Publication: The Evolving Geography of Productivity and Employment: Ideas for Inclusive Growth through a Territorial Lens in Latin America and the Caribbean
Loading...
Files
2,442 downloads
1,757 downloads
3,575 downloads
1,446 downloads
417 downloads
23,347 downloads
769 downloads
Published
2024-01-25
ISSN
Date
2024-01-25
Author(s)
Editor(s)
Abstract
The Evolving Geography of Productivity and Employment: Ideas for Inclusive Growth through a Territorial Lens in Latin America and the Caribbean employs a territorial lens to understand the persistently low economic growth rates in Latin America and the Caribbean (LAC). Using new data and methods, it shows that deindustrialization, distance, and divisions offer intertwined explanations for an urban productivity paradox in the LAC region: its highly dense cities should be among the world’s most productive, yet they are not. LAC cities have been held back by lack of dynamism, poor connectivity, and divisions into disconnected poor and affluent neighborhoods.
Deindustrialization has shifted urban employment, especially in the largest LAC cities, away from manufacturing and toward less dynamic, low-productivity nontradable activities, such as retail trade and personal and other services, that profit less from agglomeration, especially in highly congested cities. Although employment in urban tradable services has risen, the increase has not been strong enough to offset the decline in manufacturing employment. Meanwhile, intercity connectivity issues have undermined the performance of the region’s network of cities by restricting market access and firms’ ability to benefit from specialization in smaller cities. Within cities, poor connectivity and residential labor market segregation have limited the gains from agglomeration to neighborhoods in central business districts where formal firms operate. Informality has persisted in low-income neighborhoods, where residents face multiple deprivations.
By contrast, many agricultural and mining areas have benefited from the strong demand for commodities by China and other fast-growing economies, particularly during the Golden Decade (2003–13), leading to a decline in territorial inequality in most countries in the region.
The report concludes that to encourage inclusive growth, countries must more efficiently transform natural wealth into human capital, infrastructure, and institutions and improve the competitiveness of the urban economy. It then sketches out the contours of such a development strategy, identifying policy priorities at the national, regional, and local levels.
Link to Data Set
Citation
“Ianchovichina, Elena. 2024. The Evolving Geography of Productivity and Employment: Ideas for Inclusive Growth through a Territorial Lens in Latin America and the Caribbean. World Bank Latin American and Caribbean Studies. © World Bank. http://hdl.handle.net/10986/40969 License: CC BY 3.0 IGO.”
Digital Object Identifier
Associated URLs
Associated content
Other publications in this report series
Journal
Journal Volume
Journal Issue
Related items
Showing items related by metadata.
Publication Spatial Inequality and Economic Development(World Bank, Washington, DC, 2008)Spatial inequality is an important feature of many developing countries that seems to increase with economic growth and development. At the same time, there seems to be little consensus on the causes of spatial inequality and on a list of effective policy instruments that may foster or reduce spatial inequality. This paper examines the theoretical and empirical literature on spatial inequality to learn what we know and do not know about the causes of spatial inequality, to investigate what policies may or may not ameliorate spatial inequality, and to determine whether policy makers can identify and implement policies that promote or reduce spatial inequality.Publication Reshaping Egypt's Economic Geography : Domestic Integration as a Development Platform(Washington, DC, 2012-06)This report investigates Egypt's regional economic growth, explores the causes for geographically unbalanced development, and proposes policy options to make unbalanced growth compatible with inclusive development. Regional disparities in income and consumption may be attributed to differences in natural endowments and geographical location, but unbalanced growth is mostly due to economies of scale, spillover effects, and the lower transaction costs that result from agglomeration. In Egypt, despite rapid progress in most welfare indicators in lagging regions, there are still substantial gaps in consumption and opportunities between growth poles and the rest of the country. Adopting integration as a development platform is not simple because spatial disparities are spanned in three dimensions: urban/rural dichotomies, the upper Egypt/lower Egypt duality, and the differences between large metropolises and the rest of the country. This typology of instruments underlies the menu of options presented in this report as the basis of domestic spatial integration as a development platform to achieve more balanced and equitable development without sacrificing growth. This report first identifies the gaps in consumption and in opportunities, showing the stark contrasts between regions and how they evolve through time. It then explores the causes of the gaps, revealing a multiplicity of factors and exposing the complexity of the problem. Finally, the bulk of the report presents the policy options to address the integration challenges.Publication Arab Republic of Egypt - Reshaping Egypt's Economic Geography : Domestic Integration as a Development Platform, Volume 1(Washington, DC, 2012-06)This report investigates Egypt's regional economic growth, explores the causes for geographically unbalanced development, and proposes policy options to make unbalanced growth compatible with inclusive development. In Egypt, despite rapid progress in most welfare indicators in lagging regions, there are still substantial gaps in consumption and opportunities between growth poles and the rest of the country. This report's central proposal is adopting spatial integration as a development platform, in which the policy focus shifts from spreading out industrial location to spreading out access to basic public services and facilitating factor mobility, which will make growth more inclusive and development more balanced in Egypt. Egypt's new political environment provides an opportunity to examine this perennial problem from a new perspective. Adopting integration as a development platform is not simple because spatial disparities are spanned in three dimensions: urban/rural