nep-lam New Economics Papers
on Central and South America
Issue of 2014‒06‒02
thirteen papers chosen by
Maximo Rossi
University of the Republic

  1. Exploring Trends in Labor Informality in Latin America, 1990-2010 By Leopoldo Tornarolli; Diego Battistón; Leonardo Gasparini; Pablo Gluzmann
  2. Firm Dynamics, Job Turnover, and Wage Distributions in an Open Economy By Cosar, Kerem; Guner, Nezih; Tybout, James R
  3. Mapping Crisis-Era Protectionism in Latin America and the Caribbean By Evenett, Simon J
  4. What Can Latin America Learn from Rigorous Impact Evaluations of Education Policies? By Murnane, RJ; Ganimian, A. J.
  5. The Argentina Paradox: Microexplanations and Macropuzzles By Taylor, Alan M.
  6. Regional inequalities in the impact of broadband on productivity: Evidence from Brazil By Jung, Juan
  7. Pension design with a large informal labor market: Evidence from Chile By Clement Joubert
  8. Descentralización, Esfuerzo Fiscal y Progreso Social en Colombia en el Nivel Local, 1994-2009: ¿Por qué Importa la Política Nacional? By Fabio Sánchez Torres; Mónica Pachón
  9. Fiscal policy management: the experience of Chile By Eric Parrado; Andrés Velasco
  10. Rewarding provider performance to enable a healthy start to life : evidence from Argentina's Plan Nacer By Gertler, Paul; Giovagnoli, Paula; Martinez, Sebastian
  11. Work and tax evasion incentive effects of social insurance programs. Evidence from an employment-based benefit extension By Marcelo Bergolo; Guillermo Cruces
  12. Work and Tax Evasion Incentive Effects of Social Insurance Programs: Evidence from an Employment-Based Benefit Extension By Bergolo, Marcelo; Cruces, Guillermo
  13. The hidden face of Justice: Fairness, Discrimination and Distribution in Transitional Justice Processes By Juan Camilo Cárdenas; Andrés Casas-Casas; Nathalie Méndez Méndez

  1. By: Leopoldo Tornarolli (CEDLAS, FCE - UNLP); Diego Battistón (CEDLAS, FCE - UNLP); Leonardo Gasparini (CEDLAS, FCE - UNLP); Pablo Gluzmann (CEDLAS, FCE - UNLP)
    Abstract: Labor informality is a pervasive characteristic of the labor markets in Latin America, and a central issue in the public policy debate. This paper discusses the concept of labor informality and implements alternative definitions using microdata from around 300 national household surveys in all Latin American countries. The analysis covers two decades: while labor informality, defined as lack of social protection related to employment, remained with few changes in the 1990s, there is a discernible downward pattern during the 2000s in most countries. These movements reveal a counter-cyclical behavior of labor informality, that may be linked to segmentation in the labor market.
    Date: 2014–05
    URL: http://d.repec.org/n?u=RePEc:dls:wpaper:0159&r=lam
  2. By: Cosar, Kerem; Guner, Nezih; Tybout, James R
    Abstract: This paper explores the combined effects of reductions in trade frictions, tariffs, and firing costs on firm dynamics, job turnover, and wage distributions. It uses establishment-level data from Colombia to estimate an open economy dynamic model that links trade to job flows in a new way. The fitted model captures key features of Colombian firm dynamics and labor market outcomes, as well changes in these features during the past 25 years. Counterfactual experiments imply that integration with global product markets has increased both average income and job turnover in Colombia. In contrast, the experiments find little role for this country's labor market reforms in driving these variables. The results speak more generally to the effects of globalization on labor markets in Latin America and elsewhere.
