Geography:: Argentina and South America

6. Construction of an Extended Environmental and Economic Social Accounting Matrix from a Practitioner’s Perspective

Author:: Onil Banerjee, Martin Cicowiez, Renato Vargas, and Mark Horridge
Publication Date:: 10-2019
Content Type:: Working Paper
Institution:: Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:: In 2014, the United Nations published the first International Standard for environmental economic statistics, known as the System of Environmental-Economic Accounting (SEEA).. As more countries adopt and implement the SEEA, the availability of consistent environmental and economic information increases the need for analytical tools that can use this data to respond to policy relevant questions. In this paper, we present a workflow to develop an environmentally extended social accounting matrix, which can serve as the basic database for the development of environmentally-extended computable general equilibrium models. To illustrate, and given its comprehensive implementation of the SEEA, we apply this workflow to the Guatemalan case and the Integrated Economic-Environmental Modeling (IEEM) Platform.
Topic:: Economics, United Nations, Basic Data, Accountability, Economic Policy, and Statistics
Political Geography:: South America, Latin America, Central America, Guatemala, and Global Focus

7. Global and Local Challenges in Argentina and Brazil

Author:: Guillermo Calvo
Publication Date:: 12-2018
Content Type:: Working Paper
Institution:: Center for Global Development
Abstract:: The last presidential elections in Argentina (2015) and in Brazil (2018), represent a change from populism towards more orthodox economic policies in two important countries in the region. This shift is not only economic but also reflects other fundamental changes in the electorate, in particular the growing dissatisfaction of the population with issues such as weak security and growing corruption in political institutions. In both countries, there are significant fiscal problems and adjustment is needed. But in modern democracies, the success or failure of economic policy is closely tied to political developments. Notably, both countries face their macroeconomic challenges under a parliamentary minority; a situation that is common to many countries in the region at present. Economies highly integrated into the international capital markets, with macroeconomic imbalances inherited from populist governments, face a particularly difficult challenge. On the one hand, the required fiscal tightening entails the execution of policies that may result in greater social unrest, thus encouraging a gradual approach. On the other hand, a gradual approach requires a greater funding stream of financial funds thus exposing the economy to higher financial risk. The dilemma of choosing between a shock adjustment and a gradual approach has been central to understanding what has happened in Argentina and is essential to assessing the options available to the next government in Brazil. The dilemma about the optimal speed of fiscal adjustment has been faced by other countries in the region in the past. In some successful cases of gradualism, the presence of a clear commitment mechanism over the fiscal path, including the implementation of goals agreed with the IMF, has played a decisive role in mitigating the credibility gap typically linked to gradual approaches. One question that the Committee puts forward throughout this statement is to what extent does Argentina's experience entail relevant lessons for Brazil? In order to thoroughly understand these possible lessons and the challenges that both countries face, it is important to consider the similarities and differences between Argentina and Brazil. There is no doubt that both countries are dealing with formidable fiscal challenges. In both countries, there is a primary fiscal deficit and public debt levels are high in relation to GDP. Also, both economies face low or negative growth rates, partly because of cyclical or temporary factors and partly because of low productivity levels due to complex regulatory regimes and tax systems that hinder investment. On the other hand, the realities of Argentina and Brazil are very different in some important aspects. Brazil has not had to cope with a currency crisis and external financing problems such as those of Argentina; the latter has had to reduce its hefty deficit in the current account of the balance of payments. In contrast, Brazil’s external public debt and external financing needs of the public sector are low. However, while the private sector’s foreign indebtedness is quite moderate in Argentina, it is relatively high in the case of Brazil. As regards to monetary policy and inflation, the situation in both countries is also very different. Whereas the inflation rate in Argentina has suffered a substantial increase throughout this year in the context of low credibility in its monetary policy, Brazil has kept a low and stable inflation rate and has significantly improved its central bank’s credibility. These similarities and differences require a differentiated discussion of each country, even if some challenges facing Argentina and Brazil are shared, and whether their experiences provide lessons for each other. The international context plays a fundamental role for both economies in determining the results of economic policy. Before embarking on a more detailed analysis of the challenges facing Argentina and Brazil during the next year, we will analyze how the international context has recently changed, in the next section.
Topic:: Economics, Globalization, Populism, and Local
Political Geography:: Brazil, Argentina, and South America

8. Dossier 10: Argentina Goes Back to the IMF

Author:: Tricontinental: Institute for Social Research
Publication Date:: 11-2018
Content Type:: Working Paper
Institution:: Tricontinental: Institute for Social Research
Abstract:: For six months, Argentina has been confronted with a new economic and social crisis on a massive scale. In the context the devaluation of local currency, rising inflation, and a deep recession, Mauricio Macri’s administration struck an agreement with the IMF, marking a major shift in the country’s future. The agreements slash public spending and prioritize the repayment of debt, among other measures. This dossier examines the different dimensions of the crisis, the open disputes, and the possibilities for the immediate future.
Topic:: Economics, International Cooperation, Neoliberalism, Protests, IMF, and Political Crisis
Political Geography:: Argentina and South America

9. How to Cope with Volatile Commodity Export Prices: Four Proposals

Author:: Jeffrey Frankel
Publication Date:: 07-2017
Content Type:: Working Paper
Institution:: The John F. Kennedy School of Government at Harvard University
Abstract:: Countries that specialize in commodities have in recent years been hit by high volatility in world prices for their exports. This paper suggests four ways that commodity-exporters can make themselves less vulnerable. (1) Option contracts can be used to hedge against short-term declines in the commodity price without giving up the upside, as Mexico has shown. (2) Commodity-linked bonds can hedge longer-term risk, and often have a natural ultimate counter-party in multinational corporations that depend on the commodity as an input. (3) The well-documented pro-cyclicality of fiscal policy among commodity exporters can be reduced by insulating official forecasters against an optimism bias, as Chile has shown. (4) Monetary policy can be made automatically more counter-cyclical, judged by the criterion of currency appreciation in reaction to positive terms-of-trade shocks, under either of two regimes: peggers can add the export commodity to a currency basket (CCB, for “Currency-plus-Commodity Basket”) and others can target Nominal Income instead of the CPI.
Topic:: Agriculture, Economics, Oil, Commodities, Currency Basket, and Indexed Bonds
Political Geography:: South America, Mexico, and Chile

10. Institutions vs. Social Interactions in Driving Economic Convergence: Evidence from Colombia

Author:: Michele Coscia, Timothy Cheston, and Ricardo Hausmann
Publication Date:: 02-2017
Content Type:: Working Paper
Institution:: The John F. Kennedy School of Government at Harvard University
Abstract:: Are regions poor because they have bad institutions or are they poor because they are disconnected from the social channels through which technology diffuses? This paper tests institutional and technological theories of economic convergence by looking at income convergence across Colombian municipalities. We use formal employment and wage data to estimate growth of income per capita at the municipal level. In Colombia, municipalities are organized into 32 departamentos or states. We use cellphone metadata to cluster municipalities into 32 communication clusters, defined as a set of municipalities that are densely connected through phone calls. We show that these two forms of grouping municipalities are very different. We study the effect on municipal income growth of the characteristics of both the state and the communication cluster to which the municipality belongs. We find that belonging to a richer communication cluster accelerates convergence, while belonging to a richer state does not. This result is robust to controlling for state fixed effects when studying the impact of communication clusters and vice versa. The results point to the importance of social interactions rather than formal institutions in the growth process.
Topic:: Development, Economics, Science and Technology, Economic Growth, and Institutions
Political Geography:: Colombia and South America

11. Exploring the Uncharted Export: An Analysis of Tourism-Related Foreign Expenditure with International Spend Data

Author:: Michele Coscia, Ricardo Hausmann, and Frank Neffke
Publication Date:: 11-2016
Content Type:: Working Paper
Institution:: The John F. Kennedy School of Government at Harvard University
Abstract:: Tourism is one of the most important economic activities in the world: for many countries it represents the single largest product in their export basket. However, it is a product difficult to chart: "exporters" of tourism do not ship it abroad, but they welcome importers inside the country. Current research uses social accounting matrices and general equilibrium models, but the standard industry classifications they use make it hard to identify which domestic industries cater to foreign visitors. In this paper, we make use of open source data and of anonymized and aggregated transaction data giving us insights about the spend behavior of foreigners inside two countries, Colombia and the Netherlands, to inform our research. With this data, we are able to describe what constitutes the tourism sector, and to map the most attractive destinations for visitors. In particular, we find that countries might observe different geographical tourists' patterns - concentration versus decentralization -; we show the importance of distance, a country's reported wealth and cultural affinity in informing tourism; and we show the potential of combining open source data and anonymized and aggregated transaction data on foreign spend patterns in gaining insight as to the evolution of tourism from one year to another.
Topic:: Economics, Political Economy, and Tourism
Political Geography:: Europe, Colombia, South America, and Netherlands

