A Note on the Labor Market Effects of Remittances in Latin American and Caribbean Countries: Do Thresholds Exist?

The labor market effects of remittances have long been examined in the empirical literature. To date, the results have been mixed: some authors observe a negative association between remittances and unemployment while others report that remittances increase unemployment. This study empirically examines the impact of remittances on unemployment using macroeconomic data for a sample of 18 Latin American and Caribbean countries. Specifically, the study tests whether there is a nonlinear relationship between the variables. Results suggest that when the remittance‐to‐GDP ratio is low, remittances have a positive and significant impact on unemployment. However, as they increase, remittances are negatively associated with unemployment. This suggests the possibility that estimations based on the assumption of a linear relationship between remittances and labor may mask the true relationship between the variables.     

Achieving greater financial independence for Latin America: A proposal

Financial intermediation development in Latin America illustrates the various ways in which the financial system may influence growth, efficiency, and welfare. Though the financial repression of earlier years has begun to be alleviated, much of the resulting growth of finance in Latin America has been concentrated within the countries or between them and the now-developed regions. Intraregional financial flows have been largely overlooked as an avenue for the increase of financial savings and of regional control over the mobilization and allocation of financial resources. This paper proposes the creation of new instruments designed to further the development of financial intermediation on a regional basis. A Latin American Development Bond programme is suggested which would increase the level of voluntary financial savings for regional development purposes and would reduce the present triangulation of credit flows through financial intermediaries outside of Latin America.     

Latin American structuralism: A methodological perspective

Latin American structuralism has played a central role in the debates on economic development theory and policy since the 1950s.The career of Raúl Prebisch has mirrored the trajectory of structuralism and can provide it an historical context. After noting the importance of structuralism, the article isolates its main tenets. It then places Latin American structuralism within the methodological tradition of structuralism which includes writers such as Piaget, Levi-Strauss and Chomsky in other disciplines. Methodological the key to the success of Latin American structuralism is its ability to isolate a deep structure of the international economy and to center its analysis around it. The understanding of the domestic economy and of short-run policy problems is less satisfactory. After a brief eclipse during the late 1970s, Latin American structuralism is currently a vital mode of understanding development problems, in this case through its marriage with a more formal, mathematical approach to knowledge originating in the United States.     

THE CAMPESINOS' PERSPECTIVES IN LATIN AMERICA*

This article deals with the aborted attempts at land reform in Latin America during the 1960's and outlook for 1970–1980. It has long been evident to the sophisticated—and even to less alert—observers of the Latin American panorama that land reforms are both an essential prerequisite for improving the welfare of the hard-pressed campasinos (peasants) and a cornerstone of general economic, political and social progress.     

Does China have an impact on foreign direct investment to Latin America?

We analyze empirically whether the emergence of China as a large recipient of FDI has affected the amount of FDI received by Latin American countries. Allowing for the structural break related to China's WTO accession, we found a significant negative impact of Chinese inward FDI on that of Mexico until 2001 and on that of Colombia after that date. The rest of Latin American countries do not seem to be affected by Chinese inward FDI. For the region as a whole, there is no significant Chinese effect on Latin America’s FDI.     

Marginalization Revisited: Women's Market Work and Pay,and Economic Development

A substantial literature argues that women have been left out of economic development, but evidence from labor force surveys in middle-income developing countries suggests otherwise. Women's participation rates in the market labor force have been increasing, women have shifted into white-collar occupations, and certain previously male-dominated occupations have become female-dominated (clerical work in Asia, for example). Women's relative pay has risen somewhat faster in Asia and Latin America than occurred during industrialization in the United States. Although inequalities remain, there is no evidence that women on average are being marginalized.     

The effects of IMF programs in the Third World: Debate and evidence from Latin America

This article reviews the debate about the effects of IMF-sponsored stabilization programs in the Third World. After examining recent studies by Fund economists, results of a new study on a Latin American country set are presented. In this research, IMF programs are associated with insignificant changes in the current account, significant improvements in the overall balance of payments, increases in inflation, mixed effects on growth, and a strong and consistent pattern of reduction in labor share of income. The latter result is incorporated into a distribution-oriented critique of Fund policy.     

The job crisis in Latin America: A role for multinational corporations in introducing more labour-intensive technologies

Latin America presently faces a critical unemployment problem. A major cause has been an emphasis on ‘maximum-growth’ models and ‘sophisticated’ industrial production techniques rather than on programmes and processes which utilize human resources more fully. A variety of factors-economic, technological, political, and cultural-accounts for the proliferation of these inappropriate technologies, but possibilities exist in most industries to adapt them so as to employ more labour economically. To date, multinational corporations have done little in this field, but Latin American governments can and must prevail upon them to contribute to a resolution of the unemployment problem.     

