Suchergebnisse

The last 20 years were a period of major political, economic, social, and institutional reform in Brazil. In the first half of the 1990s, reformers opened the economy to foreign trade and both direct and portfolio investment, sold off a number of large and traditional state-owned enterprises, discontinued myriad price and output regulations, and gradually erected a new regulatory framework. Except for trade liberalization, which was largely completed by the mid-1990s, reforms accelerated after the Real Plan. The consolidation of price stability and market-oriented reforms, in turn, required a number of institutional changes including the strengthening and/or creation of competition and regulatory agencies, and the enactment of new legislation to promote fiscal discipline, improve regulation of financial markets, and protect consumers. This paper focuses on this gradual, piecemeal, loosely coordinated process of partial state retrenchment. The analysis focuses especially on the relative roles of ideology, policy packaging, and pragmatism in advancing reforms; how well reform implementation went; to what extent their results were as expected; and whether state retrenchment is here to stay. We argue that pragmatism - understood as a conduct that emphasizes practicality and stresses practical consequences as constituting the essential criterion in determining action - has been the main driving force behind reforms. In contrast to other Latin American countries, ideology and politics have played a lesser role in fostering market reforms in Brazil. In particular, although reforms were often bundled together with other urgent or popular policies, to facilitate their approval, they were not enacted as a coherent, overall change in development strategy, and more as a piecemeal, flexible, mostly disconnected reform process. Pragmatism led to market reforms that, as a rule, were gradual, usually incomplete and only loosely coordinated with one another. Although these characteristics sometimes facilitated reform politics - opening windows of opportunity and reducing political opposition - they also reduced the efficacy of reforms. In particular, pragmatism was insufficient to generate complementary, second-generation reforms. The overall impact of reforms has not been significant in Brazil, with only a marginal acceleration in GDP growth, due entirely to higher productivity growth. To the extent that pragmatism reflects an approach in which the end results are the main justification for reform, the failure to spur growth after over a decade of reforms puts their sustainability at risk.

Like several other countries in Latin America, after 2003 Argentina took considerable steps to distance itself from the neoliberal policies it had followed for almost 30 years. Yet there have also been critical continuities from the neoliberal era. Our argument is that these continuities manifest themselves most clearly in the nature of economic growth and in the endurance of some of the most troubling trends in labor markets over the last 30 years. JEL classification: J21, J83, O54

Lateinamerikas Wirtschaft stagniert. Die politische Unsicherheit in den wichtigsten Ökonomien, der schwächere Welthandel und die Handelsstreitigkeiten drücken die Wachstumsprognosen. Die Länder verlieren weiter den Anschluss im weltweiten Vergleich. Entwickelt sich Südamerika vom Hoffnungsträger zum Risikofaktor für die Weltwirtschaft? Carsten Hefeker, Universität Siegen, sieht Südamerika in einer tiefen demokratischen und wirtschaftlichen Krise. Die Ursachen seien in jedem Land etwas anders gelagert, aber es zeigten sich auch Gemeinsamkeiten. Neben dem massiven Verfall der Rohstoff- und Agrarproduktpreise seien die Gründe in vielen Ländern in einem Hang zu populistischer Wirtschaftspolitik einerseits und unterlassenen Reformen andererseits zu sehen, die die Stabilität untergraben und zu politischen und ökonomischen Krisen führen. Nach Ansicht von Tobias Boos und Ulrich Brand, Universität Wien, verliert Lateinamerika erneut den Anschluss. In der ersten Dekade der 2000er Jahre hatte es danach ausgesehen, als habe die Region einen dauerhaften Wachstumspfad eingeschlagen. Aber die Regierungen konnten sich nicht aus dem Teufelskreis der Ressourcenabhängigkeit befreien. Und nach dem Ende des Ressourcenbooms wurde ein neuer Zyklus der Auslandsverschuldung in Gang gesetzt. Martin T. Braml, ifo Institut, zeigt auf, dass gerade die großen lateinamerikanischen Länder Argentinien, Bra­silien und Mexiko in den vergangenen drei Dekaden nicht im relativen Entwicklungsstand aufholen konnten. Hingegen sei ein wirtschaftlicher Konvergenzprozess für Chile und Uruguay, die eine starke Integration im Welthandel suchten, zu erkennen. Dies scheine Argentinien und Brasilien, den tonangebenden Staaten innerhalb des MERCOSUR, nur langsam zu gelingen. Auch deshalb biete der Abschluss des EU-MERCOSUR-Freihandelsabkommens eine einmalige Chance für die lateinamerikanischen Länder. Barbara Fritz, FU Berlin, stellt fest, dass bis vor einigen Jahren Südamerika die einzige Region war, der es gelang, Wachstum mit Umverteilung zu verbinden. Davon sei heute wenig übriggeblieben. Seit Jahren stagniere das Wachstum, die Verteilung habe sich in Ländern wie Brasilien sogar wieder verschlechtert. Mit ein Grund für diese Entwicklung sei die Verschlechterung der globalen Rahmenbedingungen seit dem Ende des »sogenannten Superbooms der Rohstoffpreise«. Zudem sei die Region massiv von den großen Handelskonflikten betroffen. Die globale Staatengemeinschaft, ebenso wie die EU, sollten hier unterstützen. Nach Ansicht von Ingrid Wehr, Heinrich-Böll-Stiftung, Santiago de Chile, sind die hohe Abhängigkeit lateinamerikanischer Volkswirtschaften von Rohstoffexporten und die wachsende Reprimarisierung des Exports ein massives Problem der Länder, die somit eher Rentenökonomien als Marktwirtschaften seien. Angelica Dominguez-Cardoza und Christoph Trebesch, Institut für Weltwirtschaft, Kiel, sehen Argentinien erneut vor einem hohen Schuldenschnitt stehen. Dieser sei nur eine Frage der Zeit. Übermäßige Staatsausgaben und eine exzessive Verschuldung in Fremdwährungen hätten die Krise herbeigeführt, gekoppelt mit hoher Inflation und einer schwachen Währung.

