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31. Do Public Development Banks Hurt Growth? Evidence from Brazil

Author:
Monica de Bolle
Publication Date:
09-2015
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics
Abstract:
Public lending by the Brazilian Development Bank (BNDES) may have done more harm than good in Brazil, adversely affecting real interest rates and productivity growth. Specifically, BNDES's large amounts of subsidized lending are responsible for substantial credit market segmentation, choking off monetary policy transmission. As a result, to maintain price stability the Central Bank of Brazil is forced to raise interest rates more than it might do otherwise in the absence of BNDES lending. Restoring Brazil's capacity to grow in the medium term requires a thorough rethinking of the role of BNDES. In particular, the bank's lending rates should be aligned with market prices, term and risk premia, while taking into account that, with an adequate transparency framework, public development banks can increase private sector participation instead of crowding it out.
Topic:
Development, Economics, International Trade and Finance, and Markets
Political Geography:
Brazil and Latin America

32. China's Evolving Role in Latin America: Can it Be a Win-Win?

Author:
Enrique Dussel Peters
Publication Date:
09-2015
Content Type:
Working Paper
Institution:
Atlantic Council
Abstract:
Weeks before Chinese President Xi Jinping meets with President Barack Obama in Washington, the Atlantic Council's Latin America Center launched a new report that unravels the complexities of the Latin America-China relationship. Titled China's Evolving Role in Latin America: Can it Be a Win-Win?, the report provides five recommendations to help both China and Latin America usher in a mutually beneficial post-commodity-boom relationship. The key to long-term success will be to insure that the relationship promotes—rather than delays—economic growth and social progress in the hemisphere. In the report, renowned Mexico-based China Expert Enrique Dussel Peters, an Atlantic Coucil author and Professor at the Graduate School of Economics at the National Autonomous University of Mexico (UNAM), calls for a ratcheting up of strategic planning and multilateral support so the relation¬ship is a win-win for all parties, including the United States. A deep dive of the state of play is provided for five countries: Argentina, Brazil, Cuba, Mexico, and Venezuela. These countries illustrate the spectrum of ties with China, ranging from those with long and complex historical relation¬ships to those almost entirely structured around recent opportunities for economic cooperation.
Topic:
Diplomacy, Economics, and Bilateral Relations
Political Geography:
China and Latin America

33. Capital Controls and Implications for Surveillance and Coordination: Brazil and Latin America

Author:
Marcio Garcia
Publication Date:
04-2015
Content Type:
Working Paper
Institution:
Centre for International Governance Innovation
Abstract:
From 2009 until 2011, Brazil utilized capital controls to deter real exchange rate appreciation. These measures may have obstructed necessary changes in the fiscal policy stance from occurring. In Chile, which employed capital controls heavily in the 1990s and then decided not to use them again during the commodity super-boom in the 2000s, suggests that an adequate fiscal policy stance provides better results than the use of capital controls. In addition, the recent experiences of Colombia and Peru demonstrate capital controls are not always necessary. This paper makes recommendations for capital control surveillance and coordination, using the Brazilian experience as an example, and draws on experiences in other Latin American countries. When analyzing the implications for surveillance and coordination, international institutions, such as the International Monetary Fund, should take into consideration that, no matter how many caveats are listed before its guidelines, capital controls mainly serve to bypass needed changes in macroeconomic policy, thereby jeopardizing economic performance.
Topic:
Economics, Foreign Exchange, and International Monetary Fund
Political Geography:
Brazil and Latin America

34. Amérique latine - L’année politique 2015

Author:
Maya Collombon, Hélène Combes, Olivier Dabène, Gaspard Estrada, Marie-Laure Geoffray, Ana Carolina González Espinosa, Erica Guevara, Damien Larrouqué, Marilde Loiola de Menezes, Frédéric Louault, Frédéric Massé, Mohcine Mounjid, Eduardo Rios, and Darío Rodriguez
Publication Date:
12-2015
Content Type:
Special Report
Institution:
Centre d'Etudes et de Recherches Internationales
Abstract:
Amérique latine - L’Année politique is a publication by CERI-Sciences Po’s Political Observatory of Latin America and the Caribbean (OPALC). The study extends the work presented on the Observatory’s website (www.sciencespo.fr/opalc) by offering tools for understanding a continent that is in the grip of deep transformations.
Topic:
Political Violence, Economics, Regional Cooperation, Bilateral Relations, Sociology, and Elections
Political Geography:
Brazil, Argentina, Colombia, Cuba, Arab Countries, Latin America, Nicaragua, Caribbean, Venezuela, Mexico, and United States of America

35. L’insécurité énergétique en Amérique du Sud : développement des réseaux et intégration sectorielle entre le Pérou et le Chili (Energy Insecurity in South America : Network Development and Sectoral Integration in Chile and Peru)