    Keywords: firm dynamics; inequality; International trade; labor market frictions; size distribution
    JEL: E24 F12 F16 J64 L11
    Date: 2013–11
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:9732&r=lam
  3. By: Evenett, Simon J
    Abstract: The resort to discrimination in the Latin American and Caribbean (LAC) region against foreign commercial interests is documented in this paper and compared to aggregate statistics for worldwide policy choice and for a comparator group of developing countries in the Asia Pacific region. LAC protectionism spiked later than in the rest of the world and, on average, the former nations resorted more to traditional protectionist tools than the latter. Within the LAC region, the heavier users of protectionism employed different cocktails of discriminatory policy instruments. An exploratory cross-country analysis of the potential macroeconomic drivers and substitutes for protectionism in LAC was undertaken. During the crisis era, resort to protectionism tended to be greater in nations that cut tariffs more during 2000-7 and that employed less aggressive fiscal stimulus packages once the crisis hit. Exchange rate depreciation appears to have complemented, rather than substituted, for protectionism.
    Date: 2013–12
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:9782&r=lam
  4. By: Murnane, RJ; Ganimian, A. J.
    Abstract: This PREAL Working Paper by Richard J. Murnane and Alejandro J. Ganimian distills four main lessons for pre K-12 education policy in Latin America from impact evaluations in developing countries throughout the world. First, reducing the costs of going to school and expanding schooling options increase attendance and attainment, but do not consistently increase student achievement. Second, providing information about school quality, developmentally appropriate parenting practices, and the economic returns to schooling affects the actions of parents and the performance of private schools. Third, more or better resources improve student achievement only if they result in changes in children’s daily experiences at school. Finally, well-designed incentives increase teacher effort and student achievement from very low levels, but low-skilled teachers need specific guidance to reach minimally acceptable levels of instruction.
    Date: 2014–01
    URL: http://d.repec.org/n?u=RePEc:qsh:wpaper:169986&r=lam
  5. By: Taylor, Alan M.
    Abstract: The economic history of Argentina presents one of the most dramatic examples of divergence in the modern era. What happened and why? This paper reviews the wide range of competing explanations in the literature and argues that, setting aside deeper social and political determinants, the various economic mechanisms in play defy the idea of a monocausal explanation.
    Keywords: divergence; finance; growth; institutions; Latin America; policies; trade
    JEL: F43 N16 O11 O54 O57 P52
    Date: 2014–03
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:9876&r=lam
  6. By: Jung, Juan
    Abstract: The aim of this paper is to perform an analysis of the impact of broadband on regional productivity in Brazil. The possibility of performing a regional approach, instead of the usual country-level analysis, constitutes an opportunity to decode the economic impact of broadband at territories which share a common institutional and regulatory framework as are the regions inside a same country. The main focus of this paper is to find out if the economic impact of broadband is uniform across all territories of the country. Results suggest that the impact of broadband on productivity is not uniform across regions, and seems to be yielding higher productivity gains for less developed regions, a result which is robust after controlling for differences in quality, network effects, human capital, sectorial composition, urbanism and the age of the workforce. Another important result verified in this paper is that faster download speed and critical mass to account for network externalities enhance of the economic impact of broadband. The fact that most underdeveloped regions in Brazil seem to be benefiting more from broadband may suggest that broadband can constitute a factor favoring regional cohesion in Brazil, although further research will be needed to confirm that asseveration.
    Keywords: Broadband, Information and Communication Technologies, Regional Productivity
    JEL: O33 O47 R11
    Date: 2014–05–23
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:56177&r=lam
  7. By: Clement Joubert (Department of Economics, University of North Carolina at Chapel Hill)
    Abstract: This paper investigates empirically the fiscal and welfare trade-offs involved in designing a pension system when workers can avoid participation by working informally. A dynamic behavioral model captures a household's labor supply, formal/informal sector choice and saving decisions under the rules of Chile's canonical privatized pension system. The parameters governing household preferences and earnings opportunities in the formal and the informal sector are jointly estimated using a longitudinal survey linked with administrative data from the pension system's regulatory agency. The parameter estimates imply that formal jobs rationing is limited and that mandatory pension contributions play an sizeable role in encouraging informality. Our policy experiments show that Chile could achieve a reduction of 23% of minimum pension costs, while guarantying the same level of income in retirement, by increasing the rate at which the benefits taper off.