Abstract

Abstract
This paper analyzes the self-selection patterns among Mexican return migrants during the period 1990–2010. To calculate the selection patterns, we nonparametrically estimate the counterfactual wages that the return migrants would have experienced had they never migrated by using the wage structure of stayers. We find evidence that the selection patterns in observable skills change over time from positive selection in 1990 toward negative selection in 2010. Additionally, we observe that the wages of return migrants are larger than those that the migrants would have obtained had they not migrated.


JEL Codes
F22, J01, J61, O54

Abstract.  Recent empirical evidence documents the superior characteristics of exporters relative to non‐exporters. Three explanations for this phenomenon have been proposed: self‐selection; learning‐by‐exporting; and conscious self‐selection. We test these three hypotheses using plant‐level data from Chile. We find that plants that enter international markets show superior initial performance compared with non‐exporters, consistent with self‐selection; we observe increases in productivity after plants begin to export, which is consistent with learning‐by‐exporting. We also find strong evidence supporting the idea that self‐selection is a conscious process by which plants increase productivity with the purpose of becoming exporters. JEL classification: F14; O54; D21

I study the causal effect of the foreign aid for development assistance ¿implemented by the U.S. Agency for International Development (USAID)¿ on the intensity of municipality-level armed conflict in Colombia, for the period 2009-2013. To address potential endogeneity biases, I use a Bartik-like instrument which exploits the spatial persistence of aid from USAID in Colombia. Specifically, I instrument foreign aid with the interaction between the United States GDP and municipality-level intent-to-treat indicators for the Malaria Eradication Campaigns (circa 1957). The results point out that foreign aid reduces the insurgency associated with left-wing guerrillas, especially FARC. However, foreign aid does not affect the violence associated with criminal gangs from right-wing paramilitary origins (BACRIM). I provide both quantitative and anecdotic evidence on two potential mechanisms behind my results: (i) Development programs raise the opportunity cost of fighting and; (ii) foreign aid improves the trust, and the information flows between civilians and the government. Finally, I provide empirical evidence that casts doubt on two alternative channels whose predictions cannot be reconciled with the results: (i) that foreign aid increases the potentially- looted rents by the insurgents and; (ii) that development programs rise targeted assassinations committed by insurgents to sabotage and reestablish bargaining power.

In the last three decades, the supply of housing in Argentina has not kept pace with demand. This study analyzes the main drivers of Argentina's housing market and relates them to the macroeconomic environment in order to advance a policy agenda for housing policy reform. The demand for housing was calculated and tenure choice was analyzed. Structural characteristics affecting Argentina's housing market include the high concentration of the urban population in a few large metropolitan areas, the association of urban poverty with the housing deficit, and overcrowding. The mortgage market lost its appeal following the 2001-02 crisis due to widespread breaches of contract legitimized through protective legislation (still in place), insufficient long-term financing, and high inflation. The housing deficit could be eliminated in five to eight years if well-coordinated policy initiatives to develop the mortgage market and provide low-income housing were adopted under a decentralized, demand-driven, subsidized program.