Author:
Alvaro Artigas
Publication Date:
10-2015
Content Type:
Special Report
Institution:
Centre d'Etudes et de Recherches Internationales
Abstract:
The South American continent has experienced a robust economic growth presently overshadowed by an uneven energy integration that fails to meet both an ever-growing industrial and metropolitan demand. Several integration mechanisms co-exist, but a poor integration layout threatens the energy security of the region and individual countries. Several factors contribute to this. Firstly, the very template of regional integration has failed to deliver a valid set of supranational coordination mechanisms aimed at coordinating and sorting out disputes among individual countries. Secondly, national States tie security to self-sufficiency in the face of mutual distrust, thus rendering potential advantages of market and networks integration a less desirable choice. The example of Chile and Peru integration drive reveals many of these dynamics while showing at the same time the windfalls of a transversal sectoral coordination over diplomatic exchange by individual states. What is the potential for an alternative template where the State will play a less intrusive role while consigning territorial disagreements backstage?
Topic:
Economics, International Trade and Finance, Political Economy, Natural Resources, and Regional Integration
Political Geography:
South America, Latin America, Chile, and Peru

36. Scarcity without Leviathan: The Violent Effects of Cocaine Supply Shortages in the Mexican Drug War

Author:
Juan Camilo Castillo, Daniel Mejia, and Pascual Restrepo
Publication Date:
02-2014
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Using the case of the cocaine trade in Mexico as a relevant and salient example, this paper shows that scarcity leads to violence in markets without third party enforcement. We construct a model in which supply shortages increase total revenue when demand is inelastic. If property rights over revenues are not well defined because of the lack of reliable third party enforcement, the incentives to prey on others and avoid predation by exercising violence increase with scarcity, thus increasing violence. We test our model and the proposed channel using data for the cocaine trade in Mexico. We found that exogenous supply shocks originated in changes in the amount of cocaine seized in Colombia (Mexico's main cocaine supplier) create scarcity and increase drug-related violence in Mexico.
Topic:
Crime, Economics, War on Drugs, Narcotics Trafficking, and Law Enforcement
Political Geography:
Colombia, Latin America, and Mexico

37. From Maize to Haze: Agricultural Shocks and the Growth of the Mexican Drug Sector

Author:
Oeindrila Dube, Omar Garcia-Ponce, and Kevin Thom
Publication Date:
02-2014
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
We examine how commodity price shocks experienced by rural producers affect the drug trade in Mexico. Our analysis exploits exogenous movements in the Mexican maize price stemming from weather conditions in U.S. maize-growing regions, as well as export flows of other major maize producers. Using data on over 2,200 municipios spanning 1990-2010, we show that lower prices differentially increased the cultivation of both marijuana and opium poppies in municipios more climatically suited to growing maize. This increase was accompanied by differentially lower rural wages, suggesting that households planted more drug crops in response to the decreased income generating potential of maize farming.
Topic:
Agriculture, Economics, Poverty, War on Drugs, and Narcotics Trafficking
Political Geography:
Latin America and Mexico

38. Beyond Equal Rights

Author:
Michelle Bachelet
Publication Date:
03-2014
Content Type:
Journal Article
Journal:
Americas Quarterly
Institution:
Council of the Americas
Abstract:
Women's political and economic participation strengthens democracy, equality and the economy. And while women's empowerment and full participation in society are important goals in themselves, they are also vital for reducing poverty, achieving universal education, improving maternal and child health, and fulfilling other development goals. Increasing the presence of women in politics not only responds to their rights as citizens; it enriches political discourse, decision-making and inclusiveness, and improves social conditions through the passage of equitable laws and policies.
Topic:
Economics and Politics
Political Geography:
Latin America

39. Latin America's tourism boom — Evangelicalism in Brazil.

Author:
Olivia Ruggles-Brise
Publication Date:
03-2014
Content Type:
Journal Article
Journal:
Americas Quarterly
Institution:
Council of the Americas
Abstract:
Latin America's travel and tourism industry took a hit during the 2008–2009 recession. International arrivals slowed and tourists had less money to spend. But over the longer term, tourism has been a success story—and forecasts suggest continued growth. That should surprise no one. Latin America's sheer diversity in scenic beauty, cuisine and cultures has combined with an increasingly sophisticated domestic industry to cater to every kind of traveler. Since 2006, tourism's direct contribution to GDP in Latin America has grown by 7 percent in real terms—more than double the world average—to reach an estimated $134 billion in 2011. This figure, which is projected to rise to $224 billion in 2022, includes revenue generated by tourism-oriented services such as hotels and airlines, as well as restaurant and leisure industries that cater to tourists. Forecasts for this year suggest tourism's direct contributions will grow by 6.5 percent, behind only Northeast and South Asia (6.7 percent).
Topic:
Economics
Political Geography:
United States, Brazil, and Latin America

40. Not Poor, But Not Middle Class Yet

Author:
Luis Felipe Lopez-Calva
Publication Date:
03-2014
Content Type:
Journal Article
Journal:
Americas Quarterly
Institution:
Council of the Americas
Abstract:
During the first decade of the twenty-first century, Latin America's increasing prosperity and social progress have led analysts to conclude that historic change is taking place. Indeed, poverty in Latin America fell from 41.4 percent in 2000 to 28 percent in 2010, even at a time of global distress1—a result, in part, of both sustained economic growth and reductions in inequality. As a result, the focus in policy circles has switched to the role an emerging middle class can play in the region, both as an engine of growth and as the foundation for social cohesion and better governance. The key to understanding this shift is accurately defining the middle class in economic terms.
Topic:
Economics and Governance
Political Geography:
Latin America