    Keywords: pension reform, informality, segmentation
    JEL: J24 J26 E26 O17
    Date: 2014–03–01
    URL: http://d.repec.org/n?u=RePEc:pen:papers:14-020&r=lam
  8. By: Fabio Sánchez Torres; Mónica Pachón
    Abstract: El presente documento explora la relación entre la competencia política y el adecuado suministro de bienes públicos en un contexto descentralizado con el fin de observar si la existencia de un mayor flujo de información, producto de la competencia política, así como la existencia de una mayor oferta de opciones políticas, hacen parte del mecanismo causal para una gobernabilidad efectiva. En particular, se estudia el efecto que tiene la competencia electoral sobre los incentivos a crear capacidad fiscal y suministrar bienes públicos como educación y acueducto, de los cuales son parcialmente responsables los gobiernos locales. La hipótesis de la investigación propone que la competencia política afecta de manera positiva la fortaleza de la descentralización del municipio, medida a través de la capacidad fiscal local. A su vez, la capacidad fiscal es el factor fundamental para explicar las diferencias en el desempeño de diversos sectores entre las diferentes administraciones locales. La capacidad fiscal trae consigo mejores resultados en la implementación de políticas públicas, así como una mejor capacidad de respuesta local frente a las necesidades –armonización–, lo cual se deriva en una mayor eficiencia en el gasto local. Utilizando datos panel a nivel municipal desde 1994 hasta 2009, se muestra que, a pesar de las diferencias entre los sectores analizados, los resultados en la implementación de las políticas públicas son mejor explicados por el propio esfuerzo fiscal de los municipios más que por otros recursos recibidos por estos, como lo son las transferencias del nivel central o las regalías.
    Keywords: Descentralización, Colombia, Esfuerzo Fiscal, Sensibilidad, Competencia Política, Educación, Agua
    JEL: H71 H72 H75 H76
    Date: 2013–08–12
    URL: http://d.repec.org/n?u=RePEc:col:000089:011468&r=lam
  9. By: Eric Parrado; Andrés Velasco
    Date: 2013–12–09
    URL: http://d.repec.org/n?u=RePEc:col:000470:011510&r=lam
  10. By: Gertler, Paul; Giovagnoli, Paula; Martinez, Sebastian
    Abstract: Argentina's Plan Nacer provides insurance for maternal and child health care to uninsured families. The program allocates funding to provinces based on enrollment of beneficiaries and adds performance incentives based on indicators of the use and quality of maternal and child health care services and health outcomes. The provinces use these resources to pay health facilities to provide maternal and child health care services to beneficiaries. This paper analyzes the impact of Plan Nacer Healton birth outcomes. The analysis uses data from the universe of birth records in seven Argentine provinces for 2004 to 2008 and exploits the geographic phasing in of Plan Nacer over time. The paper finds that the program increases the use and quality of prenatal care as measured by the number of visits and the probability of receiving a tetanus vaccine. Beneficiaries'probability of low birth-weight is estimated to be reduced by 19 percent. Beneficiaries have a 74 percent lower chance of in-hospital neonatal mortality in larger facilities and approximately half this reduction comes from preventing low birth weight and half from better postnatal care. The analysis finds that the cost of saving a disability-adjusted life year through the program was $814, which is highly cost-effective compared with Argentina's $6,075 gross domestic product per capita over this period. Although there are small negative spillover effects on prenatal care utilization of non-beneficiary populations in clinics covered by Plan Nacer, no spillover is found onto their birth outcomes.
