New Economics Papers
on Central and South America
Issue of 2012‒04‒10
nine papers chosen by

  1. Changes in Labour Market Conditions and Policies: Their Impact on Wage Inequality during the Last Decade By Keifman, Saul N.; Maurizio, Roxana
  2. Macroeconomic Policies, Growth, Employment, and Inequality in Latin America By Damill, Mario; Frenkel, Roberto
  3. Redistribution without Structural Change in Ecuador: Rising and Falling Income Inequality in the 1990s and 2000s By Ponce, Juan; Vos, Rob
  4. Productivity, Structural Change, and Latin American Development By Carlos Gustavo Machicado; Felix Rioja; Antonio Saravia
  5. Goals Met or Just Empty Promises? First Version of the Democratic Security Policy in Colombia By Gerson Javier Pérez V.
  6. The Japan-Peru FTA : antecedents, significance and main features By González Vigil, Fernando; Shimizu, Tatsuya
  7. Social Policies or Private Solidarity?: The Equalizing Role of Migration and Remittances in El Salvador By Acevedo, Carlos; Cabrera, Maynor
  8. Análisis económico sobre el tamaño óptimo del mercado y ubicación de estaciones de transferencia para el manejo de residuos sólidos en Colombia By Perdomo Calvo, Jorge Andrés; Ramirez Orozco, Juan Andrés
  9. Capital Requirements under Basel III in Andean Countries: The Cases of Bolivia, Colombia, Ecuador and Peru By Arturo Galindo; Liliana Rojas-Suárez; Marielle del Valle

