Latin American Development Forum
40 items available
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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
Innovative Experiences in Access to Finance: Market-Friendly Roles for the Visible Hand?
(Washington, DC: World Bank, 2017-07-05)Interest in access to finance and awareness of its importance have increased significantly since the early 2000s. Growing evidence suggests that lack of access to credit prevents many households and firms from financing high-return investment projects, which has an adverse effect on growth and poverty alleviation. Despite the increasing awareness of the importance of access to finance among both researchers and policymakers, there are still some major gaps in our understanding of the main drivers of access, as well as about the impact of different policies in this area. This book aims to fill some of these gaps by discussing recent innovative experiences in broadening access to credit in Latin America. These experiences are consistent with an emerging new view that, while recognizing the central role of the public sector in improving the contractual and informational environment for financial markets, also contends that there might be room for well-designed, restricted interventions in collaboration with the private sector to foster the development of financial markets and broaden access to them. In particular, the book analyzes, among other things, some interesting experiences from Brazil, Chile, Colombia, and Mexico that use different instruments to broaden access to credit in a sustainable way, such as structured finance, factoring, credit guarantees, and correspondent banking. Most of these experiences have led to financial innovation by developing new financial products and coordinating different players in the financial and real sectors to overcome barriers to access to credit. The book provides a first systematic analysis of these innovative experiences, including an analytical framework to understand problems of access to finance and a discussion of the effects and optimal design of public interventions. Finally, the book discusses some open policy questions about the role of the private and public sectors (including state‐owned banks) in broadening access to finance in a sustainable and market-friendly manner. -
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Emerging Issues in Financial Development : Lessons from Latin America
(Washington, DC: World Bank, 2014)Since the 1990s, the financial systems in developing and developed countries have gained in soundness, depth, and diversity, prompted in part by a series of financial sector and macroeconomic reforms aimed at fostering a market-driven economy in which finance plays a central role. Latin America has been one of the regions at the forefront of these changes and offers a good laboratory of where the challenges in financial development lie. Despite all the gains in financial development, there is still a nagging contrast between the intensity of financial sector reforms implemented over the past 20 years in many countries and the actual size and depth of their financial systems. In the case of Latin America, in many respects it remains underdeveloped by international comparisons. This book studies in detail the recent history of financial sector development and reforms in Latin America, in comparison to other developing and developed countries, to shed light on the key obstacles for financial development. Rather than going in detail into sector-specific issues, the book focuses on the main architectural issues, overall perspectives, and interconnections. Its value added thus hinges on its holistic view of the development process, its broad coverage of the financial services industry (not just banking), its emphasis on comparisons and benchmarking, its systemic perspective, and its explicit effort to incorporate the lessons from the recent global financial crisis. The book is divided into three main parts. The first presents a stock taking exercise to ascertain where Latin America’s financial development lies—analyzing in more detail some of the reasons and policy implications underlying its banking depth and equity liquidity gaps. The second part revisits two themes that are central to the region’s financial development: long-term finance and the role of the state in risk bearing. The last part of the book deals with issues of regulation and supervision, first taking stock of the progress in the region and then analyzing the challenges faced by Latin America as regards three main facets of systemic oversight: macro-prudential policy, micro-systemic regulation, and systemic supervision. The chapters in this book yield many lessons and raise several issues, constituting an invaluable read for practitioners, policymakers, experts, and students alike in both developed and developing countries. -
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Does What You Export Matter? In Search of Empirical Guidance for Industrial Policies
(Washington, DC: World Bank, 2012)Does the content of what economies export matter for development? And, if it does, can governments improve on the export basket that the market generates through the shaping of industrial policy? This book considers these questions by reviewing relevant literature and taking stock of what is known from conceptual, empirical, and policy viewpoints. A large literature answers affirmatively to the first question and suggests the characteristics that distinguish desirable exports. More prosaically, but no less controversially, goods which are intensive in unskilled labor are thought to promote 'pro-poor' or 'shared growth,' whereas those which are skilled-labor intensive are thought to generate positive externalities for society as a whole. Concerns about macroeconomic stability have led to a focus on the overall composition of the export basket. This book revisits many of these arguments conceptually and, wherever possible, imports heuristic approaches into frameworks where, as more familiar arguments, they can be held up to the light, rotated, and their facets examined for brilliance or flaws. Second, the book examines what emerges empirically as a basis for policy design. Specifically, given certain conceptual arguments in favor of public sector intervention, do available data and empirical methods allow for actually doing so with a high degree of confidence? In asking this question, the book assumes that policy makers are competent and seek to raise the welfare of their citizens. This assumption permits sidestepping the debate about whether government failures trump market failures generically: In this sense, the book attempts to 'give industrial policy a chance.' -
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Breeding Latin American Tigers : Operational Principles for Rehabilitating Industrial Policies
(Santiago, Chile: United Nations Economic Commission for Latin America and the Caribbean and Washington, DC: World Bank, 2011)The specific structure of the book is as follows: chapter one reviews the current situation of Latin America, which historically has been a laggard in economic performance. Chapter two introduces the first principle: the urgency of developing a medium- to long-term strategy for productive transformation based on industrial policies. Chapter three focuses on the principle that strategies for productive transformation with modern industrial policies should rest on effective, locally grown public-private alliances. Chapter four introduces and illustrates principles 3-6, which focus on the 'how' of public sector leadership in the public-private alliance and the formulation and execution of strategies. Chapter five presents and illustrates principles 7-11, which are concerned with the public sector management of support programs and incentives. Chapter six shifts the focus to Latin America. It reviews the past and current nature of development strategies in the region, pointing to their strengths and weaknesses as tools for guiding productive transformation. In chapter seven, the author follow the path of principles 3-11 to critically evaluate the nature of public sector leadership in strategy execution and the modes for managing programs and incentives. Finally, chapter eight presents our central conclusions, which suggest that while some countries in Latin America have been planting the seeds of these 11 principles gleaned from our extra-regional success cases, they still have considerable work to do. -
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New Policies for Mandatory Defined Contribution Pensions : Industrial Organization Models and Investment Products
(World Bank, 2010)The recent financial crisis is challenging the reform approach to mandated pension a scheme that has emerged over recent decades across the world. This reform approach is characterized by a move toward multi-pillar pension systems and includes the creation or extension of a mandatory funded pillar with defined contribution design. The rationale and viability of such a pillar is contingent on an enabling environment and the delivery of high risk-adjusted net rates of return that beat the natural benchmark, which is the internal rate of return that an unfunded mandated scheme is able to achieve. Two key aspects of mandated and funded defined contribution schemes have been under discussion and investigation since dedicated pension funds were created: (a) the high fees levied by privately organized pension funds and the consequence for the net rate of return; and (b) the investment products of these funds and their capability to address the investment risks and to deliver the expected retirement income in a life-cycle context. To this end, country policies have experimented with a variety of approaches to improve outcomes with some important leads but overall modest results. This book proposes to take a fresh and highly innovative look at both policy issues. It suggests stepping back and looking at the underlying causes of the issues at stake instead of merely trying to address their symptoms. In addressing the high fees of pension funds, it focuses on the less-than-ideal conditions inert consumers facing firms with market powers and proposes to apply solutions derived from industrial organization models and pricing methods that better reflect the cost structure of the supply of pension services. In addressing the investment risks, it asks how to improve fund managers' risk-adjusted investment performance when participants are inert. -
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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. -
Publication
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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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. -
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. -
Publication
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.