Latin American Development Forum
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This series promotes debate and disseminates knowledge and analysis on economic and social development issues in Latin America and the Caribbean. Books in this series discuss economic growth, structural reforms, social security, globalization and its social effects, poverty reduction strategies, macroeconomic stability and capital flows, financial systems and market reforms, and more. Sponsored by the Inter-American Development Bank (IDB), the United Nations Economic Commission for Latin America and the Caribbean (ECLAC), and the World Bank, the series seeks to convey the excitement and complexity of the most topical issues in the region. Titles in this peer-reviewed series are selected for their relevance to the academic community and represent the highest quality research output of each institution.
Items in this collection
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Publication
Job Creation in Latin America : Recent Trends and Policy Challenges
(Washington, DC: World Bank and New York: Palgrave Macmillan, 2009)This book strives to better understand the recent labor market trends in the countries of the region and the factors that underlie the failure of many of those countries to create more, but especially more productive and rewarding jobs. In particular, the book addresses four main questions: how well are the Latin American and Caribbean economies doing in terms of growth and job creation compared with other emerging economies? The book shows that jobless growth concerns only a few Latin American and Caribbean countries. In most of the rest, many jobs have been created over the past decade, but their productivity and pay were low. Is the weak creation of productive jobs the result of lack of dynamism in the economy? To address this question, the book dives into the behavior of firms. In particular, it looks at how resources are reallocated across firms and sectors. This analysis uncovers that, in most countries of the region, many jobs are created and destroyed, but this activity does not necessarily lead to better allocation of labor to the most productive jobs. Many new and potentially productive firms are small and encounter difficulties in expanding. What are the constraints to productive job creation across different types of firms? The book exploits information from a large number of firms in Latin America and the Caribbean regarding their exposure to and the effect of different aspects of the business climate in the region. Particular emphasis is placed on assessing differences across small, medium, and large firms and, when available, contrasting the responses of formal and informal firms. The book shows that small firms tend to be more constrained by lack of access to finance, macroeconomic instability, competition from informal firms, and corruption, while large firms are hampered by an inappropriate regulatory environment. What is the relative importance of labor market policies in strengthening the creation of productive jobs in the countries of the region? Firms in the region seldom cite labor market regulations as a major concern, even though those regulations are relatively rigid from an international perspective. The book shows that this apparent lack of concern is mainly because other constraints to firms' operation and expansion are more pressing. It also suggests that as other constraints are lifted, inappropriate labor market regulations become a binding constraint. The book goes on to advocate rethinking social protection systems, shifting protection from jobs to workers, and advancing the design of social security programs and labor market policies. The overarching goals are to protect workers while fostering the creation of more and better jobs. -
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Does the Investment Climate Matter? Microeconomic Foundations of Growth in Latin America
(Washington, DC : The World Bank, 2009)This book aims to fill that gap by using extensive and new firm-level data. It provides an alternative, albeit complementary, approach to previous studies of the determinants of the region's growth performance, which are mostly based on cross-country regressions using aggregate data. This book uses the information contained in enterprise surveys performed in 16 Latin American and Caribbean countries, covering more than 10,000 firms. These data are complemented with information from household surveys, as well as from enterprise surveys performed in other regions of the world. The analysis in this volume covers topics that have also been stressed by other authors, such as the need to make progress in the areas of financial sector development, export promotion, and innovation policy. The book's contribution in this regard is to inform the corresponding policy debates with evidence on the effect of different policy environments on firm performance. Overall this book will contribute to identifying some of the underlying factors that are driving Latin America's lackluster growth performance. In particular, objective is to improve our understanding of the policies that could have a larger influence on increasing growth and productivity in the region, by means of improving the environment in which firms invest and operate. -
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China's and India's Challenge to Latin America : Opportunity or Threat?