  1. By: Keifman, Saul N.; Maurizio, Roxana
    Abstract: Labour market incomes have been a major contributor to the important fall in inequality in Latin America during the 2000s. Indeed, it was the main contributor in countries where inequality fell more dramatically. A proper understanding of the workings of the labour market is necessary to comprehend why inequality fell, what lies ahead of us and what we can do to achieve more equitable societies in Latin America. Social progress was real in the last decade but we should not overlook the structural deficits that still remain in Latin American labour markets. Inequality fell more dramatically in countries where formality rose faster and real minimum wages increased more significantly. Labour market institutions have a played positive role in reducing inequity in the last decade.
    Keywords: labour institutions, inequality, Latin America, minimum wage
    Date: 2012
  2. By: Damill, Mario; Frenkel, Roberto
    Abstract: This paper examines the macroeconomic policies and outcomes experienced by the Latin American economies during the period 1990-2010. Macroeconomic policies refer to exchange rates, monetary and aggregate fiscal policies, while macroeconomic outcomes, on the other hand, refer to the patterns of growth, inflation, employment, investment, balance of payments, and the evolution of external and public debts and international reserves. The analysis includes a discussion of the effects of macroeconomic outcomes on poverty rates. With regard to policy, the study examines the changes that took place in 1997-98, and then reviews the resulting new macroeconomic configuration that was established in 2002-03. This new configuration favoured the acceleration of output growth and employment creation, and contributed to reducing poverty rates.
    Keywords: Latin American economies, macroeconomic policies, economic growth, employment, poverty rates, inequality
    Date: 2012
  3. By: Ponce, Juan; Vos, Rob
    Abstract: This study examines the rise and fall in income inequality in Ecuador over the past two decades. Falling income equality during the 2000s partly coincides with the rise to power of a .new leftist. government, but the trend was already set early in the decade. The recent trend is mainly associated with a recovery from the country.s deep crisis of the late 1990s. The new leftist regime.s social transfer policies helped reduce inequality further, but the continuation of Ecuador.s primary export-based growth model and the lack of structural economic change do not augur for a more structural decline in inequality.
    Keywords: education, welfare, poverty, Ecuador
    Date: 2012
  4. By: Carlos Gustavo Machicado (Institute for Advanced Development Studies); Felix Rioja (Department of Economics, Georgia State University); Antonio Saravia (Deloitte Tax LLP)
    Abstract: We calibrate a simple neoclassical model of structural transformation to a set of Latin American countries and show that slow growth in agricultural productivity can substantially delay the development process and result in signicant dierences in per capita incomes. Some of our results indicate that low agricultural productivity delayed the beginning of the industrialization process in Paraguay and Bolivia by about 100 years compared to the leader of the group, Chile. The development pro- cess can be accelerated, however, by increasing productivity in the non-agricultural sector. In fact, in the long run, it is non-agricultural productivity what determines the speed of convergence. Improvements in non-agricultural productivity between 20% to over 100% would be required for the other Latin American countries in our set to signicantly close the income gap with Chile by the end of the century.
    Keywords: Economic Development, Latin America, Agriculture Productivity, Manufacturing Productivity
    JEL: O47 O57 E13
    Date: 2012–03
  5. By: Gerson Javier Pérez V.
    Abstract: Exploiting spatial and temporal variations in the number of seizures from criminal organizations, I estimate regional fixed effects models of the increase in the number of properties confiscated on the main crime rates. From 2002 security strategies changed, and as a result, the effects on crime rates are mostly large, negative and significant. There was a clear reduction in crimes commonly committed by organized criminals, including guerrillas, paramilitaries and drug-traffickers, such as auto-theft, terrorism, terrestrial piracy, and kidnappings. In contrast, crimes usually committed by common criminals, such as street robberies and burglaries were unaffected by the new security policy.
    Date: 2012–03–25
  6. By: González Vigil, Fernando; Shimizu, Tatsuya
    Abstract: The Economic Partnership Agreement (EPA) between Japan and Peru came into effect on March 1, 2012. This paper provides background information about this agreement's significance, mostly from a Peruvian point of view. It focuses on the following subjects: the statistical trends showing Peru's declining shares in Japan's trade and investment flows with Latin American countries between the mid-1970s and mid-2000s, the main explanatory factors of such a deterioration in Peru's economic position over that period, the changes of trade policy strategy in both countries since the 2000s, and the EPA negotiation process and some of its key results as featured in the text of the agreement.
    Keywords: Peru, Japan, International trade, International agreements, Free Trade Agreement
    JEL: F13 F14 P45
    Date: 2012–03
  7. By: Acevedo, Carlos; Cabrera, Maynor
    Abstract: This paper reviews the pattern of poverty rates and income inequality in El Salvador since the 1990s. It discusses some of the likely factors that explain the reduction in income inequality that has taken place in the country in the last decade, which paradoxically has coincided with the long period of economic stagnation that has followed dollarization since 2001. After examination of the available evidence, we conclude that this trend has been mainly due to the equalizing effect of migration and remittances (that is, a .private safety net. built around solidarity within families) rather than the distributive effect of public social expenditure or other public policies.
    Keywords: El Salvador; remittances; migration; inequality; poverty; labour market
    Date: 2012
  8. By: Perdomo Calvo, Jorge Andrés; Ramirez Orozco, Juan Andrés
    Abstract: The main objective of this study is to develop an economic analysis estimating the solid waste quantities and optimal hauling distance to install transfer stations in Colombia, according to landfill location. This goal is met by using a difference in differences approach (impact evaluation technique), means panel data (random effects), comparative static analysis and mathematical optimization. These methods allowed comparing total production costs between firms with and without transfer stations during three years (2006 to 2008). This study suggests that the use of a transfer station reduces maintenance and operation costs. El objetivo principal de este estudio es realizar un análisis económico para estimar el tamaño de mercado óptimo, con el fin de tomar de decisiones sobre la viabilidad de contar con una estación de transferencia (ET) y su adecuada distancia para ubicarla, de acuerdo con la longitud del trayecto a recorrer entre un sitio origen y el relleno sanitario más cercano. Lo anterior, haciendo uso del método de evaluación de impacto diferencia en diferencias, mediante un modelo de datos panel con efectos aleatorios y análisis estático comparativo de optimización matemática. Técnicas, que permitieron comparar el comportamiento de los costos totales de producción, entre firmas recolectoras de residuos sólidos con y sin estación de transferencia, en un período de tres años (2006-2008). Así, se evidenció cómo estas empresas disminuyen los gastos de operación y mantenimiento cuando implementan por lo menos una estación de transferencia.
    Keywords: Impact evaluation; solid waste; transfer stations; panel data; difference in differences; mathematical optimization
    JEL: R53 R42 Q53 R48
    Date: 2011–12
  9. By: Arturo Galindo; Liliana Rojas-Suárez; Marielle del Valle
    Abstract: Since the eruption of the global financial crisis in 2008 international setting bodies and local regulators around the world have been hard at work designing and implementing new regulatory frameworks to deal with the regulatory deficiencies that were exposed during the crisis. In particular, there is now a consensus that existing regulations in developed countries were not able to contain excessive risk-taking activities by financial institutions in this group of countries during the pre-crisis period. Among these regulations, the newly proposed set of reform measures developed by the Basel Committee on Banking Supervision (BCBS): "Basel III: A global regulatory framework for more resilient banks and banking systems" (2011) is perhaps the one that has attracted most attention worldwide because a central focus of the recommendations lies on important changes in banks' regulatory capital requirements. Where does Latin America stand with respect to capital requirements? Can banks in the region satisfy with ease the new capital requirements of Basel III or will the implementation of this new set of capital recommendations require large efforts from banks in the region? This paper deals with these questions for the case of four Andean countries: Bolivia, Colombia, Ecuador and Peru.
    Keywords: Financial Sector :: Financial Policy, Capital Requirements under Basel III, financial framework, financial reform
    Date: 2011–12

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