12. Weathering Collapse: An Assessment of the Financial and Operational Situation of the Venezuelan Oil Industry

Author:: Roberto Hernández Hernández and Francisco J. Monaldi
Publication Date:: 11-2016
Content Type:: Working Paper
Institution:: The John F. Kennedy School of Government at Harvard University
Abstract:: Venezuela has one of the most abundant geological endowments in the world. Oil proven reserves are among the largest globally, even if a more conservative criterion than the one used by the current government is applied. However, these resources are qualitatively different than those of other abundant regions such as the Middle East. The large majority constitutes extra-heavy oil, which generally requires higher oil prices to be extracted profitably. During the last decade, the Venezuelan oil industry wasted a unique opportunity to increase investment and production. At the high oil prices that prevailed, the massive oil reserves could have been monetized by rapidly increasing production with a large margin of profitability. Quite to the contrary, production steadily dropped due either to lack of investment in the new unconventional oil projects or for failing to compensate the decline of the older conventional fields. It is a tragic story of great potential with dismal performance. A series of trends were negatively impacting the Venezuelan oil industry even before the oil price collapse in 2014. From the revenue side, although oil prices showed an increase in real terms of 120% between 2000 and 2014, the barrels that effectively generate cash for Venezuela have shown a continuous decline. This is not just because production has been declining for the most part during the last eighteen years (a trend that has gotten significantly worse during the last year), but also because of a number of developments. First, during that period, total exports have declined more rapidly than production, and recently, net exports have declined more than total exports. Consumption in the massively subsidized domestic market increased until 2013 (when it started to decline likely because of the recession in the local economy), while imports of oil products for the domestic market have increased since 2012. The domestic market not only generates negative cash-flow for the national oil company (NOC), PDVSA, but also its expansion reduced the barrels available to export. More recently, there has also been an increase in imports of light oil and naphtha as diluents for the extra-heavy oil. Second, the Venezuelan production basket has become heavier and the share of unconventional production, generally less profitable, has increased. Third, the production wholly operated by PDVSA has been falling much more rapidly, while the production share of joint-ventures increased. Fourth, a significant share of the exports to Latin America and the Caribbean is subsidized (although these exports have declined recently). Fifth, some oil exports are committed to repay debts of PDVSA and specially the Venezuelan government, limiting the actual cash flow received by the company. In particular, the government’s debt agreements with China involve a significant and increasing amount of production, although recently those agreements were restructured, allowing for a grace period with no capital amortization. From the expenditure side, PDVSA was increasingly responsible of carrying social expenditures and activities not related to the oil industry, which limited the resources for highly profitable investments. That is in addition to the increased fiscal take due to changes in the tax legislation. Also, higher investment requirements due to an increase in the equity share of PDVSA in joint venture projects, has had an impact on its cash flow. The explanations for the underperformance of the Venezuelan oil industry basically fall into two connected categories: the multiple problems facing PDVSA; and the increase in above-ground risks for foreign investors operating in the country. The deterioration of the institutional framework, led to radical fiscal and regulatory changes, and to the nationalization of the majority of the industry. In addition, the substantial over-extraction of resources from the NOC, the significant macroeconomic distortions affecting the cost structure of oil companies, and the constraints imposed by the energy infrastructure and human capital availability; have combined to produce dismal results. The massive firing of the majority of the management and technical experts from PDVSA in 2003 following the political conflict that led to a strike, has left the company with limited capabilities to operate effectively. The recent decline in oil prices, and the changes in the international market structure, have exposed more dramatically the difficulties facing the Venezuelan oil sector, and call into question its ability to prevent a continuation of the declining trend in oil extraction. This situation becomes particularly severe if we take into account the cash flow constraints facing PDVSA, as well as its multiple operational problems, power cuts, and conflicts with oilfield services providers. These challenges are proportional to the enormous investments required to finance the projects in the Orinoco Oil Belt, where most of the reserves in Venezuela are located, and where the quality of the crude and the lack of development of the region, are just two of the many issues that need to be addressed. Since this paper is part of a wider project to understand the macroeconomic challenges facing the country in 2016-17, it focuses narrowly on the financial problems of the oil industry in the short-term and the operational challenges that could impede its recovery in the next couple of years. Within this context, it largely analyzes the upstream operations, i.e. oil extraction, rather than the downstream, given that in the former is where the oil rents are generated and constitutes the main source of foreign exchange and fiscal revenues of Venezuela. Other areas for further research are mentioned at the end of the document.2 Official figures are used to the extent that they are publicly available. An important aspect that prevents an exhaustive evaluation of the oil sector in Venezuela is the lack of available information regarding key performance indicators affecting the cost structure of oil projects, the cash flow of PDVSA, and the fiscal contributions of the oil sector to the government, among other important variables. Thus, on occasion, estimations for variables of interest and explanations for their divergence from official figures are provided. The paper has two main sections. The first one analyzes the issues affecting the cash flow of PDVSA, the effects of macroeconomic and fiscal variables on both revenues and costs, as well as other financial issues affecting the performance of the company. The second section discusses some of the operational challenges facing the industry and mentions areas for further research. 2 For a more general overview of the recent developments of the oil sector in Venezuela see Monaldi (2015)
Topic:: Economics, International Trade and Finance, Oil, and Natural Resources
Political Geography:: South America and Venezuela

13. Inequality and Fiscal Redistribution in Middle Income Countries: Brazil, Chile, Colombia, Indonesia, Mexico, Peru and South Africa

Author:: Nora Lustig
Publication Date:: 08-2015
Content Type:: Working Paper
Institution:: Center for Global Development
Abstract:: This paper examines the redistributive impact of fiscal policy for Brazil, Chile, Colombia, Indonesia, Mexico, Peru and South Africa using comparable fiscal incidence analysis with data from around 2010. The largest redistributive effect is in South Africa and the smallest in Indonesia. While fiscal policy always reduces inequality, this is not the case with poverty.
Topic:: Economics, Poverty, and Social Stratification
Political Geography:: Africa, South America, and Latin America

14. Peace and Stability in the Post-Conflict Era

Author:: Douglas Farah, Robert D. Lamb, and Carl Meacham
Publication Date:: 03-2014
Content Type:: Working Paper
Institution:: Center for Strategic and International Studies
Abstract:: The project that culminated in this report was conceived just over a year ago as an initiative to assess the major accomplishments in strengthening the Colombian government's efforts to bring peace and stability to its countryside.
Topic:: Development, Economics, Terrorism, International Security, and Governance
Political Geography:: South America

15. Amazonian policy and politics, 2003-13: deforestation, hydropower and biofuels

Author:: Eduardo Viola and Larissa Basso
Publication Date:: 04-2014
Content Type:: Working Paper
Institution:: Norwegian Centre for Conflict Resolution
Abstract:: In the period 2003-13 Brazil experienced important economic and political developments: it became a much more relevant international player; its economy entered the world's top ten; and society became more politically active and expressed its complaints more aggressively. Amazonian policy and the politics of the period developed in this context, and three issues played a central role. Firstly, a cutback in deforestation led to a decrease in Brazil's carbon emissions by around one-third, which is a unique situation in the world. Secondly, despite the region's hydropower potential, projects developed slowly due to new environmental requirements and societal opposition. Thirdly, the production of biofuels was greatly encouraged by the introduction of flexible-fuel vehicles technology, but lost momentum after the discovery of offshore oil reserves; and there was a heated debate about the relationship between the expansion of sugar-cane plantations and deforestation after the decline in deforestation demonstrated that such plantations were not its main cause. Analysis indicates that there were three trends in Amazonian environmental policy and politics during the decade: continuity of former policies (2003-05), an upward trend towards sustainability (2005-10) and a downward trend (2010-13). The results of the 2014 elections are key to predicting future developments.
Topic:: Economics, Environment, Human Rights, Politics, and Governance
Political Geography:: Brazil and South America

16. Governance Transfer by the Organization of American States (OAS)

Author:: Mathis Lohaus
Publication Date:: 03-2014
Content Type:: Working Paper
Institution:: Collaborative Research Center (SFB) 700
Abstract:: This case study examines to which extent the Organization of American States (OAS) engages in governance transfer to its member states. Both the standards and policies prescribed in regional documents as well as their application are analyzed. Historically, the organization has emphasized two areas. Human rights are protected through multiple treaties and a strong regional legal regime. Democracy is protected by strong incentives to avoid coups and supported via different types of assistance, including a long-standing system of election observation. The OAS addresses good governance since the 1990s, particularly with regard to combating corruption and modernizing public management. Provisions concerning the rule of law are addressed in connection with the other standards. After analyzing the framework and measures of governance transfer, this report explores how the observed patterns can be explained and briefly discusses the future prospects for the OAS.
Topic:: Economics, Human Rights, International Cooperation, and Governance
Political Geography:: America, South America, and North America

17. Uncertain Energy: The Caribbean's Gamble with Venezuela

Author:: David L. Goldwyn and Cory R Gill
Publication Date:: 07-2014
Content Type:: Working Paper
Institution:: Atlantic Council
Abstract:: It has been nearly ten years since the launch of Petrocaribe, a program designed to win the political loyalty of the Caribbean states through generous credit subsidies to help import Venezuelan crude oil and products. Recipient states have grown dependent on high-cost, high-carbon fuels for power generation and Venezuelan credit to balance their budgets.
Topic:: Economics, Energy Policy, International Trade and Finance, and Oil
Political Geography:: South America, Latin America, Caribbean, and Venezuela