Exchange Rates and Economic Recovery in the 1930s: An Extension to Asia

Scholars have found a positive relationship between the magnitude of currency depreciation and the extent of recovery from the Great Depression for Europe and Latin America. The relationship between currency depreciation and economic activity during the Great Depression for Asian economies has not yet been explored. This paper examines this topic using data from 13 Asian economies: China, India, Indonesia, Iran, Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand, Turkey, and Vietnam. We find that Asian economies responded in a similar way to currency depreciation during the Great Depression as did European and Latin American countries.     

Patterns of technology imports: interregional comparison

There is not much direct trade between the major Latin American economies (Argentina, Brazil, Mexico) and Eastern Europe. However, these regions are increasingly interacting as borrowers of money and technology from western sources. During the last two decades the Latin Americans have been importing much more western technology—as documented in patent and license data—than Eastern Europe, one reason being that the former gain from large-scale direct investment by western firms, whereas Eastern Europe does not. Eastern Europe outspends Latin America on domestic research and it generates more endogenous technology as well, but this factor does not compensate for its smaller imports of western technology. This is demonstrated by the progressive erosion of Eastern European exports of technologically complex manufactures to the West by the aggressive exporters from the large Latin American and other newly industrializing countries. As recent developments indicate—including the contrasting response by the two regions to the debt crisis—it is likely that the heavier involvement of the Latin Americans in technology imports will continue with obvious implications for the competitiveness of these two regions in the western market for manufactures.     

The age of mass migration in Latin America

The experiences of Latin American countries are not fully incorporated into current debates concerning the age of mass migration, even though 13 million Europeans migrated to the region between 1870 and 1930. This survey draws together different aspects of the Latin America immigration experience. Its main objective is to rethink the role of European migration to the region, addressing several major questions in the economics of migration: whether immigrants were positively selected from their sending countries, how immigrants assimilated into the host economies, the role of immigration policies, and the long‐run effects of immigration. Immigrants came from the economically backward areas of southern and eastern Europe, yet their adjustment to the host labour markets in Latin America seems to have been successful. The possibility of rapid social upgrading made Latin America attractive for European immigrants. Migrants were positively selected from origin according to literacy. The most revealing aspect of new research is showing the positive long‐run effects that European immigrants had in Latin American countries. The political economy of immigration policies deserves new research, particularly for Brazil and Cuba. The case of Argentina shows a more complex scenario than the classic representation of landowners constantly supporting an open‐door policy.     

Public capital formation and labor productivity growth in Mexico

This paper addresses the important question whether public investment spending on economic infrastructure enhances economic growth and labor productivity in Mexico. Following the lead of the endogenous growth literature, it presents a modified production function which explicitly includes the positive or negative externality effects generated by additions to the public capital stock. Using cointegration analysis, the paper proceeds to estimate a dynamic labor productivity function for the 1955–94 period that incorporates the impact of the growth rate in the stocks of both private and public capital (as opposed to the flows) and the economically active population (EAP) (rather than the rate of population growth). The results suggest that (lagged) increases in public investment spending on economic infrastructure—as opposed to overall public investment spending—have a positive and highly significant effect on the rate of labor productivity growth. In addition, the estimates suggest that increases in government consumption expenditures may have a negative effect on the rate of labor productivity growth, thus suggesting that the composition of government spending may also play an important role in determining the rate of labor productivity growth. Finally, the findings call into question the politically expedient policy in many Latin American countries of disproportionately reducing public capital expenditures on economic and social infrastructure to meet targeted reductions in the fiscal deficit as a proportion of GDP.     

Purchasing Power Parity during Currency Crises: A Panel Unit Root Test under Structural Breaks

We investigate the stationarity of real exchange rates using a panel of Asian and South and Latin American countries by applying a new panel unit root test that is robust to structural breaks due to currency crises. It turns out that the long-run PPP relationship is relevant for the Asian countries, which experienced a flexible exchange rate, whereas for the South and Latin American countries, for which the exchange rate has been pegged to the U.S. dollar for a long time, the PPP relationship breaks down. In Asian countries PPP appears to hold before the 1997 crisis, which is not the case for the South and Latin American countries. This suggests that the Asian flu corresponds to a second-generation type of crises, whereas the 1995 Mexican tequila fits the first-generation models better. JEL no. C13, C33, E41     

The delicate balance for jointly pursuing economic growth in Latin America and China

This paper examines the sources of economic growth for a group of Latin American countries in relation to their export performance in China. The analytical framework is based on an extended normalized quadratic profit function. The ensuing econometric results confirm that a favorable export record with China represents a positive source of growth for Latin America. However, it also creates long-run dependability conditions in terms of reduced prices and thinner profits that weaken its growth capacity. Latin American countries must seek product diversification away from their current commodity base and aggressively climb up the value chain to remain competitive worldwide.