(World Bank, 2009)China's and India's fast economic growth since 1990 is paralleled only by their growing presence in policy discussions throughout the Latin America and the Caribbean (LAC) region. The success of these Asian countries is looked upon with admiration, but there is also concern about the effects that growing Chinese and Indian exports may have on the manufacturing and service sectors throughout LAC. Blame for the private sector's poor performance in some LAC countries often falls on the growing presence of China, and to a lesser extent India, in world markets. The rest of this introduction is organized as follows: the next section summarizes the evidence on the positive aggregate effects of China's and India's growth in world trade markets, foreign direct investment (FDI) flows, and innovation activities on LAC economies, and is followed by a section presenting evidence on the effects of China's and India's growth within industries, concluding that negative effects are limited to certain manufacturing and service sectors, in particular in Mexico and to a lesser extent in Central America and the Caribbean. Next is a section that summarizes evidence of the effects of China's and India's growth on specialization patterns and factor adjustments, and actual and potential policy responses by LAC governments. The final section summarizes policy implications. -
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Measuring Inequality of Opportunities in Latin America and the Caribbean
(Washington, DC: World Bank, 2009)Over the past decade, faster growth and smarter social policy have reversed the trend in Latin America's poverty. Too slowly and insufficiently, but undeniably, the percentage of Latinos who are poor has at long last begun to fall. This has shifted the political and policy debates from poverty toward inequality, something to be expected in a region that exhibits the world's most regressive distribution of development outcomes such as income, land ownership, and educational achievement. This book is a breakthrough in the measurement of human opportunity. It builds sophisticated formulas to answer a rather simple question: how much influence do personal circumstances have on the access that children get to the basic services that are necessary for a productive life? Needless to say, producing a methodology to measure human opportunity, and applying it across countries in one region, is just a first step. On the one hand, technical discussions and scientific vetting will continue, and refinements will surely follow. On the other, applying the new tool to a single country will allow for adjustments that make the findings much more useful to its policy realities. And fascinating comparative lessons could be learned by measuring human opportunity in developed countries across, say, the states of the United States or the nations of Europe. But the main message this book delivers remains a powerful one: it is possible to make equity a central purpose, if not the very definition, of development. That is, perhaps, it's most important contribution. -
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The Impact of Private Sector Participation in Infrastructure : Lights, Shadows, and the Road Ahead
(Washington, DC : World Bank, 2008)As numerous countries in Latin America and the Caribbean and elsewhere are moving toward a second phase of private participation in infrastructure programs mostly through public-private partnership schemes and other countries are just beginning the process, several concerns remain from the outcomes of the first phase. These concerns are making governments cautious in moving forward. The Impact of private sector participation in infrastructure addresses these concerns and brings clarity to the debate on the impact of private participation in infrastructure. The assessment of this impact may be one of the most emotional policy issues in economics, as it is clouded in a mist of myths, perceptions, and reality. This book analyzes the impact and sorts out the truth from the myths. The authors take a systematic and hard look at the facts (i.e., data) in Latin America, where starting in the late 1980s, many governments brought private sector participation into the delivery of essential utilities services. Although there are many assessments of this experience, none was able to rely on systemic, cross-country, and time-series data, and practically all of them did not save rare exceptions account for what would have happened in the absence of interventions (the counterfactual). This book does just that. It brings together an all encompassing database from the 1980s to the first decade of this century and develops an effective and robust methodology, accounting for the counterfactual, which tests and estimates the impact of reform on an exceptionally wide set of outcome indicators. As a result, this book presents the most in-depth study to date of the private sector participation experience in Latin America, and it substantially advances the existing literature by offering robust econometric analysis. -
Publication
Remittances and Development : Lessons from Latin America
(Washington, DC: World Bank, 2008)There are four main messages that emerge from this book. First, no matter how authors look at the issue, remittances are extremely important in the Latin American context. With remittances estimated to have topped more than US$50 billion in 2006, Latin America is now the main destination of these flows. Second, remittances generate a number of important positive contributions to economic development. In particular, they tend to reduce poverty and inequality in recipient countries, as well as increase aggregate investment and growth. Third, even though remittances have a positive impact on the development indicators of the recipient economies, the magnitude of the estimated changes tends to be modest. Fourth, policy makers may take actions to enhance the development impact of remittances. One important message of this book is that the way countries benefit from remittances appears to be positively related to the countries' own institutional and macroeconomic environments. -