18. Dilemmas of Brazilian Grand Strategy

Author:: Hal Brands
Publication Date:: 08-2010
Content Type:: Working Paper
Institution:: The Strategic Studies Institute of the U.S. Army War College
Abstract:: This monograph analyzes Brazilian grand strategy under President Luiz Inácio Lula da Silva. During Lula's nearly 8 years in office, he has pursued a multipronged grand strategy aimed at hastening the transition from unipolarity and Western economic hegemony to a multipolar order in which international rules, norms, and institutions are more favorable to Brazilian interests. Lula has done so by emphasizing three diplomatic strategies: soft balancing against the United States, building coalitions to magnify Brazilian negotiating power, and seeking to position Brazil as the leader of a more united South America.
Topic:: Economics, Globalization, International Trade and Finance, and Regional Cooperation
Political Geography:: United States, Brazil, South America, and Latin America

19. The Value of Water in Bolivia: An Economic Resource or a Human Right?

Author:: Enrique Castañón Ballivián
Publication Date:: 04-2010
Content Type:: Working Paper
Institution:: Institute for Advanced Development Studies (INESAD)
Abstract:: After the 2000 ‘Water-War’, access to water in Bolivia has become a major social demand and thus a prime and contentious political issue. The event has revealed an overwhelming opposition to neo-liberal approaches to water management and has allowed the articulation of a new discourse that sees water not as an economic resource but as a human right. In this context, the paper reviews the two contrasting positions within the debate about whether or not water should be treated as an economic resource. In doing so, it presents the arguments underpinning each position which then allows it to elaborate some relevant conclusions.
Topic:: Economics, Markets, War, Water, Culture, and Indigenous
Political Geography:: South America and Bolivia

20. Latin America and the Global Economic Crisis

Publication Date:: 03-2009
Content Type:: Working Paper
Institution:: Oxfam Publishing
Abstract:: An overview of the region up to 30 January 2009 by the UN Economic Commission for Latin America and the Caribbean (cepal) argues that the larger economies have been more directly affected by the global economic crisis (because in general they are more integrated with the global markets, especially finance), but are also better equipped to respond to it. In particular, Cepal sees South America as diverging from Central America and the Caribbean, which seem to be both less resilient in terms of their economies, and more exposed to the slump in the USA. They are being driven back to aid as the last/only resort. Mexico is in a category of its own, the most exposed to the US downturn, but as a large economy and an oil exporter, better placed to withstand the downturn than its Caribbean basin neighbours.
Topic:: Economics, Globalization, and International Political Economy
Political Geography:: South America, Latin America, and Caribbean

21. Brazil in the Global Economy: Measuring the Gains From Trade

Author:: Sandra Polaski, Dirk Willenbockel, Eduardo Zepeda, Scott McDonald, Joaquim Bento de Souza Ferreir, Janine Berg, and Karen Thierfelder
Publication Date:: 03-2009
Content Type:: Working Paper
Institution:: Carnegie Endowment for International Peace
Abstract:: Brazil's economic growth rate has been positive for the past eight years, after two decades of setbacks and extreme volatility. The country has once again been growing—for a sustained period—at rates that exceed its population growth, with average gross domestic product (GDP) growth per capita averaging 1.63 percent from 2000 to 2007. This exceeds average per capita GDP growth of 0.83 percent from 1980 to 1989 and 0.28 percent from 1990 to 1999, although it still falls well short of the 5.92 percent per capita growth rate from 1970 to 1979.
Topic:: Economics, International Trade and Finance, Labor Issues, and Governance
Political Geography:: Brazil and South America

22. Reforms and Counter-Reforms in Bolivia

Author:: Luis Carlos Jemio, Fernando Candia, and José Luis Evia
Publication Date:: 06-2009
Content Type:: Working Paper
Institution:: Institute for Advanced Development Studies (INESAD)
Abstract:: Towards the end of the 1970s and beginning of the 1980s, Bolivia experienced a period of deep economic and political crisis, resulting from the international economic shocks that hit the country at the time and from the large levels of foreign indebtedness the country had acquired during the 1970s. The crisis was characterized by hyperinflation, continuous drops in GDP, economic uncertainty and political volatility. Starting in 1985, after a change in government, Bolivia embarked in a comprehensive program of structural reforms aimed at stabilizing the economy and at removing the structural constraints which precluded faster economic growth and increases in productivity. The reform package was implemented over a period of time which began in 1985 and lasted for approximately 20 years. The reform policies comprised measures such as the opening of the economy to foreign trade; price, exchange rate and interest rate liberalizations; fiscal adjustments; central bank independence; instauration of a financial regulation and supervision system; capitalization and privatization of public enterprises; pension reforms; decentralization of the public administration; strengthening of key public institutions, (e.g. the internal revenue and customs offices, and the national road administration), among the most noticeable.
Topic:: Economics, Reform, Trade, and Liberalization
Political Geography:: South America and Bolivia

23. Earnings Mobility in Times of Growth and Decline: Argentina from 1996 to 2003

Author:: Gary S. Fields and María Laura Sánchez Puerta
Publication Date:: 01-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: In recent years, the economy of Argentina has experienced both rapid economic growth and severe economic decline. In this paper, we use a series of one -year long panels to study who gained the most in pesos when the economy grew and who lost the most in pesos when the economy contracted. To answer these questions, we test two hypotheses both unconditionally and conditionally. The 'divergence of earnings' hypothesis holds that in any given year, the highest earning individuals are those who experienced the largest earnings gains or the smallest earnings losses in pesos. The 'symmetry of gains and losses' hypothesis holds that those groups that gained the most in pesos when the economy grew are those that lost the most in pesos when the economy contracted. Both hypotheses are decisively rejected in the data.
Topic:: Development and Economics
Political Geography:: Argentina and South America

24. Export Productivity and Specialization in China, Brazil, India and South Africa

Author:: Amelia U. Santos-Paulino
Publication Date:: 03-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper analyses the patterns of export productivity and trade specialization profiles in the China, Brazil, India and South Africa, and in other regional groupings. In doing so, the investigation calculates a time varying export productivity measure using highly disaggregated product categories. The findings indicate that export productivity is mainly determined by real income and human capital endowments. Importantly, the study reveals significant differences in the export productivity and specialization patterns of countries with comparable per capita income levels. For instance, China's export productivity and implied export sophistication is in line with that of countries with higher per capita incomes, including some OECD industrial economies.
Topic:: Economics and International Trade and Finance
Political Geography:: Africa, China, India, Asia, South Africa, Brazil, and South America

25. Inflation and Financial Development: Evidence from Brazil

Author:: Manoel Bittencourt
Publication Date:: 02-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: We examine the impact of inflation on financial development in Brazil and the data available permit us to cover the period between 1985 and 2002. The results – based initially on time-series and then on panel time-series data and analysis, and robust for different estimators and financial development measures – suggest that inflation presented deleterious effects on financial development at the time. The main implication of the results is that poor macroeconomic performance has detrimental effects to financial development, a variable that is important for affecting, for example, economic growth and income inequality. Therefore, low and stable inflation, and all that it encompasses, is a necessary first step to achieve a deeper and more active financial sector with all its attached benefits.
Topic:: Economics
Political Geography:: Brazil and South America

26. Constructive Data Mining: Modeling Argentine Broad Money Demand

Author:: Neil R. Ericsson and Steven B. Kamin
Publication Date:: 09-2008
Content Type:: Working Paper
Institution:: Board of Governors of the Federal Reserve System
Abstract:: his paper assesses the empirical merits of PcGets and Autometrics–two recent algorithms for computer-automated model selection–using them to improve upon Kamin and Ericsson’s (1993) model of Argentine broad money demand. The selected model is an economically sensible and statistically satisfactory error correc- tion model, in which cointegration between money, inflation, the interest rate, and exchange rate depreciation depends on the inclusion of a “ratchet” variable that cap- tures irreversible effects of inflation. Short-run dynamics differ markedly from the long run. Algorithmically based model selection complements opportunities for the researcher to contribute value added in the empirical analysis.
Topic:: Economics, Markets, Finance, and Inflation
Political Geography:: Argentina and South America

27. Analysis of Poverty and Inequality in Bolivia, 1999-2005: A Microsimulation Approach

Author:: Claudia Gutierrez
Publication Date:: 01-2008
Content Type:: Working Paper
Institution:: Institute for Advanced Development Studies (INESAD)
Abstract:: This paper studies the changes in inequality and poverty in the period 1999-2005 in Bolivia through the analysis of the changes in the labour market. A decomposition method based on micro-simulation techniques was applied. The decomposition works with an income generation model at the household level, which is a set of equations for the individual earnings and for the labour supply and occupational choices for each member of the household. We decomposed the observed change in inequality into four components: i) a shift in the income distribution related to a change in employment rates and the shares of wage and non-wage labour among the employed population (participation effect); ii) a shift related to changes in the remuneration of observed characteristics of the employed population (price effect); iii) a shift related to a change in the distribution of error terms of estimated earnings functions (error term effect); and iv) a residual change in inequality not captured by the first three simulated changes in the income distribution. According to our results the increase in inequality of 3 points of the Gini coefficient, was explained by approximately 1 point for the participation, price and error term effects and 2 points for the residual change. The increase in the unemployment rate, the shift in the participation of the non wage earners, the rise in wages and the more unequal distribution of unobserved productive talents deteriorated the income distribution in this period in Bolivia. Regarding the poverty incidence, the observed variation was a reduction by 3 points explained mainly by the residual change. The low magnitude of the simulated effects as determinants of the decline in poverty in those years can be explained by the rising participation of the non labour incomes in the total household income.
Topic:: Development, Economics, Poverty, Inequality, and Simulation
Political Geography:: South America and Bolivia

