nep-lam New Economics Papers
on Central and South America
Issue of 2014‒09‒29
nine papers chosen by

  1. Exchange Rates Contagion in Latin America By Rubén Albeiro Loaiza Maya; José Eduardo Gómez-González; Luis Fernando Melo Velandia
  2. On the Credibility of Inflation Targeting Regimes in Latin America By Rodrigo Mariscal; Andrew Powell; Pilar Tavella
  3. Vigilante Justice and Police Protocols in the Latin American South Cone By Fernando Borraz; Cecilia Chouhy; Irene Mussio; Máximo Rossi
  4. Rural poverty, vulnerability and food insecurity: The case of Bolivia By Victor Oviedo Treiber
  5. Sobre el gobierno corporativo de los organismos multilaterales de crédito By Mario Bergara; Leandro Zipitría
  6. Un estudio de segregación de los hombres afrodescendientes en el mercado laboral uruguayo By Ani Taschdjian; Daniela Vázquez Leggiadro
  7. The New Trade Environment and Trade Performance in the Caribbean By World Bank
  8. Fiscal Policy and Equality of Opportunity in Uruguay By Marisa Bucheli
  9. Cognitive and Socioemotional Skills and Wages: The role of latent abilities on the gender wage gap in Peru By Pablo Lavado; Luciana Velarde; Gustavo Yamada