Managerial Relevance: identify the sources of economic growth for a group of Latin American countries in relation to their export performance in China; the weakness of this economic growth model; how to seek product diversification away from their current commodity base with emphasis on value chain.     

城镇化中的社会保障制度建设：来自拉美国家的教训

拉美国家在历史上出现过经济高速增长和快速城市化的阶段,但是经济增长并没有解决贫困现象和缩小收入差距,出现了“增长性贫困”现象,而收入悬殊限制了经济的进一步增长。社保制度存在缺陷是导致拉美国家增长性贫困的主要原因之一：社保制度严重滞后于城市化进程,住房和就业困难,非正式就业较为普遍;养老保险计划的覆盖面较低,收入再分配难以进行;养老金管理成本居高不下,导致养老保险扩面难;社会保险与社会救助的比重失调,中产阶级成为社会保障制度的最大受益者;社保和教育机会的缺失,造成代际贫困的恶性循环。拉美国家这些教训为我国社保制度的完善提供了很好的借鉴。     

Rural women and state policy: The Latin American agrarian reform experience

This review of 13 Latin American agrarian reforms shows that most have directly benefited only men. It is argued that this is largely because of the common designation of ‘households’ as the beneficiaries of an agrarian reform and the subsequent incorporation of only male household heads into the new agrarian reform structures. It is shown that a necessary, but not sufficient, condition for rural women to benefit on par with men is that they too be designated as beneficiaries. Women as well as men must be given access to land or the opportunity to participate within the agrarian cooperatives or state farms promoted by an agrarian reform. This comparative analysis of the Latin American agrarian reform demonstrates that this has happened only in countries where the incorporation of rural women to the reform is an explicit objective of state policy.     

ECONOMIC LIBERALIZATION AND CHANGES IN CORPORATE CONTROL IN LATIN AMERICA

This article analyzes ownership restructuring and changes in corporate control in four large Latin American countries—Argentina, Brazil, Chile, and Mexico—during the 1990s. Drawing on original firm‐level data, this is a comparative study aimed at identifying cross‐country differences and regularities. It focuses on transactions associated with privatizations and private mergers and acquisitions (M&As)—their evolution, relative importance, and sectoral incidence—as well as the role played by different types of investors: local, foreign, and joint ventures. A specially built database was used in the analysis, comprising 3,085 private M&As and 329 privatization transactions. Although similar to processes occurring elsewhere, it is argued that ownership restructuring in Latin America was facilitated and fostered by specific changes in policy‐associated institutional framework conditions. That is, the wide‐ranging process of ownership restructuring is strongly associated with economic liberalization, which has become the main feature of Latin American national regimes of incentives and regulation.     

W. Arthur Lewis lecture: Should there be a marshall plan for eastern europe?

The desirability of massive financial aid to support the transition of East European countries to market economies is considered in the light of structural adjustment experience of Latin American countries. It is argued that, politically, an autonomous state is necessary to guide the restructuring. The democratization of Eastern Europe decreases the autonomy of the state. Economically, recent experience in Latin America and Eastern Europe has demonstrated that reforms take place during periods of stringency rather than affluence. It is therefore argued that trade and foreign investment are preferable to generous aid.     

Future sustainable Latin American growth: A need for savings

This article, starting from the Lewis emphasis upon increasing productivity, analyzes the external and internal sources of disequilibrium in Latin America over the last two decades. It indicates the impressive progress, and continuing requirements, that have been made in both dimensions over the last fifteen years. The real requirement for continued growth at high rates, emphasized by Lewis more than 45 years ago, is, however, increased rates of internal saving. Until the Latin American countries are able successfully to increase their domestic savings, hopes for sustained expansion will be continuingly frustrated.     

Cooperation among national drug manufacturers: Asociación Latinoamericana de Industrias Farmacéuticas (ALIFAR)

This article examines the background to the establishment of the Latin American Association of Pharmaceutical Industries (ALIFAR) and describes its activities and achievements. The national firms in Latin America lacked an institutionalized organization to present their collective viewpoints to governments and international organizations when they held important deliberations affecting the development of the pharmaceutical industry. Transnational corporations, on the other hand, were supported very effectively by a global organization. The creation of ALIFAR was, therefore, a logical and a strategical step in the fight for survival of the national firms in Latin America. Since its establishment in November 1980, ALIFAR has shown significant results and encouraging promise, which are described in the article and which may serve as useful guidelines for action in other developing countries.