28. The Impact of Community-Based EcoTourism Projects in Amboró National Park

Author:: Fabián Soria
Publication Date:: 03-2008
Content Type:: Working Paper
Institution:: Institute for Advanced Development Studies (INESAD)
Abstract:: This research examines selected Community Ecotourism projects in the Amboró National Park in Bolivia, which have been established by local environmental NGOs. The objective is to investigate the impact of these projects on the livelihoods and social relations in the communities. The main question that concerns us is if the projects have been effective in reducing or alleviating poverty and vulnerability, whilst providing environmental sustainability. The research also provides insight into the impact of the projects on social, cultural and economic structures of the communities. Furthermore, it will show whether the beneficiaries see Community Ecotourism projects as an important income and activity diversification option, and if they see the projects as environmentally sustainable. These issues can determine the final outcome of the project, and thus become decisive to evaluate if such projects can be used as a strategy to improve living conditions and reduce poverty. The research relies on interviews and data collected during fieldwork in Bolivia in July-August 2007. Four different Community Ecotourism projects in the Amboró National Park were visited, as well as key informants and stakeholders.
Topic:: Economics, Environment, Poverty, Sustainability, and Ecotourism
Political Geography:: South America and Bolivia

29. The Chilean agricultural transformation during the second half of the twentieth century: A story of institutional change

Author:: Antonio Saravia
Publication Date:: 10-2008
Content Type:: Working Paper
Institution:: Institute for Advanced Development Studies (INESAD)
Abstract:: The second half of the twentieth century witnessed a dramatic transformation of the Chilean agricultural sector. From accounting for only five percent of the value of Chile’s total exports in the late 1960s, agricultural exports grew to account for more than 30 percent of this value in the mid 1990s. Using a modified neoclassical growth formulation, we show that the transformation of the Chilean agricultural sector can be associated with institutional changes or modifications to the sector’s basic functioning structure. In particular, our historical review shows that changes in the definition of property rights over land, caused by the Chilean agrarian reform first and the general economic reform later, seem to have greatly caused the changes in the sector’s levels of investment and production.
Topic:: Agriculture, Economics, Institutions, Land Rights, and Property
Political Geography:: South America and Chile

30. Booms and Collapses of the Hydro Carbons Industry in Bolivia

Author:: Luis Carlos Jemio
Publication Date:: 12-2008
Content Type:: Working Paper
Institution:: Institute for Advanced Development Studies (INESAD)
Abstract:: This paper analyses the performance of the hydrocarbons sector in Bolivia over the last 46 years. The analysis focuses on the factors that have determined the sector’s behavior overtime. First, there is the institutional framework that regulates the sector’s activities, which can play an important role in promoting investment flows, and thus endorse a much faster sector development. The institutional framework comprises several factors, being the most important the existing tax system and the nature of the contractual relationship between the state and the oil company. The stability of the institutional framework is also of paramount importance.
Topic:: Economics, Markets, Oil, Gas, and Investment
Political Geography:: South America and Bolivia

31. Competition Law and Policy in Argentina

Publication Date:: 10-2006
Content Type:: Working Paper
Institution:: The Organisation for Economic Co-operation and Development
Abstract:: In the past 25 years Argentina has made considerable, if uneven, progress toward building a successful market economy. In any country, an effective competition policy is an important part of that effort. Argentina's progress in competition policy has also been uneven, having been affected in many ways by the country's turbulent political and economic history.
Topic:: Development, Economics, and Markets
Political Geography:: Argentina and South America

32. Tougher Challenges Ahead for Colombia's Uribe

Publication Date:: 10-2006
Content Type:: Working Paper
Institution:: International Crisis Group
Abstract:: President Alvaro Uribe was overwhelmingly reelected in May 2006, two months after parties supporting him won large majorities in the Congress. The armed forces are stronger than they have ever been, and U.S. aid appears relatively secure. As he begins his second four-year term, Uribe seems to be in a stronger position to tackle Colombia's long-standing problems: drug trafficking, the internal conflict, continued lack of security and poverty in rural areas, corruption, and social inequality. But appearances may be deceiving. His governing coalition is fractious, his popularity vulnerable to what a still powerful insurgency chooses to do. He has yet to define a comprehensive second-term strategy for peace and development that addresses these issues and puts a priority on bringing rural Colombia into the political, economic and social mainstream.
Topic:: Economics, Peace Studies, and Politics
Political Geography:: United States, Colombia, and South America

33. The Rise and Halt of Economic Development in Brazil, 1945-2004: Industrial Catching-up, Institutional Innovation and Financial Fragility

Author:: Nelson H. Barbosa-Filho, José A.P. de Souza, and Leondardo Burlamaqui
Publication Date:: 08-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper seeks to explain the dynamics of Brazilian industrial catch-up in the last 60 years by discussing its background institutional conditions as well as its main macroeconomic features. After a brief introduction, the second section describes how after the institutional innovations introduced during the Vargas' and Kubitschek's administrations, a Brazilian version of the Developmental State was created, releasing the growth potential of the economy during the 1950s. The third section analyses the inflationary crisis and institutional inertia of the mid-1960s, and its solution through the introduction of a new of wave of institutional innovations and conflict management devices, which lead to the Brazilian growth miracle, until the debt crisis of early 1980s signaled its end. The fourth section analyses why the financial crisis, coupled with ineffective institutional changes and unsuccessful macroeconomic stabilization plans lead growth to a halt. It also includes an analysis of the pro-market reforms from the early 1990s onwards. The fifth section concludes the paper offering a brief sketch on how the analytical narrative fits the conceptual framework within which it was performed.
Topic:: Conflict Resolution, Development, and Economics
Political Geography:: Brazil and South America

34. Development in Chile 1990-2005: Lessons from a Positive Experience

Author:: lvaro Garca Hurtado
Publication Date:: 02-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Chile, in the last 15 years, has shown remarkable results in terms of growth, poverty reduction and democratic governance. This pa per reviews the structural changes that were behind these positive outcomes, as well as the pending challenges for Chile's development. Also shows that Chile did better in terms of growth than social integration and that this is related to the weak representation and participation of a wide majority in the national debate and decision making process. It also draws conclusions valid for other Latin American countries' development.
Topic:: International Relations, Development, and Economics
Political Geography:: South America and Chile

35. Why Have All Development Strategies Failed in Latin America?

Author:: Guillermo Rozenwurcel
Publication Date:: 02-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: After the Great Depression and throughout the rest of the twentieth century, Latin American countries basically approached economic development following two successive and quite opposed strategies. The first one was import substitution industrialization. The second was the so-called Washington Consensus approach. While the two views were founded on quite opposite premises, neither the import substitution industrialization nor the Washington Consensus managed to deliver sustained economic development to Latin American countries. Two domestic elements are crucial to understand this outcome. One is the failure of the state. The second is the inability to achieve mature integration into the world economy.
Topic:: Development, Economics, and Government
Political Geography:: Washington, South America, and Latin America

36. Living with Hugo: U.S. Policy Toward Hugo Chávez's Venezuela

Author:: Richard Lapper
Publication Date:: 11-2006
Content Type:: Working Paper
Institution:: Council on Foreign Relations
Abstract:: The popularity of the new political and economic model being developed in Venezuela has been a consistent source of aggravation for the U.S. government. Since first winning the presidency in December 1998, Hugo Chávez has been able through repeated electoral victories and radical constitutional reform to dominate Venezuela's government and public institutions. Undaunted by stiff U.S. opposition, President Chávez has launched what he calls a Bolivarian revolution, named after Simón Bolívar, a nineteenth-century leader of Latin America's independence wars. Chávez has reasserted the role of the state in the Venezuelan economy and developed extensive social programs to advance an anti- U.S., anti-capitalist crusade. New or newly reinvigorated alliances with established U.S. adversaries have helped internationalize Chávez's aims. Most alarming to those concerned with the health of Venezuelan democracy, Chávez and his allies have concentrated political power in the hands of the executive, curtailed the independence of the judiciary, shown limited tolerance for domestic critics, and openly intervened in the electoral politics of neighboring states.
Topic:: Conflict Prevention, Foreign Policy, Development, Economics, and Politics
Political Geography:: United States, South America, and Latin America

37. How Best to Use the Extraordinary Natural Gas Revenues in Bolivia? Results from a Computable General Equilibrium Model

Author:: Lykke E. Andersen
Publication Date:: 12-2006
Content Type:: Working Paper
Institution:: Institute for Advanced Development Studies (INESAD)
Abstract:: The high oil prices and the sharp increases in royalties mean that the natural gas boom in Bolivia has become very important for the economy, and particularly important as a source of government revenues. Using a CGE model, Andersen et al (2006) show that the natural gas boom is likely to boost GDP growth by about 1 percentage point per year. However, if the government continues with past spending and investment patterns, the boom is also likely to have a very adverse effect on the income distribution, so much so that the poorest half of the population is likely to experience absolute reductions in their real income levels compared to a scenario without gas boom. The present paper explores alternative uses of natural gas revenues in the CGE model to see if a better outcome can be engineered.
Topic:: Economics, Gas, Inequality, and Revenue Management
Political Geography:: South America and Bolivia

