Statistical Bulletin: International Trade in Goods in Latin America and the Caribbean - first quarter 2020 - 39

A Blue Path for the Caribbean: Ocean Sustainability for Prosperity and Resilience

The Hummingbird Vol. 7 No. 9

CEPAL Review no. 131

International financial cooperation to address the Latin American economic crisis / José Antonio Ocampo .-- Mapping social conflicts in natural resources: a text mining study of extractive activities / Ramiro Albrieu and Gabriel Palazzo .-- The ECLA technique of programming and economists in Argentina in the mid-twentieth century / Mariano Arana .-- Indicator of the efficiency of value added tax and income tax collection in Ecuador / José Ramírez-Álvarez and Paul Carrillo-Maldonado .-- Growth and heterogeneity of human capital: effects of the expansion of higher education on the income increas…

Macroeconomic stability and economic growth: myths and realities

In this paper, we explore empirical relationships between sustained GDP growth and macroeconomic volatility, using World Economic Outlook data for the period 1980–2015, both in descriptive statistics and in fixed-effect panel regressions (IMF, 2016). The results debunk certain myths, such as those that maintain that more inflation generates more growth, that stabilization carries real costs, or that large inflows of foreign capital stimulate growth. We show that inflation has a tangible negative impact on growth and that there are “inflation thresholds”, beyond which that impact increases. Hig…

Brazilian industry and knowledge absorption: internal and external company determinants

Technological composition and productive diversification are distinguishing features of countries’ long-term growth trajectories. Investing in research and development (R&D), infrastructure and technology is a possible alternative for developing countries looking to accelerate their growth trajectory. In the case of Brazil, the production structure must be modified and productivity increased, by endogenizing technological advances, in order to narrow the technology gap. The factors that determine investment in absorption of external knowledge must be defined. To this end, a multilevel anal…

Impact of COVID-19 on the United States economy and the policy response

The outbreak of the coronavirus disease (COVID-19) pandemic has upended the global and United States economies, exacting a large human toll and shutting down major economic sectors. While there is significant uncertainty about United States economic growth prospects, the impact of the pandemic is severe. The record-long United States economic expansion came to an end as a result of the COVID-19 pandemic, with forecasts of a deep recession in 2020. The outlook remains highly uncertain, as it is difficult to gauge the social and economic impact of the pandemic, which will depend on the success o…

Fostering investment of the family remittances in value chains : Case studies in the Dominican Republic, El Salvador and Guatemala

Family remittances represent an important source of resources and external financing for many Latin American and Caribbean countries, helping greatly to reduce poverty, increase private consumption, and boost national economic growth, among other things. Although a large share of remittances are intended to cover basic needs, such as food, health care and housing, some of them could be used to finance income-generating activities. This document summarizes the main findings of the technical collaboration project carried out by the Economic Commission for Latin America and the Caribbean (ECLAC)…

Indicator of the efficiency of value added tax and income tax collection in Ecuador

This paper outlines a methodology to measure the efficiency of revenue collection by tax administrations. The proposed methodology is aimed in particular at developing countries that do not have enough disaggregated information to measure tax gaps (registration, filing, veracity and payment) using traditional methods. The proposed indices are based on estimations of the structural balances of public finances, and rises in the indices can be interpreted as a comprehensive narrowing of tax gaps. The methodology is applied to Ecuador’s value added tax (VAT) and income tax, producing results that …

Constant real expenditure policy: the macroeconomic impacts of budget composition and a primary surplus

This paper analyses the fiscal policy of constant real expenditure recently adopted by Brazil’s fiscal authorities. It also compares the policy of maintaining a primary surplus as a proportion of gross domestic product with that of changing the composition of spending in favour of investment in order to identify which of the two policies is more efficient in promoting economic growth. We investigate the effects of these policies on long- and short-term consumption, investment, labour supply and output and the reaction of the term structure of interest rates. We also analyse the relationship be…

Assessment of the effects and impacts caused by Hurricane Irma: the Bahamas 2017

Hurricane Irma was the ninth named hurricane of the 2017 Atlantic Hurricane Season. Being an Archipelago in the Caribbean, a great portion of The Bahamas infrastructure is in proximity to the coast, making it particularly vulnerable to tropical storms. Irma directly and primarily affected the southern islands of Inagua, Acklins, Ragged Island and Southern Andros, and affected Bimini and Grand Bahama to the north, while it also caused moderate effects across the country. The effects of hurricane Irma on the population of The Bahamas were moderate. According to the reports prepared by the govern…

Mapping social conflicts in natural resources: a text mining study of extractive activities

