Suchergebnisse

This paper takes stock of Chile's defined contribution pension system and assesses reform options aimed at increasing replacement rates. An international comparison shows that, despite being quite influential when established, it is now delivering low replacement rates relative to OECD peers, as its parameters did not adapt over time to changing demographics, declining global returns, higher-than-expected informality in the labor market, and, more recently, to legislation allowing for pension savings withdrawals to counter the effects from the COVID-19 pandemic. We find that a reform that raises contribution rates and the retirement age would significantly improve replacement rates and lower fiscal costs associated with the system, especially if accompanied by complementary policies to boost workers' contribution density.

JEL Classification Codes: D14; H30; H55

Traditional measures of trade diversification only take into account contemporaneous export baskets. These measures fail to capture a country's ability to respond to shocks by allocating factors of production into activities for which it has already paid the fixed costs associated with exporting. This paper corrects for the shortcoming of traditional measures of diversification by introducing a novel measure of trade diversification—latent diversification—and proposes a proxy to measure latent diversification, which is calculated by taking into account the entire history of a country's exports. The paper shows that the observed gaps between traditional measures of diversification and the proposed proxy of latent diversification are sizeable; countries hold latent export baskets that are, on average, three times as large as their average contemporaneous export basket, and these gaps are largest for poor and small countries. Moreover, latent diversification is an important determinant of volatility—more diversified latent export baskets are associated with lower terms of trade volatility and, subsequently, lower GDP per capita volatility, even after controlling for the degree of contemporaneous export diversification and other trade and country characteristics. The latter result, together with the disproportionately large latent baskets relative to contemporaneous baskets observed in poor and small countries, suggests that latent diversification is an important vehicle toward stability in countries that face barriers in building diversified contemporaneous export baskets.

This paper estimates the macroeconomic effects of market-oriented reforms in Latin
America and the Caribbean using the IMF Structural Reform database. We find that large
changes in the reform index have positive effects on GDP that exceed 2 percent after
five years. Furthermore, reforms boost employment, investment, exports, and imports and
reduce export concentration, in addition to favoring tradable sectors. The evidence on
the effects of reforms on business confidence is mixed, and the effects on total factor
productivity are positive, but less precisely estimated. Nonetheless, our results also
indicate that the effects of reforms have not been uniform across different segments of
the population. Our results are robust to the use of an instrumental variables approach
that exploits regional waves of reform to deal with endogeneity concerns. These findings
bring to the forefront the need to consider accompanying policies to ensure that reforms
promote inclusive growth.