38. What Iraq and Argentina Might Learn from Each Other

Author:: Anna Gelpern
Publication Date:: 06-2005
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: Financial collapse usually triggers a flurry of market, academic, and policy innovation. The Latin American debt crisis of the 1980s produced the Brady Bonds and led to the rise of today's emerging markets. In the late 1990s, crises in Pakistan, Ecuador, and Ukraine helped teach the markets how to restructure international sovereign bonds. Crises in Mexico, Russia, Brazil, Turkey, and throughout East Asia raised doubts about the international system's ability to manage vast and rapid capital flows, and prompted a big-picture reassessment under the rubric “international financial architecture.” This included most famously the sovereign bankruptcy proposals discussed elsewhere in this volume.
Topic:: Development and Economics
Political Geography:: Pakistan, Russia, Turkey, Ukraine, Middle East, East Asia, Brazil, South America, Latin America, and Mexico

39. What Bond Markets Can Learn from Argentina

Author:: Anna Gelpern
Publication Date:: 04-2005
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: Argentina has completed the largest and most complex sovereign bond restructuring in history. Before the debt exchange, it owed about $82 billion in principal and $20 billion in past due interest. Hundreds of thousands of creditors held 150 kinds of defaulted instruments issued in six currencies under the laws of eight jurisdictions. Creditors owed just over 76% of the total, or $62 billion, got $35 billion in new performing bonds. Other performing debt includes $40 billion in domestic and about $30 billion in multi-lateral obligations. Argentina left behind almost $25 billion in defaulted principal and interest.
Topic:: Development, Economics, and International Trade and Finance
Political Geography:: Argentina and South America

40. CERI: Eighteen months into Lula's presidency, how is Brazil faring?

Author:: François d'Arcy
Publication Date:: 07-2004
Content Type:: Working Paper
Institution:: Centre d'Etudes et de Recherches Internationales
Abstract:: This study, which examines the chances of success of the government of Luiz Ináci Lula da Silva, takes as its starting point the idea that the main obstacle resides in the structure of the Brazilian political system. Being unable to reform that system, President Lula has skilfully adapted to it, but not without having to forge certain unusual alliances. He has, nevertheless, honoured the campaign promises which brought him to power after three unsuccessful attempts in a row, maintaining anti-inflationary policies and strict budgetary discipline, and respecting commitments given concerning public debt and privatised companies. This macroeconomic policy – which follows on from that of Fernando Henrique Cardoso – dominated his government's first year in office, slowing the implementation of new policies addressing social issues and sustainable development. So far, the latter policies would appear to point more to continuity than to radical change, a fact which will, doubtless, contribute greatly to their success.
Topic:: Economics, Government, and Politics
Political Geography:: Brazil and South America

41. Unemployment, Macroeconomic Policy and Labor Market Flexibility: Argentina and Mexico in the 1990s

Author:: Roberto Frenkel and Jaime Ros
Publication Date:: 02-2004
Content Type:: Working Paper
Institution:: Kellogg Institute for International Studies
Abstract:: This paper compares the divergent unemployment experiences in Argentina and Mexico in the 1990s, examining in detail the remarkable contrasts in the adjustment of the labor market in these two countries that occur despite equally striking similarities in the evolution of a number of macroeconomic variables and external economic shocks. The paper focuses on the role of macroeconomic policies and the type of industrial restructuring in these developments and considers to what extent the divergent unemployment experiences can be explained by differences in the institutional characteristics of the labor market.
Topic:: Economics and Industrial Policy
Political Geography:: Argentina, South America, North America, and Mexico

42. Parental Wealth Effects on Living Standards and Asset Holdings: Results from Chile

Author:: Florencia Torche and Seymour Spillerman
Publication Date:: 11-2004
Content Type:: Working Paper
Institution:: Institute for Social and Economic Research and Policy at Columbia University
Abstract:: This paper examines aspects of the replication of inequality across generations and attempts to assess the extent to which parental resources influence the life chances and living standards of adult children. We expect household wealth to be a critical matter, especially in a society in which there is a weak public safety net or in which the credit market is inefficient. In the former case, families need to self-insure--accumulate savings to smooth consumption expenditures over periods of income fluctuation, such as might result from illness or job loss. In the latter case, financial wealth is necessary in order to finance large expenditure items (e.g., a home, a new business) or to provide collateral in seeking a bank loan for such an expenditure.
Topic:: Development, Economics, and Human Welfare
Political Geography:: South America

43. The Role of Perceived Opportunity in Fertility Choice: Evidence from Latin America

Author:: Louise C. Keely and Margaret MacLeod
Publication Date:: 06-2004
Content Type:: Working Paper
Institution:: The Brookings Institution
Abstract:: We hypothesize that the perceived returns to human capital and to income uncertainty are important determinants of recent cross-sectional variation in Latin American fertility. An empirical study of cross-country individual level data supports the hypothesis. In particular, we find that a higher perceived return to human capital and higher income uncertainty both lead to higher fertility, all else equal. We interpret the evidence to suggest that increasing economic opportunity in Latin America should be accompanied by institutions that provide social protection in order to promote further decreases in fertility toward the replacement rate.
Topic:: Economics, Gender Issues, and Human Welfare
Political Geography:: South America, Latin America, Central America, and Caribbean

44. Pension Reform in Bolivia: A Review of Approach and Experience

Author:: Federico Escobar and Osvaldo Nina
Publication Date:: 06-2004
Content Type:: Working Paper
Institution:: Institute for Advanced Development Studies (INESAD)
Abstract:: The Bolivian pension reform eliminated the old publicly managed pay-as-you-go system and introduced a fully-funded system. The pension reform was highly influenced by the Chilean reform, adopting a second pension component pillar, based on contributions to individual accounts in pension funds, which are managed by decentralized pension-fund management companies and regulated and supervised by the government. Moreover, the new system has followed the substitutive model, where all contributors to the old system, with no exceptions, were automatically transferred to the new one, while those already retired under the old system continued to receive their pensions from the government. The unique feature of the Bolivian pension reform program was its link to the Capitalization. Under this process the six principal state-owned enterprises were capitalized by foreign companies, and the Bolivian government retained 50% of the shares in the capitalized companies. These shares went into a Collective Capitalization Fund, which is managed by the new pension funds, and the dividends are used to finance the BONOSOL program, which is a universal old age income support to all Bolivians 65 and older.
Topic:: Economics, Reform, Public Policy, and Pension
Political Geography:: South America and Bolivia

45. News or Noise? An Analysis of Brazilian GDP Announcements

Author:: Rebeca de la Rocque Palis, Roberto Luis Olinto Ramos, and Patrice Robitaille
Publication Date:: 08-2003
Content Type:: Working Paper
Institution:: Board of Governors of the Federal Reserve System
Abstract:: Revisions to GDP announcements in many countries are often large, and Faust, Rogers, and Wright (2003) have found that G-7 GDP revisions are predictable to varying degrees. In this paper, we extend FRW to study revisions to Brazilian GDP announcements. We document that revisions to Brazilian GDP are large relative to those of G-7 countries. Brazilian GDP revisions are also predictable, which is consistent with the view that GDP revisions correct errors in preliminary GDP rather than reflect news. However, GDP revisions are far from being entirely predictable. Although GDP revisions are largest only one year following the initial GDP release, those revisions are nearly unpredictable.
Topic:: International Relations, Economics, and International Trade and Finance
Political Geography:: Brazil and South America

46. Firm-Level Access To International Capital Markets: Evidence From Chilean Equities

Author:: Francis E. Warnock and Sara B. Holland
Publication Date:: 01-2003
Content Type:: Working Paper
Institution:: Board of Governors of the Federal Reserve System
Abstract:: High growth, liquid Chilean firms have greater relative weights in U.S. equity portfolios, but the most important determinant of a firm's portfolio weight is whether it is listed on a U.S. exchange. Cross-listing does not, however, appear to have permanent benefits: Weights in U.S. portfolios of firms that cross-listed in the mid-1990s increased at the expense of firms that cross-listed earlier. Put another way, firms appear to be able to access international capital at the time of the cross-listing, but this access may well be short-lived.
Topic:: International Relations, Economics, and International Trade and Finance
Political Geography:: South America

47. A Resurgent MERCOSUR: Confronting Economic Crises and Negotiating Trade Agreements

Author:: Thomas Andrew O'Keefe
Publication Date:: 02-2003
Content Type:: Working Paper
Institution:: The North-South Center, University of Miami
Abstract:: Almost from the day it was launched on March 26, 1991, skeptics have predicted the imminent collapse of the Common Market of the South (Mercado Común del Sur — MERCOSUR), while some economists have fretted about the project's supposed protectionist designs to create a trade fortress. The most memorable example of the latter was a 1996 report written by a World Bank economist that relied on out-of-date trade statistics and attributed to MERCOSUR policies that were actually pre-existing national automotive regimes. More recent tirades have tried to blame Argentina's economic meltdown on its MERCOSUR membership. A well-known economist from a New York City investment bank has even gone as far as to proclaim MERCOSUR dead. Given all the invective directed against efforts to integrate South America's Southern Cone economically over the past decade, it is not surprising that MERCOSUR is misunderstood by many in North America.
Topic:: Economics, International Trade and Finance, and Treaties and Agreements
Political Geography:: South America, Latin America, and North America