Applying text mining techniques, a methodology was developed to measure the number of social conflicts related to the exploitation of non-renewable natural resources. The study focuses on conflicts in four mining countries (Australia, Canada, Chile and Peru) between 2003 and 2016, based on more than 20,000 articles from the leading newspapers of each country. A statically significant correlation was found between the main index and mineral rents as a percentage of gross domestic product (GDP). However, the results should be interpreted with caution since endogeneity issues have not been addres…

The manufacturing industry in Mexico: a history of production without distribution

This paper analyses the historical performance of the Mexican manufacturing industry based on the strategies that began to be adopted in the 1960s. It examines in particular the relationship between the productive increases driven by the opening of the market and the levels of economic well-being observed among people involved in this sector. The results of a sequential analysis of historical trends and estimates of production functions and distribution mechanisms suggest that the productive success of the manufacturing industry has only served to boost the economic well-being of companies and…

International financial cooperation to address the Latin American economic crisis

The current economic crisis will be remembered, not only as the worst since the Great Depression, but also for the limited multilateral financial cooperation agreed, particularly for middle-income economies. Several Latin American countries have benefited from flexible and emergency credit lines from the International Monetary Fund (IMF), in addition to other IMF instruments. Members of the Latin American Reserve Fund (known by its Spanish acronym, FLAR) can access its resources. Multilateral development banks have taken steps to support Latin American countries, but resources are limited. The…

Growth and heterogeneity of human capital: effects of the expansion of higher education on the income increase in Brazilian municipalities

This study analyses the effects of the expansion of the highly skilled labour force (higher education) on the per capita income increase in Brazilian municipalities. The results show that a larger highly educated labour force translates into stronger growth in the most developed municipalities with fewer opportunity costs, measured by wage differences. The reduction of regional inequalities fostered by the expansion of higher education over the past 15 years will become sustainable if the increase in the skill supply is accompanied by a rise in demand, so the opportunity costs between factors …

Nationalism and development: an alternative for Mexico

The most developed countries have generally had an active State, a driving, regulatory and protectionist State, among other roles, although the most consolidated concept seems to be that of a developmental State. In this paper, a social accounting matrix of Mexico is constructed in order to design a dynamic-recursive applied general equilibrium model to analyse and quantify the impact of policies that were promoted by the State; in particular, policies aimed at increasing private savings and subsidies for the consumption of domestic inputs. The implementation of these simple policies was found…

Assessment of the effects and impacts of Hurricane Dorian in the Bahamas

In September 2019 , the world watched as the category 5 Hurricane Dorian rained havoc down on The Bahamas islands of Grand Bahama and Abaco and their communities, erasing any evidence of life in some neighborhoods and leaving behind a trail of heartbreak, sorrow and death. The catastrophic damage to livelihoods and billions of dollars of infrastructure on this archipelago present significant challenges to the preparedness of its tourism -dependent economy and its rescue and recovery capacity. The Interamerican Development Bank (IDB) committed itself to a restoration effort that would be far -r…

The ECLA technique of programming and economists in Argentina in the mid-twentieth century

This article analyses the origin and development of the technique of programming of Jorge Ahumada, of the Economic Commission for Latin America (ECLA),2 and its importance for economists and economic development planning institutions. To that end, it examines the circulation of the technique in various organizations in Argentina and shows how planning gained legitimacy alongside the main economic policy debates of the mid-twentieth century, while describing the institutional circulation of experts and their texts in the country. The ECLA contribution was found to have a direct impact on local …

The determinants of life satisfaction among Chilean workers

This article puts forward evidence to identify the different domains that contribute to life satisfaction among a sample of Chilean workers, using the two-layer model developed by van Praag, Frijters and Ferrer-i-Carbonell (2003). The results show that satisfaction in the domains of money, privacy, leisure, family life, health and work have a positive (and statistically significant) effect on life satisfaction, when controlling for a variable that attempts to measure workers’ personality traits. The evidence reveals that the effects of family life, leisure, health and work outweigh those of mo…

Assessment of the effects and impacts of the Hurricane Matthew: the Bahamas

The passage of Hurricane Matthew through The Bahamas in October 2016 marks the second time in just over a year that the country was affected by a Category 4 hurricane. However, unlike 2015’s Hurricane Joaquin, which affected islands having a relatively low population, Hurricane Matthew’s greatest impact was felt on the country’s population centres of New Providence and Grand Bahama, as well as in the district of North Andros. Damage in these areas was caused by high winds and storm surge associated with the hurricane, and was exacerbated by construction practices and the siting of communities …