dichotomies, the upper Egypt/lower Egypt duality, and the differences between large metropolises and the rest of the country. This report first identifies the gaps in consumption and in opportunities, showing the stark contrasts between regions and how they evolve through time. It then explores the causes of the gaps, revealing a multiplicity of factors and exposing the complexity of the problem. Finally, the bulk of the report presents the policy options to address the integration challenges.Publication Geography of Growth : Spatial Economics and Competitiveness(World Bank, 2012-04-20)This volume is organized as follows. Chapter one address two questions: how has spatial concentration evolved with growth and development, and what are the efficiency implications of too much or too little spatial concentration? This chapter summarizes the various models that analyze growth by geographic concentration and sets the foundation for concepts discussed in later chapters. Chapter two focuses on urbanization in geographies. Chapter three correlates urban presence with economic density in developed and developing countries. It initially focuses on how urban transition and growth are blurring the rural-urban divide and the unprecedented volume of people who are moving to urban areas. Chapter four discusses how different industries inhabit and impact various urban sectors. Chapter five contextualizes urban growth in the current technological landscape as innovation, particularly in information technology, has become critical to increasing productivity and consequently growth. Chapter six further analyzes urbanization in the current global context, specifically, the impact of globalization and industry clusters on urbanization. Chapter seven addresses a current fundamental global trend: why has urbanization been growing rapidly since the 1950s? Some theories suggest that it is industry that spurs urbanization and consequently growth in infrastructure; however this is not the case. Instead, the chapter concludes by looking at data across regions and cities, the municipalities are pivotal in influencing infrastructure development and growth in urban centers. Finally, chapter eight deciphers why some cities are more successful than others. Why do Karachi and Sao Paulo have the human capital that qualifies them as urban centers but not as thriving cities? By citing examples of successful cities, this chapter provides policy recommendations on how to make a city competitive in today's economy.Publication Toward an Urban Sector Strategy : Georgia's Evolving Urban System and its Challenges(Washington, DC, 2013-02-03)This review analyzes the profile, trends and challenges of Georgia's changing urban landscape since independence in 1991 and provides policy suggestions to facilitate the economic transition of the country through its cities. In its analysis and subsequent recommendations on policy interventions, this report draws on a program of diagnostics called the 'Urbanization Review' (UR). The UR diagnostic is based on three main pillars of urban development which have emerged as key areas of policy engagement for successful cities. These are: a) planning, charting a course for cities by setting the terms of urbanization, especially policies for using urban land and expanding basic infrastructure and public services; b) connecting, physically linking people to jobs, and businesses to markets; and c) financing, raising and leveraging up-front capital to meet the increasing demand for infrastructure and services. In moving forward, the review recommends that Georgia focus on: a) developing a national urban strategy that recognizes the contribution of each city to the overall economy, i.e. a 'systems of cities' approach that can assist in reducing regional disparities; b) assisting cities to develop urban plans, including local economic development plans, c) reforming building and planning codes; and d) assisting cities in improving their local governance and finances.
Users also downloaded
Showing related downloaded files
Publication World Development Report 2025: Standards for Development(Washington, DC: World Bank, 2025-12-11)Standards make everyday life run smoothly. You rarely notice them: the credit card that works in any corner of the world, the Wi-Fi signal that connects a remote village to the cloud, or the vaccine vial that fits syringes from Dakar to Delhi. When standards work, they build trust. They free people and firms to focus on creating, trading, and innovating, confident that the systems around them will hold. When standards fail, the effects are immediate and draining. Payments are declined, signals drop, vaccines spoil—and instead of being productive, people spend their energy just meeting their basic needs. Standards, in short, are the hidden infrastructure of modern economies—and they have never been more important. Developing countries today must contend with a thicket of increasingly stringent international standards, a product of globalization and rapid technological change. Using standards—and shaping them—is now a prerequisite for export growth, technology diffusion, and the efficient delivery of public services. Yet standards are too often overlooked by policy makers, especially in developing countries. World Development Report 2025: Standards for Development provides the most comprehensive assessment of the global landscape of standards today and how they can be used to accelerate economic development. It offers a practical framework for countries at all stages of development. Countries at the earliest stage should adapt international standards to suit local conditions when needed, whereas at more advanced stages, they should aim to align domestic markets with international standards. Meanwhile, all countries should author international standards in priority areas.Publication World Development Report 2024(Washington, DC: World Bank, 2024-08-01)Middle-income countries are in a race against time. Many of them have done well since the 1990s to escape low-income levels and eradicate extreme poverty, leading to the perception that the last three decades have been great for development. But the ambition of the more than 100 economies with incomes per capita between US$1,100 and US$14,000 is to reach high-income status within the next generation. When assessed against this goal, their record is discouraging. Since the 1970s, income per capita in the median middle-income country has stagnated at less than a tenth of the US level. With aging populations, growing protectionism, and escalating pressures to speed up the energy transition, today’s middle-income economies