  1. By: Rubén Albeiro Loaiza Maya; José Eduardo Gómez-González; Luis Fernando Melo Velandia
    Abstract: A regular vine copula approach is implemented for testing for contagion among the exchange rates of the six largest Latin American countries. Using daily data from June 2005 through April 2012, we find evidence of contagion among the Brazilian, Chilean, Colombian and Mexican exchange rates. However, there are interesting differences in contagion during periods of large exchange rate depreciation and appreciation. Our results have important implications for the response of Latin American countries to currency crises originated abroad. Classification JEL: C32, C51, E421.
    Date: 2014–09
  2. By: Rodrigo Mariscal; Andrew Powell; Pilar Tavella
    Abstract: Inflation targeting has been adopted in a set of emerging economies, including eight countries in Latin America. The success of this regime may depend critically on the credibility of the target and the expectation that the authorities will take appropriate actions if the target is breached. This paper exploits a database of inflation expectations and attempts to measure whether, for a set of inflation targeters in Latin America, expectations are well anchored. A tighter anchoring of expectations is interpreted as a gain in credibility. Also considered are the effects on the credibility of the regime if the inflation target is breached. The results indicate that while inflation expectations have not been fully anchored over the whole sample period, credibility has risen, but at the same time the cost of breaching the target has grown.
    Keywords: Monetary Policy, Economic Development & Growth, Latin America, Inflation targeting, Credibility, Expectations
    Date: 2014–08
  3. By: Fernando Borraz (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República.); Cecilia Chouhy (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República.); Irene Mussio (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República.); Máximo Rossi (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República.)
    Abstract: There is a wide debate worldwide, and particularly in Latin America with respect to citizen insecurity and the proliferation of more punitive claims from the society itself. In this article we analyze the attitude of the citizens belonging to the countries of the Latin American South Cone towardsmaintaining the law regarding persecuting and punishing criminals. In particular, we tackle the approval of vigilante justice in some circumstances and the justification of police procedures outside the law as a form of guaranteeing the capture of criminals. For this, we use the LAPOP (Latin American Public Opinion Project, Vanderbilt University) database from the year 2008. Analyzing the data using probit estimations, we observe that the approval of vigilante justice is related to the experience and particular situation of the respondent. In this sense, having beenvictimized in the last months and feeling unsafe in his or her own neighborhood increase the probability of taking that position regarding vigilantism. On the other side, sticking to police procedures is more strongly related to the general political beliefs and the level of concern for the respondents' insecurity. These findings indicate that the formation of these beliefs has a differential dynamic and that when actions outside the law have to be justified, this is distinguished based on the type of involved action and the actorwho carries it forward.
    Keywords: vigilantism, police procedures, law, South Cone, justice
    JEL: K4 K14 P37
    Date: 2013–08
  4. By: Victor Oviedo Treiber
    Abstract: Bolivia is one of the poorest countries in Latin America. This study analyzes whether rural poverty increases the incidence of food insecurity and whether food insecurity perpetuates the condition of poverty among the rural poor in Bolivia. In order to achieve this aim, the risks that households face and the capacity of households to implement coping strategies in order to mitigate vulnerability shocks are identified. We suggest that efforts by households to become food secure may be difficult in rural areas because of poverty and the vulnerability associated with a lack of physical assets, low levels of human capital, poor infrastructure, and poor health; as well as the precarious regional environment aggravating the severity of vulnerability to food insecurity.
    Keywords: Bolivian economy, rural poverty, food insecurity, poverty alleviation policies
    JEL: O2 O5 I3
    Date: 2014–09
  5. By: Mario Bergara (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República.); Leandro Zipitría (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República.)
    Abstract: The paper discuss the correspondence between the organizational form of multilateral lending institutions and its aim and performance. It is based on the microeconomic of the banking sector and identify financial and contractual risks, and alternative forms of corporate governance as an institutional response to mitigate those risks. The approach draws from the Transaction Costs Economics and is illustrated by the case of the Fondo Latinoamericano de Reserva (Latin American Reserve Fund). The Fondo is undergoing a mayor revision of its objectives, due to an expansion strategy and the strengthening of its organizational and institutional capabilities. Our main argument is that the expansion strategies under debate should incorporate as the main element considerations of their impact on the current corporate governance. Sustancial amendment of the actual corporate governance involve policymaking and operational definitions to be explicit at the decision stage. As a result, this paper suggests a cautious development expansion, which align the objectives of the institution with an appropriate and consensual development of their current capabilities, while maintaining the advantages of the current corporate governance
    Keywords: Fondo Latinoamericano de Reservas, banking, transaction costs economics, corporate governance.
    Date: 2013–12
  6. By: Ani Taschdjian (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Daniela Vázquez Leggiadro (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República)
    Abstract: Latin America is a region characterized by its racial inequality. The recent appearance in official statistics of questions about the racialascendancyof individuals, enables us to test the validity of thatassumption for Uruguay. For the quantification of the wage gap between white and African descendants, this paper estimates a Mincer wage equation, with extra variables that aimed to capturewage discrimination due to segregation by occupation, by branch of industry and by establishment as well as other ways of discrimination. Using the National Household Survey 2006 (Encuesta Nacional de Hogares Ampliada 2006) we found that the hourly wage of African descendantmenis on average 24.8% less than the ones of white men. This gap in wages primarily consists of three main factors: 28.6% is due to segregation; 31.9% to discrimination that is channeled in other ways; and the rest to differences in workers? characteristics. In particular, differences in human capitalare very important: 25.8% of the gap is explained by differences in education and work experience of both groups.
    Keywords: discrimination, racial segregation, wage gap
    JEL: J3 J7
  7. By: World Bank
    Keywords: Environmental Economics and Policies International Economics and Trade - Free Trade Economic Theory and Research Private Sector Development - Emerging Markets International Economics and Trade - Trade Policy Macroeconomics and Economic Growth Environment
    Date: 2014–06
  8. By: Marisa Bucheli (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República)
    Abstract: According to the standard indicators of distributive effect, Uruguayan fiscal policy (in particular, social spending) is progressive. The aim of this paper is to compare this result with the conclusions derived from the perspective of equality of opportunity. Under this view, fiscal policy should equalize not the overall income but eliminate the effect of factors beyond the responsibility of individuals (circumstances). To assess the distributive effect of fiscal policy we calculate the Gini index for different income concepts which take into account different programs of the tax-benefit system. Then, we calculate the equality of opportunity for each income concept. Circumstances identified in this paper are the level of education attained by parents and self-reported ethnicity. To analyze the robustness of the results, we calculate several measures used in the empirical literature of equality of opportunities. Though according to the welfarist analysis we conclude that the tax-benefit system has an equalizing effect, we cannot conclude that it compensates the disadvantages due to circumstances.
    Keywords: equality of opportunity, distributive effect, fiscal policy
    JEL: D3 D63 H5
    Date: 2014–02
  9. By: Pablo Lavado (Universidad  del Pacífico); Luciana Velarde (Universidad  del Pacífico); Gustavo Yamada (Universidad  del Pacífico)
    Abstract: Literature provides evidence on the positive connection between cognitive test scores and higher wages. Fewer and newer papers have explored the correlation between socioemotional test scores and wages. However, attention is focused on developed countries. Test scores suffer two limitations. First, they can be considered outcomes of the schooling level and latent (unobserved) cognitive and socioemotional abilities. Second, they are potentially measured with error. The main objective of this paper is to identify latent abilities and explore their role in the gender wage gap in a developing country: Peru. The main identification strategy relies on exploring panel data information on test scores and arguing that time dependence across measures is due to latent abilities. We exploit two databases Young Lives Study and the Peruvian Skills and Labor Market Survey (ENHAB). Young Lives has panel data information on test scores and ENHAB has cross-sectional information on test scores and wages. Results show that when accounting for differences in actual latent ability socioemotional abilities account for important inter-gender differences in the endowment and returns of abilities. Moreover, inter-gender differences in latent abilities play an important role not only in wage profiles, but in schooling, employment and occupation decisions.
    Date: 2014–08

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