    Keywords: Health Monitoring&Evaluation,Population Policies,Disease Control&Prevention,Health Systems Development&Reform,Adolescent Health
    Date: 2014–05–01
    URL: http://d.repec.org/n?u=RePEc:wbk:wbrwps:6884&r=lam
  11. By: Marcelo Bergolo (IECON-UDELAR and CEDLAS-UNLP); Guillermo Cruces (CEDLAS-UNLP, CONICET and IZA)
    Abstract: This article studies how social insurance programs shape individual’s incentives to take up registered employment and to report earnings to the tax authorities. The analysis is based on a social insurance reform in Uruguay that extended healthcare coverage to the dependent children of registered private-sector workers. The identification strategy relies on a comparison between individuals with and without dependent children before and after the reform. The reform increased benefit-eligible registered employment by 1.6 percentage points (about 5 percent above the prereform level), mainly due to an increase in labor force participation rather than to movement from unregistered to registered employment. The shift was greater for parents with younger children and for cohabiting adults whose partners’ jobs did not provide the couples’ children with access to the benefit. Finally, the reform increased the incidence of underreporting of salaried earnings by about 4 percentage points (25 percent higher than the pre-reform level), mostly for workers employed at small firms. The increase in fiscal revenue from higher levels of registered employment was several orders of magnitude greater than the loss of revenue due to an increase in underreporting.
    JEL: J22 H26 O17
    Date: 2014–05
    URL: http://d.repec.org/n?u=RePEc:dls:wpaper:0161&r=lam
  12. By: Bergolo, Marcelo (IECON, Universidad de la República); Cruces, Guillermo (CEDLAS-UNLP)
    Abstract: This article studies how social insurance programs shape individual's incentives to take up registered employment and to report earnings to the tax authorities. The analysis is based on a social insurance reform in Uruguay that extended healthcare coverage to the dependent children of registered private-sector workers. The identification strategy relies on a comparison between individuals with and without dependent children before and after the reform. The reform increased benefit-eligible registered employment by 1.6 percentage points (about 5 percent above the pre-reform level), mainly due to an increase in labor force participation rather than to movement from unregistered to registered employment. The shift was greater for parents with younger children and for cohabiting adults whose partners' jobs did not provide the couples' children with access to the benefit. Finally, the reform increased the incidence of underreporting of salaried earnings by about 4 percentage points (25 percent higher than the pre-reform level), mostly for workers employed at small firms. The increase in fiscal revenue from higher levels of registered employment was several orders of magnitude greater than the loss of revenue due to an increase in underreporting.
    Keywords: labor supply, work incentives, social insurance, tax evasion
    JEL: J22 H26 O17
    Date: 2014–05
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp8198&r=lam
  13. By: Juan Camilo Cárdenas; Andrés Casas-Casas; Nathalie Méndez Méndez
    Abstract: This article contributes to the literature on the impact of transitional justice measures using microfoundational evidence from experiments. We argue that there is a distributional dilemma at the heart of transitional justice programs, given that the State must allocate goods and services both to victims and ex-combatants. Individual and social preferences over these processes matter, given that they are likely to scale up to undermine or increase public support for transitional justice programs. We offer evidence from the Colombian case, to show what we call the hidden face of justice effect, which occurs when in the transition from war to peace distributional dilemmas arise and generate a social sanction function that creates negative incentives that can affect the achievement of reintegration of ex-combatants and jeopardizes the maintenance of peace. In order to explore the microfoundations that underlie the differences between allocations to victims and ex-combatants, we use a database built by Cárdenas et. al (2008) and find that ex-combatants expect lower transfers from public officers and indeed receive lower transfers, if compared to the victims and the control groups included in the study, despite the fact that third-party observers have the power to punish senders when making offers seen by the third-party as unfair. Keywords: Transitional justice, fairness, field experiments, third-party punishment game
    Keywords: Transitional justice, fairness, field experiments, third-party punishment game
    JEL: C93 D03 D63 D64 D74 H56
    Date: 2013–08–02
    URL: http://d.repec.org/n?u=RePEc:col:000089:011470&r=lam

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