48. Unemployment Protection in Chile

Author:: Wayne Vroman
Publication Date:: 08-2003
Content Type:: Working Paper
Institution:: Urban Institute
Abstract:: Interruptions of earnings caused by unemployment and reductions in the real value of earnings caused by inflation are two important risks that face persons active in the labor market. The following paragraphs discuss these phenomena and the possible mechanisms for addressing the risks that they pose.
Topic:: Economics, Government, and Human Welfare
Political Geography:: South America, Latin America, and Chile

49. The Gender Impact of Pension Reform in Latin America—and Broader Policy Implications

Author:: Estelle James, Alejandra Cox Edwards, and Rebeca Wong
Publication Date:: 06-2003
Content Type:: Working Paper
Institution:: Urban Institute
Abstract:: Over the past two decades multipillar pension systems that include both a public defined benefit (DB) and private defined contribution (DC) pillar have been adopted in many countries. Critics of these pension reforms argue that the tight link between payroll contributions and benefits in the DC pillar will produce lower pensions for women. In contrast, supporters of these reforms argue that multipillar systems remove distortions that favored men and permit a more targeted public pillar that will help women. To test these conflicting claims about multipillar reforms, and to analyze more generally the gender impact of alternative pension systems, this paper examines the differential impact on the two genders of the new and old systems in three Latin American countries—Chile, Argentina, and Mexico. On the basis of household survey data, we simulate the employment histories of representative men and women and the pensions that these are likely to generate under the new and old rules.
Topic:: Economics, Gender Issues, and Human Welfare
Political Geography:: Argentina, South America, Latin America, Central America, North America, Mexico, and Chile

50. Are Neighbours Equal? Estimating Local Inequality in Three Developing Countries

Author:: Chris Elbers, Peter Lanjouw, Johan Mistiaen, Berk Ozler, and Ken Simler
Publication Date:: 07-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Based on a statistical procedure that combines household survey data with population census data, this paper presents estimates of inequality for three developing countries at a level of disaggregation far below that allowed by household surveys alone. We show that while the share of within-community inequality in overall inequality is high, this does not necessarily imply that all communities in a given country are as unequal as the country as a whole. In fact, in all three countries there is considerable variation in inequality across communities. We also show that economic inequality is strongly correlated with geography, even after controlling for basic demographic and economic conditions.
Topic:: Development and Economics
Political Geography:: Africa and South America

51. Picking Up the Pieces: Comparing the Social Impact of Finacial Crisis in Mexico and Argentina

Author:: Manuel Pastor and Carol Wise
Publication Date:: 10-2003
Content Type:: Working Paper
Institution:: Center for International Studies, University of Southern California
Abstract:: After a committed process of macroeconomic stabilization that began during the mid-1980s in most of Latin America, many observers began to speak of the need for a “second generation” of reforms that could more firmly establish the bases for economic growth and correct for longstanding distributional inequities. By the mid-1990s serious reformers like Argentina and Mexico seemed to be on the cusp of tackling this distributional backlog by launching so-called second phase market reforms meant to correct for earlier shortcomings in the social realm (Naím 1995; Pastor and Wise 1999). However, in both cases, financial crises erupted: Mexico's crash of December 1994, which saw a forty percent devaluation of the peso and a massive outflow of portfolio capital; and, more recently, Argentina's 2002 meltdown, which while simmering since the Brazilian devaluation of 1999, finally caused the country's commitment to a fixed exchange rate to be abandoned.
Topic:: Economics and Government
Political Geography:: Brazil, Argentina, South America, Latin America, North America, and Mexico

52. The Bombardier-Embraer Dispute and its Implications for Western Hemisphere Integration

Author:: Jonathan P. Doh
Publication Date:: 12-2003
Content Type:: Working Paper
Institution:: Center for Strategic and International Studies
Abstract:: Government subsidies are a pervasive problem for international trade and economic development. Subsidies distort investment decisions, generally squander scarce public resources, skew public expenditures toward unproductive uses, unfairly discriminate against efficient industries and firms, and prompt wasteful overconsumption of some products over others. Despite efforts to limit subsidies through trade and investment policy disciplines, subsidization remains a constant on the global trade policy and international business landscape.
Topic:: Economics, International Trade and Finance, and Treaties and Agreements
Political Geography:: South America, Latin America, Central America, Caribbean, and North America

53. Employment-Poverty Linkages and Policies: The Case of Bolivia

Author:: Luis Carlos Jemio and Maria del Carmen Choque
Publication Date:: 11-2003
Content Type:: Working Paper
Institution:: Institute for Advanced Development Studies (INESAD)
Abstract:: This study focuses on analysing the linkages between output growth, employment and poverty, at both the macro and micro levels. At the macro level, the linkage between poverty and output growth is conceptualised in terms of the average productivity of the employed work force, which in turn gets reflected in low levels of real wages and low levels of earnings in self-employment. At the micro level of a household, the same linkage between poverty and employment operates through the type and productivity of economic activities in which the earning members of a household are engaged, the low level of human capital of the members of the workforce, the dependency burden that limits participation in the workforce, and the availability of remunerative employment.
Topic:: Development, Economics, Poverty, Labor Issues, and Employment
Political Geography:: South America and Bolivia

54. Social Insurance Regimes: crises and 'reform' in the Argentine and Brazil, since c. 1900

Author:: Colin Lewis and Peter Lloyd-Sherlock
Publication Date:: 01-2002
Content Type:: Working Paper
Abstract:: The paper examines the structural and organisational problems of social insurance systems in Brazil and the Argentine in order to illuminate current debates about pension 'reform'. Much of the present discussion depicts social insurance 'crisis' as a modern phenomenon. Similarly, preoccupations about the macroeconomic objectives of reform - profitable pension funds as an adjunct to capital market deepening, about sustainability - the financial viability of systems, and about equity and coverage, are often assumed to be peculiar to the late twentieth century. The papers stresses the generational (or cyclical) nature of crises that have plagued social insurance regimes in both countries. It also identifies what may be learnt from differences, as well as similarities, between the two systems - not least the relatively larger historic role the private sector and earlier substantive provision for rural workers in Brazil. Following an appraisal of different 'models' (individual 'capitalised' accounts versus pay-as-you-go schemes and monopolistic state systems versus pluralistic/competitive arrangements), the paper concludes with an evaluation of the administrative and financial stability of current schemes.
Topic:: Economics, Government, and Industrial Policy
Political Geography:: Brazil, Argentina, South America, and Latin America

55. The Argentine Implosion

Author:: Luigi Manzetti
Publication Date:: 11-2002
Content Type:: Working Paper
Institution:: The North-South Center, University of Miami
Abstract:: In December 2001, Argentina recorded the world's largest default ever, as it failed to honor payments on its US$132 billion foreign debt. Since then, five presidents have been in power, the Argentine peso has been devalued by 120 percent, and the banking system has virtually collapsed, dragging the economy into a depression. The gross domestic product (GDP) contracted 16.3 percent in the first quarter of 2002. Argentina's per capita income has become one of the worst in Latin America, and, as a result, more than one-third of its people live under the poverty line. 1 Argentines' confidence in their elected officials has disappeared. By most accounts, the country has literally imploded to a degree that has no precedent in Latin America's contemporary history. This is particularly bewildering, considering that only 10 years ago Argentina was hailed around the world as a model of successful economic reforms, with standards of living that were not only the highest in the region but comparable to those of some southern European countries. How could Argentina go from role model to international outcast so quickly? Some place the blame on external shocks created by the financial crises in Mexico (1995), Indonesia (1997), Thailand (1998), and Russia (1998). Others say the cause of the problem was misguided policy advice from the International Monetary Fund (Stiglitz 2002). Yet, most analyses ascribe much of the trouble to the Convertibility Law's fixed exchange rate policy adopted in 1991.
Topic:: Economics, Government, and International Trade and Finance
Political Geography:: Russia, Indonesia, Argentina, South America, Latin America, Mexico, and Thailand

56. Fixing Argentina

Author:: Kurt Schuler
Publication Date:: 07-2002
Content Type:: Working Paper
Institution:: The Cato Institute
Abstract:: Argentina's currency crisis and economic depression have been caused by the bad policies of its government—not by banks, speculators, the International Monetary Fund (despite the bad advice it has given), or other scapegoats. The De la Rúa and Duhalde governments have made several gigantic blunders, namely, increasing tax rates, freezing bank deposits, devaluing the peso, and forcibly converting dollar bank deposits and contracts into pesos (“pesofication”).
Topic:: Economics, Globalization, and Political Economy
Political Geography:: Argentina, South America, and Latin America