face ever more daunting odds. To become advanced economies despite the growing headwinds, they will have to make miracles. Drawing on the development experience and advances in economic analysis since the 1950s, World Development Report 2024 identifies pathways for developing economies to avoid the “middle-income trap.” It points to the need for not one but two transitions for those at the middle-income level: the first from investment to infusion and the second from infusion to innovation. Governments in lower-middle-income countries must drop the habit of repeating the same investment-driven strategies and work instead to infuse modern technologies and successful business processes from around the world into their economies. This requires reshaping large swaths of those economies into globally competitive suppliers of goods and services. Upper-middle-income countries that have mastered infusion can accelerate the shift to innovation—not just borrowing ideas from the global frontiers of technology but also beginning to push the frontiers outward. This requires restructuring enterprise, work, and energy use once again, with an even greater emphasis on economic freedom, social mobility, and political contestability. Neither transition is automatic. The handful of economies that made speedy transitions from middle- to high-income status have encouraged enterprise by disciplining powerful incumbents, developed talent by rewarding merit, and capitalized on crises to alter policies and institutions that no longer suit the purposes they were once designed to serve. Today’s middle-income countries will have to do the same.Publication World Development Report 2023: Migrants, Refugees, and Societies(Washington, DC : World Bank, 2023-04-25)Migration is a development challenge. About 184 million people—2.3 percent of the world’s population—live outside of their country of nationality. Almost half of them are in low- and middle-income countries. But what lies ahead? As the world struggles to cope with global economic imbalances, diverging demographic trends, and climate change, migration will become a necessity in the decades to come for countries at all levels of income. If managed well, migration can be a force for prosperity and can help achieve the United Nations’ Sustainable Development Goals. World Development Report 2023 proposes an innovative approach to maximize the development impacts of cross-border movements on both destination and origin countries and on migrants and refugees themselves. The framework it offers, drawn from labor economics and international law, rests on a “Match and Motive Matrix” that focuses on two factors: how closely migrants’ skills and attributes match the needs of destination countries and what motives underlie their movements. This approach enables policy makers to distinguish between different types of movements and to design migration policies for each. International cooperation will be critical to the effective management of migration.Publication Reboot Development: The Economics of a Livable Planet(Washington, DC: World Bank, 2025-09-01)“Reboot Development: The Economics of a Livable Planet” explores how the foundational natural endowments of land, air, and water—long taken for granted—are under growing threat, putting at risk the very progress they helped create. For generations, natural resources have powered development, supporting health, food, energy, and economic opportunity. Today, strains on these resources are intensifying. This report argues that failing to maintain a livable planet is not merely a distant environmental concern, but a present economic threat. Drawing on new data, the report shows that over 90 percent of the world is exposed to poor air quality, degraded land, or water stress. Loss of forests cuts rainfall, dries soils, and worsens droughts, costing billions of dollars. The nitrogen paradox emerges—fertilizers boost yields but overuse in some regions harms crops and ecosystems. Meanwhile, air and water pollution silently damage health, productivity, and cognition, sapping human potential. The report warns that these hidden costs are too large to ignore. Yet the message is not one of constraint but of possibility. Nature, when wisely stewarded, can drive growth, create jobs, and build resilience. The report shows that more efficient resource use—like better nitrogen management and forest restoration—yields benefits that far exceed the costs. It also urges a shift to cleaner sectors and producing “better things,” noting that these provide new sources of growth, creating more jobs per dollar invested. The findings are clear: Investing in nature is not only good for the planet, it is smart development.Publication The Government Analytics Handbook(Washington, DC: World Bank, 2023-09-28)The Government Analytics Handbook presents frontier evidence and practitioner insights on how to leverage data to strengthen public administration. Covering a range of microdata sources—such as administrative data and public servant surveys—as well as tools and resources for undertaking the analytics, it transforms the ability of governments to take a data-informed approach to diagnose and improve how public organizations work. The "Handbook" is a must-have for practitioners, policy makers, academics, and government agencies. It is available as a single volume in print or digital formats, and as chapters for modular use. Additional tools, data and background information are available at worldbank.org/governmentanalytics. “Governments have long been assessed using aggregate governance indicators, giving us little insight into their diversity and how they can practically be improved. This pioneering handbook shows how microdata can be used to give scholars and practitioners granular and real insights into how states work, and practical guidance on the process of state-building.” —Francis Fukuyama, Stanford University, author of State-Building: Governance and World Order in the 21st Century - "The Government Analytics Handbook is the most comprehensive work on practically building government administration I have ever seen, helping practitioners to change public administration for the better.” —Francisco Gaetani, Special Secretary for State Transformation, Government of Brazil - “The machinery of the state is central to a country’s prosperity. This handbook provides insights and methodological tools for creating a better shared understanding of the realities of a state, to support the redesign of institutions, and improve the quality of public administration.” —James Robinson, University of Chicago, coauthor of Why Nations Fail