nep-lam New Economics Papers
on Central and South America
Issue of 2017‒10‒01
five papers chosen by
Maximo Rossi
Universidad de la República

  1. ducational inequality and intergenerational mobility in Latin America: A new database By Guido Neidhöfer; Joaquín Serrano; Leonardo Gasparini
  2. The Implications of Exhaustible Resources and Sectoral Composition for Growth Accounting: An Application to Chile By Claudia De La Huerta; Emiliano Luttini
  3. Which Tail Matters? Inequality and Growth in Brazil By Stephan Litschig; Maria Lombardi
  4. Does the Adoption of Complex Software Impact Employment Composition and the Skill Content of Occupations? Evidence from Chilean Firms By Almeida, Rita K.; Fernandes, Ana Margarida; Viollaz, Mariana
  5. Un modelo de equilibrio general dinámico para la evaluación de la política económica en Colombia By Rodrigo Suescún; Roberto Steiner

  1. By: Guido Neidhöfer (Freie Universität Berlin, Germany); Joaquín Serrano (CEDLAS Universidad Nacional de La Plata and CONICET, Argentina); Leonardo Gasparini (CEDLAS Universidad Nacional de La Plata and CONICET, Argentina)
    Abstract: The causes and consequences of the intergenerational persistence of inequality are a topic of great interest among various fields in economics. However, until now, issues of data availability have restricted a broader and cross-national perspective on the topic. Based on rich sets of harmonized household survey data, we contribute to filling this gap computing time series for several indexes of relative and absolute intergenerational education mobility for 18 Latin American countries over 50 years, and making them publicly available. We find that intergenerational mobility has been rising in Latin America, on average. This pattern seems to be driven by the high upward mobility of children from low-educated families; at the same time, there is substantial immobility at the top of the distribution. Significant cross-country differences are observed and are associated with income inequality, poverty, economic growth, public educational expenditures and assortative mating.
    Keywords: Inequality, Intergenerational Mobility, Equality of Opportunity, Transition Probabilities, Assortative Mating, Education, Human Capital, Latin America.
    JEL: D63 I24 J62 O15
    Date: 2017–08
  2. By: Claudia De La Huerta; Emiliano Luttini
    Abstract: Standard growth accounting overlooks the role of exhaustible resources. This omission leads to overstating physical capital shares and to misleading total factor productivity (TFP). We study an application to Chile, a country dependent on mining production. First, we quantify the sources of economic growth. Second, we study TFP gains arising from changes on the economy's sectoral composition. Our results are as follows. Mining value added grows at an average annual rate of 0.69%. Productivity, physical and human capital contribute 3.75%. The exhaustible resource (ore grade) contributes -2.96%. At the aggregate level, omitting ore grade overstates the contribution of capital, 0.55%, and understates TFP growth, 0.96%. We document a composition gain of -0.53% between the mining and non-mining sectors. We obtain a 0.68% composition gain within the nonmining sector. We show that mining countries are exposed to similar sources of sectoral productivity growth as the Chilean economy.
    Date: 2017–09
  3. By: Stephan Litschig (National Graduate Institute for Policy Studies, Tokyo, Japan); Maria Lombardi (University of Gothenburg, Sweden)
    Abstract: We estimate the effect of initial income inequality on subsequent income per capita growth using sub-national data from Brazil over the period 1970-2000. Holding initial income per capita and standard confounders constant, we find that places with higher initial inequality exhibit higher subsequent growth. This effect is entirely driven by the lower tail of the initial income distribution: compared to more equal places, sub-national units with a higher share of income going to the middle quintile at the expense of the bottom quintile grow more rapidly, while places with a higher share of income going to the top quintile at the expense of the middle quintile get no growth boost at all. We document that both physical and human capital accumulation in places with higher inequality in the lower tail of the initial income distribution outpace capital accumulation in more equal places, while inequality in the upper tail of the distribution is uncorrelated with subsequent physical or human capital growth. These results are consistent with theories on credit constraints and setup costs for human and physical capital investments.
    Date: 2017–09
  4. By: Almeida, Rita K. (World Bank); Fernandes, Ana Margarida (World Bank); Viollaz, Mariana (CEDLAS-UNLP)
    Abstract: A major concern with the rapid spread of technology is that it replaces some jobs, displacing workers. However, technology may raise firm productivity, generating more jobs. The paper contributes to this debate by exploiting a novel panel data set for Chilean firms in all sectors between 2007 and 2013. While previous studies examine the impacts of automation on the use of routine tasks by middle-educated workers, this study focuses on a measure of complex software that is typically used by more educated workers in cognitive and nonroutine tasks for client, production, and business management. The instrumental variables estimates show that in the medium run, firms' adoption of complex software affects firms' employment decisions and the skill content of occupations. The adoption of complex software reallocates employment from skilled workers to administrative and unskilled production workers. This reallocation leads to an increase in the use of routine and manual tasks and a reduction in the use of abstract tasks within firms. Interestingly, the impacts tend to be concentrated in sectors with a less educated workforce, suggesting that technology can constrain job creation for the more skilled workers there. The paper concludes that the type of technology matters for understanding the impacts of technology adoption on the labor market.
    Keywords: complex software, tasks, skills, employment structure, Chile
    JEL: J23 J24 J31 O33
    Date: 2017–09
  5. By: Rodrigo Suescún; Roberto Steiner
    Abstract: Este documento presenta un modelo de equilibrio general dinámico para el análisis de la economía colombiana. A diferencia de la mayoría de modelos de equilibrio general aplicado, este integra simultáneamente (i) el modelamiento dinámico de la toma de decisiones; (ii) la posibilidad de simular política económica discrecional; y (iii) un tratamiento explícito de los encadenamientos intersectoriales en la economía. Gracias a esto, resulta idóneo para responder preguntas que no se prestan para ser estudiadas con otros modelos económicos, como los modelos de equilibrio general dinámico estocástico (DSGE) o los modelos de equilibrio general computable (CGE). El trabajo consta de cuatro capítulos. En el primero se hace una detallada revisión de la literatura, tanto teórica como de modelos aplicados al caso de Colombia. Queremos con ello hacer plena claridad respecto del vacío que pretendemos llenar con nuestro trabajo. El segundo capítulo desarrolla el modelo mientras que en el tercero se presenta la calibración de los parámetros. El cuarto capítulo se presenta un par de simulaciones para ilustrar el uso del modelo.
    Keywords: Modelos de Equilibrio General Computable, Política EconómicaEconomía Colombiana, Evaluación Económica, Colombia
    JEL: C68 D58 E60 C52 D04
    Date: 2017–07–31

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