57. Financial Regulation and Supervision in Emerging Markets. The Experience of Latin America since the Tequila Crisis

Author:: Barbara Stallings and Rogerio Studart
Publication Date:: 04-2002
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The paper deals with changes in the regulation and supervision of the Latin American financial sector in the aftermath of the 'Tequila Crisis' of 1994–95. While it finds that both have improved, regulation and supervision cannot resolve all problems; good macroeconomic policy and performance are essential complements. This is especially true because of the procyclical nature of financial activity. The paper presents both regional data for Latin America, contrasting it with other emerging markets, and four country case studies (Argentina, Brazil, Chile, and Mexico). The latter show how individual country characteristics and experiences affect the operation of the financial systems. We close with some policy recommendations.
Topic:: Economics, Emerging Markets, and Government
Political Geography:: Brazil, Argentina, South America, Latin America, North America, Mexico, and Chile

58. Non-Financial Corporate Risk Management and Exchange Rate Volatility in Latin America

Author:: Graciela Moguillansky
Publication Date:: 03-2002
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This article studies the currency risk management of multinational companies with investments in Latin American countries. The analysis is centred on episodes of currency or financial shocks, searching into the behaviour of the financial management of a firm expecting a significant devaluation. This allowed us to explore the interaction and transmission mechanisms between the microeconomic behaviour and the macroeconomic impact on the foreign exchange market. The analysis was carried out interviewing financial managers of multinational companies from different sectors with headquarters in the United Kingdom and Spain, by reviewing literature on business and currency risk management, and by analysing some surveys on financial risk management in developed countries.
Topic:: Economics and International Trade and Finance
Political Geography:: United Kingdom, South America, Latin America, and Spain

59. U.S. Policy in the Andean Region

Author:: Michael Shifter
Publication Date:: 11-2002
Content Type:: Working Paper
Institution:: Aspen Institute
Abstract:: Even within Latin America's generally gloomy economic and political outlook, the countries of the Andean region—Colombia, Venezuela, Peru, Ecuador and Bolivia—stand out as especially problematic and unsettled. For the United States, this set of countries, with some 120 million citizens, poses enormous policy challenges. Fostering democracy, expanding trade, combating drugs, promoting stability, and advancing social development are just some of the challenges germane to this region which, in the context of globalization, post-September 11, become even more compelling.
Topic:: Foreign Policy, Economics, and Government
Political Geography:: United States, Colombia, South America, Latin America, Venezuela, Peru, Ecuador, and Bolivia

60. Toward A Sustainable FTAA: Does Latin America Meet The Necessary Financial Preconditions?

Author:: Liliana Rojas-Suarez
Publication Date:: 07-2002
Content Type:: Working Paper
Institution:: Peterson Institute for International Economics
Abstract:: This paper focuses on identifying preconditions that will ensure the sustainability of a Free Trade Area of the Americas (FTAA). It argues that the macro, micro, and political conditions advanced in the literature to measure a country's ability to compete internationally, while necessary, are not sufficient to ensure the success and permanence of a free trade agreement. Instead, two additional financial conditions are needed. The first is that each partner in the free trade area needs to have sustainable public debts as determined by the achievement of credible and sustainable structural fiscal balances. The second is that exchange rate regimes across trading partners should be compatible in the sense that adverse shocks in one country do not generate a policy dilemma in other partners between abandoning their exchange rate system or the free trade area.
Topic:: Economics and International Trade and Finance
Political Geography:: South America, Latin America, Central America, and Caribbean

61. Small Producer Deforestation in the Brazilian Amazon: Integrating Household Structure and Economic Circumstance in Behavioral Explanation

Author:: Marcellus Caldas, Robert Walker, and Stephen Perz
Publication Date:: 10-2002
Content Type:: Working Paper
Institution:: The John F. Kennedy School of Government at Harvard University
Abstract:: This study examines the impact household structure and economic circumstances on deforestation in the Brazilian Amazon. It presents the results of an analysis conducted at property level, using both survey data and information derived from remote sensing. Regression analyses and spatial autocorrelation tests are given, following a theoretical development integrating notions of the household economy with von Thünen. The results from the empirical model indicate that social and demographic characteristics of households, as well as institutional and market factors, affect land use decisions. Thus, aggregate studies and spatially explicit models that do not include household information may be subject to specification bias.
Topic:: Economics, Deforestation, Remote Sensing, and Behavioral Modeling
Political Geography:: Brazil, South America, and Amazon Basin

62. Protest and Collaboration: Transnational Civil Society Networks and the Politics of Summitry and Free Trade in the Americas

Author:: Patricio Korzeniewicz and William C. Smith
Publication Date:: 09-2001
Content Type:: Working Paper
Institution:: The North-South Center, University of Miami
Abstract:: This paper examines the politics of hemispheric integration exemplified by the Summits of the Americas held in Miami (1994), Santiago (1998), and Quebec (2001) and the negotiations over the creation of a Free Trade Area of the Americas (FTAA). Our basic premise is that political and institutional arrangements articulating state, society, and economy in Latin America are currently in the midst of a process of reconfiguration unleashed by the acceleration of globalization and attendant crises of state-centered development strategies. More specifically, we believe the Americas are witnessing the emergence of an ensemble of new social and political actors, among the most salient of which are new social movements and civil society organizations (CSOs), organized in networks operating at the domestic, regional, and global levels.
Topic:: Economics, International Trade and Finance, and Political Economy
Political Geography:: United States, America, South America, Latin America, Central America, Caribbean, North America, and Miami

63. The Impact of MERCOSUR on the Automobile Industry

Author:: Jerry Haar and Thomas A. O'Keefe
Publication Date:: 09-2001
Content Type:: Working Paper
Institution:: The North-South Center, University of Miami
Abstract:: A transformation of the automotive industry, particularly the segment involved in production of finished vehicles, has taken place in the Southern Common Market (Mercado Común del Sur/Mercado Comum do Sul—MERCOSUR/MER-COSUL) region of South America, at a time when MERCOSUR member states opened their economies to global competition and to participation in an ambitious subregional economic integration project. This Agenda Paper provides an overview of the factors that have contributed to this recent industry transformation. The paper also examines the factors involved in the formal incorporation of the automotive sector into the MERCOSUR project and discusses the impact this development is like-ly have on the subregional automobile industry,
Topic:: Economics, International Trade and Finance, and Political Economy
Political Geography:: United States, South America, Latin America, and North America

64. Preferential Treatment in Trade: Is There Any Room Left in the Americas?

Author:: Fernando Masi
Publication Date:: 08-2001
Content Type:: Working Paper
Institution:: The North-South Center, University of Miami
Abstract:: This paper evaluates the costs and benefits of changes brought by the Uruguay Round of the General Agreement on Tariffs and Trade (GATT) on special and differential treatment (S); shows how these changes affected the new regional integration processes in the American continent; and examines whether this issue is still a priority of developing countries' agendas. Large concessions offered by developing countries in exchange for access to markets automatically led to “trade graduation.” Thus, S has lost its former significance among developing countries. Moreover, nonreciprocal treatment was retained for least developed countries, which do not even enjoy this type of treatment under the so-called “new trade-related issues” of services, investment, and intellectual property rights.
Topic:: Economics, International Trade and Finance, and Political Economy
Political Geography:: United States, America, South America, Latin America, Central America, Caribbean, and North America

65. Democratizing U.S. Trade Policy

Author:: Pat Choate and Bruce Stokes
Publication Date:: 11-2001
Content Type:: Working Paper
Institution:: Council on Foreign Relations
Abstract:: Storm clouds signaling trouble with American trade policy have been gathering for some time. In the early 1990s, Congress barely approved creation of the North American Free Trade Agreement (NAFTA), and only strenuous efforts by the Clinton administration and the business community ensured passage of legislation creating the World Trade Organization (WTO). In the late 1990s, President Clinton twice failed to obtain congressional renewal of his trade-negotiating authority. The massive demonstrations during the meeting of the world's trade ministers in Seattle in 1999 reflected a widespread public unease with the impact of trade policy on a range of issues, from clear-cutting practices in the forests of Indonesia to the price of AIDS drugs in southern Africa. Today, public opinion polls consistently demonstrate that, although the American public supports freer trade in theory, it often has profound reservations about trade liberalization in practice. And the current global economic slowdown may only further polarize public opinion on trade issues.
Topic:: Economics, Government, and International Trade and Finance
Political Geography:: United States, Indonesia, South America, and North America

66. Reducing Urban and Industrial Pollution in Chile

Author:: Joseph M. Lieberson, Mark G. Hodges, and Gene M. Owens
Publication Date:: 12-2000
Content Type:: Working Paper
Institution:: United States Agency for International Development
Abstract:: In Chile's capital of Santiago, the summer sun rises over a hazy, smog-filled sky. The sky darkens as the day progresses and often turns a light brown. In winter, air quality is even worse, and visibility drops sharply. A ring of mountains and thermal inversions trap pollution in a choking cloud over the city. But the mountains and air currents are not the whole problem. Twenty years ago the air was relatively clean. That was before economic growth accelerated sharply. A rapid increase in industrial production and a major increase in truck, bus, and automobile traffic are all pumping pollutants into the air. The result is a high level of respiratory problems, sickness, and premature death.
Topic:: Economics, Environment, Human Welfare, and Science and Technology
Political Geography:: South America, Latin America, and Chile