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Raising Student Learning in Latin America : The Challenge for the Twenty-First Century
(Washington, DC: World Bank, 2008)Improving student learning is the key challenge for education in Latin America and the Caribbean. This book is divided into three parts. Part one focuses on the central role of student learning in education. Chapter one examines why student learning outcomes are important. Chapter two analyzes the extent to which learning takes place in schools in the region. Chapter three discusses some of the advantages and disadvantages of generating and using information on student learning to raise the quality of education. Part two reviews the evidence on the factors and policies that affect student learning. It first presents a conceptual framework that facilitates understanding of the factors that influence student learning. It then reviews the evidence on the impact on student learning of economic, political, and social conditions (chapter four); student endowments and behaviors (chapter five); school endowments and behaviors (chapter six); and institutional factors and policies (chapter seven). Part three focuses on quality assurance and beyond. Chapter eight examines evidence from countries that have succeeded in achieving high levels of learning among most, if not all, students, in order to present policy options on education quality assurance. Chapter nine summarizes the book's main messages and discusses unanswered questions. -
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Fiscal Policy, Stabilization, and Growth : Prudence or Abstinence
(Washington, DC: World Bank, 2008)This volume covers the conduct of fiscal policy in Latin America, and its consequences for macroeconomic stability and long-term growth. The volume's chapters examine different aspects of these problems, ranging from the purely economic to the institutional and political economy dimensions. The book is organized as follows. This chapter offers an integrated overview of the themes covered in the rest of the volume. The chapter guides the reader through the rest of the volume, but it has been written as a self-standing essay for the benefit of those readers who may not have the time to indulge in the details of every chapter. The rest of the volume is organized in two parts. The first part deals with the pro-cyclical bias of fiscal policy, and the second part with the anti-investment bias of fiscal discipline -- popularly (albeit somewhat confusingly) known as the fiscal space problem. The rest of this introductory chapter consists of four sections. Section II examines recent trends in fiscal policy in the region and introduces the two main themes of the book. Sections III and IV present an overview of the topics covered in the two parts of the book, as well as the conclusions of the corresponding chapters. Section V summarizes the implications for future fiscal analysis and policy management. -
Publication
The State of State Reform in Latin America
(Palo Alto, CA : Stanford University Press, 2007)This book examines four major areas of institutional reform: a) political institutions and the state organization; b) fiscal institutions, such as budget, tax and decentralization institutions; c) public institutions in charge of sectoral economic policies (financial, industrial, and infrastructure); and d) social sector institutions (pensions, social protection, and education). In each of these areas, the authors summarize the reform objectives, describe and measure their scope, assess the main outcomes, and identify the obstacles for implementation, especially those of an institutional nature. -
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Investor Protection and Corporate Governance : Firm-Level Evidence Across Latin America
(Palo Alto, CA: Stanford University Press, 2007)This book holds that the crucial failure of corporate governance is the expropriation of outside investors, be they shareholders or creditors, by those who are in control of firms. The problem of expropriation, also known as tunneling, often takes on enormous proportions. Billions of dollars of wealth are siphoned away from outside investors to controlling shareholders and their private company allies. The expropriation prevents investors from devoting funds in the corporate sector, thus leading to low valuations of corporate assets, stunted capital markets, and slowed economic growth. Low valuations and underdeveloped financial markets are only two of the symptoms of investor expropriation. Other symptoms include concentrated corporate ownership, large spreads between cash flow ownership and the voting rights of dominant shareholders, pyramids, and low dividend payments. When financial markets exhibit these symptoms, the likely underlying problem is investor expropriation. The essays collected in this volume put together a compelling picture showing that many of the symptoms of investor expropriation and poor corporate governance are present in Latin America. The evidence is loud and clear in every chapter of this book. But there are also benefits to collecting this detailed proof. The evidence suggests recipes for improvement as well. The message of this book is as unambiguous as is its analysis: a critical goal in the agenda of financial reform in Latin America must be improvement in corporate governance through legal reform.