On a global level, the EU emerges as the most important foreign direct investor, also if considering extra-EU investments only. This reflects the capability and propensity of EU firms to internationalize their business activities. A joint analysis of two methodologically very distinct databases - Eurostat FDI data for FDI flows and stocks, and the FDI Intelligence from Financial Times Ltd. for the number of investment projects - made it possible, for the period 2001-2007 and 2003-2008 respectively, to reveal several facts and trends concerning the competitive position of EU firms in the BRICs and vice versa. The EU is among the main investors in each of the BRICs and the dominant investor in Brazil and Russia. In China and India, the EU has less weight. But after correcting for particularities in FDI data, such as the prominent role of Hong Kong and off-shore centres in Chinese FDI and of Mauritius in Indian FDI, the EU ranks higher also in these countries. In a direct comparison with the US and Japan, the EU emerges as the leading investor among the Triad countries in each of the BRICs. This suggests that EU firms are well positioned to compete with other multinational corporations in the BRICs. The analysis of the number of projects confirms this finding, the role of the EU in China is much greater than suggested by FDI data. China emerges as the main BRICs target for EU projects, but in terms of FDI inflows China occupies rank three after Russia and Brazil. The divergent results can be explained by the small number of very large projects in the natural resource sector of Russia and the great number of finance- and trade-related small investments in China. In some cases, FDI has become the major entry strategy of EU firms into the BRICs markets. Global and EU-15 investments in the BRICs, as measured by the number of investment projects, were resilient to the global crisis until 2008. With regards to the current economic downturn and the expected drop in global FDI, the BRICs may find themselves in a privileged position in several respects. First of all they are large economies where FDI is mainly attracted by the local markets with growth expectations above world average, although not in Russia. Local economic growth especially in China and India will allow for FDI to grow if companies from crisis-hit countries are in the position to invest. Larger multinationals may increasingly concentrate on the very few countries in the world where they can expand sales, such as China, India and Brazil, and shift investments there. Also for European companies the expansion to the BRICs remains a major attraction. Due to the size of the BRICs and their distance to Europe, only larger or more specialized investors may benefit from this opportunity. The main conclusion based on the statistical analysis is that the EU is well positioned as a direct investor both on the global level and in the BRICs. In the fast growing markets of China and India, however, the share of EU firms in total FDI is rather low and not particularly dynamic. As investments in such geographically more distant places are mainly realized by large corporations while SMEs typically limit their foreign operations to nearby countries, policy levers may be necessary to expand EU presence there. This is all the more desirable as China and India have a high market potential and EU firms can expect high returns on FDI.

There is widespread discussion both within and outside Cuba concerning what direction the Cuban economy will go under its new interim president Raúl Castro. This short paper is intended to contribute two pieces of information that are needed to intelligently discuss that issue- where Cuba's economy stands today, and what type of reforms Cuba's political and economic leadership say they intend to implement. Its goal is to compactly present current information on some of the key economic issues Cuba faces in regards to both the present and the near future, and thereby give a solidly information-based picture of Cuba's current economic reality. It presents two central conclusions. First, that the evidence supports that there indeed has been real and meaningful accelerated improvement in the Cuban economy in recent years, and at the same time Cuba remains far from being able to meet many of its citizens' economic needs in accord with its own principals of human development. Second, that Cuba intends to continue the process of economic reform that it has been engaged in since at least the early 1990s. This will involve significant restructuring of aspects of how the economy functions, with a central concern with improved efficiency. Cuba intends to introduce some (further) market-mechanisms and in certain areas even markets. But the whole reform process will be conducted in a frame that intends to keep both efficiency considerations and market instruments subordinated to their central goal of building socialism. Two aspects are particularly important in assuring that capitalism-like instruments remain subordinate. The first is an expanded role of the entire population in determining both what is most socially desired, and in presenting ideas on how to improve the economy. The second is the continued use of central planning even as they shift many appropriate decisions in their planning and management process out from the central ministries to the regions and especially to the enterprises.

This paper discusses the experience with opening up to the global economy of two small Central American countries, Honduras and Nicaragua. They have both strengthened democratic processes and reduced defence expenditure dramatically. Both have liberalized their trade régimes in the context of regional integration within Central America and have encouraged foreign direct investment and investment in export processing zones. Nicaragua has made considerable progress toward macroeconomic stability. Honduras, on the other hand, has taken significant strides toward changing its pattern of exports toward more sophisticated primary-product based goods and simple manufactures. In addition, Honduras has emerged as a major assembler of clothing for the United States market. However, neither country has yet succeeded in launching rapid, export-oriented growth. Some of the reasons are weak linkages between the export sector and the rest of the economy, ambiguous signals to private sector producers emanating from economic policy, and low levels of labour productivity. Improving the latter will require major investments in human resources, mainly in education and health. – globalization ; Latin America and the Caribbean ; sustainable growth