67. Urban Violence in São Paulo

Author:: Nancy Cardia
Publication Date:: 03-2000
Content Type:: Working Paper
Institution:: The Wilson Center
Abstract:: Today homicide is the highest cause of death of young people in Brazil. Nancy Cardia, senior researcher at the University of São Paulo's Center for the Study of Violence, examines urban violence in São Paulo arguing that violence has become a major public health problem.
Topic:: Conflict Resolution, Development, Economics, Human Welfare, and Industrial Policy
Political Geography:: South America and Latin America

68. Governance, Urban Environment, and the Growing Role of Civil Society

Author:: María Elena Ducci
Publication Date:: 03-2000
Content Type:: Working Paper
Institution:: The Wilson Center
Abstract:: In urban areas in developing countries, the current experience indicates that well organized and well-informed citizens have become the best motors for positive change within cities and it is the state that has fallen out of touch, in spite of constant declarations about the importance of citizens' participation. María Elena Ducci explains how in Latin America, the urban social movements that focused on the fight for land and housing from the sixties to the eighties today have become citizens' groups seeking to maintain and improve quality of life. Once again, territory has become the focus for city inhabitants who are discovering new ways of being social and becoming the political protagonists of their own lives in the city. According to Ducci, the dynamic of urban politics is changing as these new players—the citizens' groups that are defending their urban environment—come to the fore with enormous strength and energy. They oppose and block public and private urban projects of enormous scope, which raises costs and lengthens time frames for the companies involved. This paper focuses on how these groups, which demand a better quality of life and more equality, are working in an increasingly globalized and polarized city.
Topic:: Civil Society, Economics, Environment, Government, and Industrial Policy
Political Geography:: South America and Latin America

69. The 'Labour Question' in Nineteenth Century Brazil: Railways, Export Agriculture and Labour Scarcity

Author:: Lucia Lamounier
Publication Date:: 10-2000
Content Type:: Working Paper
Abstract:: This paper examines changing patterns of labour relations in nineteenth-century Brazil associated with the building of railways and expansion of export agriculture. It addresses the 1850s-1880s period, decades when the `labour question' became a pressing issue for contemporaries. The extinction of the trans-Atlantic slave trade in 1850 posed the problem of finding alternative supplies of labour at a time of increasing agro-export production. In 1852 effective action to start the building of railways was taken. As part of efforts to improve conditions in the sugar and coffee sectors, several concessions were approved. From the middle of the century through to the 1870s, the expansion of coffee cultivation and railway construction were closely inter-related phenomena in the southern provinces of Brazil and shaped the debate about labour. The 1870s was a key decade. First, these years witnessed a `railway mania' - a great fever of building new lines and branches in various regions of the country, especially in the new coffee districts. Second, concern about the labour question intensified with the approval in 1871 of the Rio Branco Law which provided for the gradual emancipation of slaves. From then until 1888, when slavery was finally abolished, several policies were implemented trying to solve the problem of labour supply and to set new patterns of labour relations. This involved the arrival of thousands of immigrants in the 1880s, imported with government aid, to support the near-continuous expansion of coffee cultivation.
Topic:: Economics, Industrial Policy, and International Trade and Finance
Political Geography:: Brazil and South America

70. Growth, Poverty and Inequality in Latin America

Author:: William Smith and Roberto Korzeniewicz
Publication Date:: 05-1999
Content Type:: Working Paper
Institution:: Institute for Latin American and Iberian Studies at Columbia University
Abstract:: The crystallization of the so-called “Washington Consensus” in the late 1980s sparked intense debates regarding the likely social impact of macroeconomic stabilization and structural adjustment. Academic critics and political opponents argued that Washingtonian reforms, and neoclassical economics more broadly, lacked a coherent theory of growth, and were bound to result in long-term negative trends in popular welfare and social inequality. Advocates of neoliberal restructuring, in contrast, while recognizing that market-oriented reforms could lead initially to a decline in output and standards of living, were confident that these reforms eventually would lead to sustainable growth and, as a consequence, greater equality and enhanced social welfare. A decade later we revisit this debate to evaluate recent trends in economic growth, poverty and inequality, and to assess accompanying shifts in the theoretical, policy, and political terrains.
Topic:: Development and Economics
Political Geography:: Washington, South America, Latin America, Central America, and Caribbean

71. Challenging Traditional Participation in Brazil: The Goals of Participatory Budgeting

Author:: Pedro Jacobi
Publication Date:: 06-1999
Content Type:: Working Paper
Institution:: The Wilson Center
Abstract:: Using the mechanism of “participatory budgeting” implemented in the city of Porto Alegre, Pedro Jacobi analyses a new practice of resource allocation in several Brazilian urban areas. He comes to the conclusion that participatory budgeting is an effective tool in the democratization of the city's management— helping to break old patterns of clientelist relations. According to Jacobi, the new mechanism promotes decentralization of municipal decision-making and increases public control over the city's investment policies.
Topic:: Economics, Human Welfare, and Industrial Policy
Political Geography:: South America and Latin America

72. Development Discontinuities: Leaders and Intermediaries in Producers' Associations

Author:: Tito Bianchi
Publication Date:: 10-1999
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The development literature considers associations an important economic development tool that allows producers to pursue their economic welfare collectively and through participatory means. This paper comparatively analyses the experience of three associations of agricultural producers in the underdeveloped regions of Brazil and Italy that were successful in this economic development task. Their experience, however, challenges a commonly held view about the participatory nature of associations.
Topic:: Development and Economics
Political Geography:: Europe, Brazil, South America, and Latin America

73. Negotiating Economic Transitions in Liberizing Polities

Author:: Frances Hagopian
Publication Date:: 05-1998
Content Type:: Working Paper
Institution:: Weatherhead Center for International Affairs, Harvard University
Abstract:: How do governments struggling to consolidate new democracies enact effective stabilization and adjustment policies, reform the public sector, and deregulate markets? And what has been the impact of economic liberalization on political institutions and systems of political representation? Treating economic and political transitions as mutually interdependent, this paper couples these questions to suggest a reformulation of the conventional wisdom about how economic liberalization proceeds and how political interests are determined. It challenges the assumption that neoliberal reform is most readily achieved in liberalizing polities when visionary political leaders surrounded by coherent economic teams with comprehensive programs in place act with a wide margin of autonomy from society. It also questions the contention that structures of political representation are the outgrowth of either economic organization or the product of state engineering. The paper makes two arguments. Its central argument is that economic reform is accomplished most readily when government reformers, acting through available clientelistic, corporatist, and party-based networks of mediation, negotiate the compliance of public and private sector representatives of social actors for the introduction of market-oriented reforms. They trade public resources or legislation favoring the representational status of political or social actors in the present for the agreement of those actors to accept diminished state resources for their organizations or constituents in the future. The use of specific networks of negotiation, moreover, influences the design of liberalization policies and helps to account for national differences in the pace and sequence of economic reform measures. The paper's second argument is that those systems of political representation that are strengthened as a result of the temporary advantages that accrue to them during the process of state retreat will endure even when they are incompatible with economic liberalism. This is so because the politicians and group leaders who manage these networks have the opportunity to design institutions that will allow them to accommodate themselves and adapt their power bases to economies in which the market plays a larger role.
Topic:: Economics and Political Economy
Political Geography:: South America, Latin America, Central America, and North America

74. Open Regionalism: Lessons from Latin America for East Asia

Author:: Clark Winton Reynolds
Publication Date:: 08-1997
Content Type:: Working Paper
Institution:: Kellogg Institute for International Studies
Abstract:: The process of regional integration is part of the reshaping of the international economic order at the end of the 20th century. Much if it is impelled by raw market forces, or what one may term 'silent integration.' In this process the increasingly liberalized movement of goods and services, factors of production (capital, technology, and labor through migration and as embodied in trade in goods and services), and tastes offers new prospects and challenges. There are opportunities for major increases in income and wealth for the most intrepid, skilled, mobile, and aggressive participants in the process. There are threats of lost income, power, prestige, values, and institutions for those left behind. There is a need to go behind the impulse of market forces, taking advantage of their dynamic but finding ways to manage interdependence so as to best reconcile differences among social groups, institutions, and values to ensure that the process of liberalized exchange produces gains that are equitable, stable, and sustainable.
Topic:: Economics, International Organization, and International Political Economy
Political Geography:: Israel, East Asia, South America, and Latin America

75. Cato Institute's 15th Annual Monetary Conference

Author:: Anna J. Schwartz, Stanley Fischer, Jerry L. Jordan, Leland B. Yeager, Francisco Gil-Diaz, Roberto Salinas-Leon, A. James Meigs, Lawrence Kudlow, William A. Niskanen, Michael Prowse, and Bert Ely
Publication Date:: 10-1997
Content Type:: Working Paper
Institution:: The Cato Institute
Abstract:: On Tuesday, October 15, 1997 the Cato Institute continued its 15 year tradition of exploring pressing and timely issues in international fiscal policy with its meeting Money and Capital Flows in a Global Economy. Speakers including Federal Reserve Chairman, Alan Greenspan; First Deputy Managing Director of the International Monetary Fund, Stanley Fisher; and the Bank of Mexico's Vice Governor, Francisco Gil-Díaz, convened to sort through the pressing issues relevant to global capital flows that face the world economy.
Topic:: Economics, Globalization, and International Political Economy
Political Geography:: South America, Latin America, North America, Mexico, and Nagasaki

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COLUMBIA UNIVERSITY PRESS