In recent decades, there has been a growing literature dealing with the empirical estimation of the rate of profit and other Marxian variables in several countries. Nonetheless, there has been a paucity of econometric research about the impact of those Marxian variables on the growth rate in developing countries. This article seeks to evaluate the rate of profit and the rate of accumulation as determinants of the growth rate in Colombia during 1967–2019, using a generalized vector autoregressive model. We find that both variables are statistically significant and, in concordance with Marxian theory predictions, affect positively the growth rate. We also identify direct impacts of the growth rate over the profit rate and the accumulation rate as well as an economic relevant relationship between these latter variables.JEL Classification: B51, C22, O54

Abstract In the early 1990's, the Argentine government promoted a framework for productivity-based negotiations between firms and unions at low levels of organization. The policy weakened the industry-wide collective bargaining system, which sets working conditions for all firms in an industry. This paper employs newly developed quantile regression approaches to investigate the effect of union practices on productivity within the context of the reform. The findings show that (i) industry-wide practices on displacement of workers and training have a negative impact on productivity; (ii) work practices do not appear to restrict economic efficiency in the post-reform period; (iii) union practices on technology acquisition have an adverse effect on high-productivity growth industries. Productivity seems to improve in an economy promoting policies to weaken industry-wide collective bargaining. JEL codes J52; O14; O43; O54

COVID-19 is likely to have a large impact on the welfare of Tunisian households. First, some individuals might be more vulnerable to contracting the disease because their living conditions or jobs make them more susceptible to meeting others or practicing social distancing. Lack of adequate access to health insurance, overcrowded living conditions, and low access to water at home are reasons that make the Tunisian poor more susceptible to getting infected or not being able to seek health care in the event that they contract COVID-19. In addition, the elderly in the poorest households could be more susceptible to COVID-19 due to higher prevalence of intergenerational households among the poor. Second, many sectors of the labor market have experienced an economic slowdown, and those employed in these sectors are likely to experience disproportionate effects. Combining the labor shock and price shock simultaneously, the simulations in this paper show an increase in poverty of 7.3 percentage points under a more optimistic scenario and 11.9 percentage points under the pessimistic scenario, and individuals in sectors such as tourism and construction are expected to fall into poverty due to COVID-19. The paper estimates that the government's compensatory measures targeted toward the hardest hit are expected to mitigate the increase in poverty. Specifically, the increase in poverty will be 6.5 percentage points under the optimistic scenario if mitigation measures are in place vis-à-vis in their absence, when the increase in poverty is 7.3 percentage points.

For over a century, legal scholars have debated the question of what to do about the debts incurred by despotic governments; asking whether successor non-despotic governments should have to pay them. That debate has gone nowhere. This paper examines whether an Op Ed written by Harvard economist, Ricardo Hausmann, in May 2017, may have shown an alternative path to the goal of increasing the cost of borrowing for despotic governments. Hausmann, in his Op Ed, had sought to produce a pricing penalty on the entire Venezuelan debt stock by trying to shame JPMorgan into removing Venezuelan bonds from its emerging market index. JPMorgan did not comply, but there was a pricing penalty. Intriguingly, the penalty hit only one bond; an issue by Venezuela's state-owned oil company that went on the market two days prior to the Hausmann's piece. That bond then began to carry the name in the market of "Hunger Bond." Using quantitative data and interviews with investors, we try to understand the causes of the Hunger Bond penalty and ask whether there are lessons for policy makers.

For multiple decades, activists have sought to institute an international legal regime that limits the ability of despotic governments to borrow money and then shift those obligations onto more democratic successor governments. Our goal in this article is to raise the possibility of an alternate legal path to raising the costs of borrowing for despotic regimes. All countries have systems of domestic laws that regulate agency relationships and try to deter corruption; otherwise the domestic economy would not function. Despotic governments, we conjecture, are especially likely to engage in transactions that are legally problematic. The reason being that despotic governments, by definition, lack the support of the populace; meaning that there is a high likelihood that actions that they take on behalf of the populace can be challenged as unrepresentative and contrary to the interests of the true principals. The foregoing conditions, if one translates them into the context of an ordinary principal-agent relationship, would constitute a voidable transaction in most modern legal systems. That means that if opposition parties in countries with despotic governments today were to monitor and make public the potential problems with debt issuances by their despotic rulers under their own local laws, it would raise the cost of capital for those despots. To support our argument, we use both the concrete example of the debt issuance shenanigans of the Maduro government in Venezuela and a more general analysis of the relationship between corruption, democracy and a nation's borrowing costs.