nep-lam New Economics Papers
on Central and South America
Issue of 2018‒03‒19
six papers chosen by
Maximo Rossi
Universidad de la República

  1. The Labor Market Effects of an Educational Expansion. A Theoretical Model with Applications to Brazil By David Jaume
  2. The Industrialization of South America Revisited: Evidence from Argentina, Brazil, Chile and Colombia, 1890-2010 By Gerardo della Paolera; Xavier H. Duran Amorocho; Aldo Musacchio
  3. Spiritual Practices and Dispositional Optimism in an Underprivileged Population By Cid, Alejandro; Arrieta, Gonzalo; Ponce De León, María Mercedes; Stokes, Charles E.
  4. Effects of official and unofficial central bank communication on the Brazilian interest rate curve By Azevedo, Luis Fernando Pereira; Pereira, Pedro L. Valls
  5. Demand Shocks and Labor Market Dynamics: Firm Level Responses to a Commodity Boom By Sergio Urzua; Felipe Saffie; Felipe Benguria
  6. Desigualdad en países en desarrollo: ¿ajustando las expectativas? By Leonardo Gasparini; Jessica Bracco; Luciana Galeano; Mariela Pistorio

  1. By: David Jaume (Department of Economics, Cornell University.)
    Abstract: Most countries are rapidly increasing the educational attainment of their workforce. This paper develops a novel framework to study, theoretically and empirically, the effects of an educational expansion on the occupational structure of employment and distinct aspects of the wage distribution—wage levels, wage gaps, and poverty and inequality indicators—with an application to Brazil. I proceed in three steps. First, I provide some stylized facts of the Brazilian economy between 1995 and 2014: A large educational expansion took place; the occupational structure of employment remained surprisingly fixed; workers of all educational groups—primary or less, secondary, and university—were increasingly employed in occupations of lower ranking as measured by average wages over the period; and wages of primary educated workers increased while wages of more educated workers declined, bringing forth reductions in poverty and inequality. Second, I build a model that traces these heterogeneous patterns of occupations and wages to the educational expansion. The model assigns workers with three levels of education to a continuum of occupations that vary in complexity and are combined to produce a final good. I investigate three different policy experiments: An increase in university level, an increase in secondary level, and a simultaneous increase in both. The predicted effects depend on the policy analyzed. Considering the educational expansion that took place in Brazil (simultaneous increases in university and secondary levels), the model predicts qualitatively all the observed labor market changes in the occupational structure of employment and the wage distribution. Finally, I calibrate the model with the data from 1995 and show that, through its lens, the observed educational expansion in Brazil explains 66 percent of the occupational downgrading and around 80 percent of the changes in wage levels, inequality, and poverty during the period of 1995-2014.
    JEL: I25 J24 O15
    Date: 2018–01
    URL: http://d.repec.org/n?u=RePEc:dls:wpaper:0220&r=lam
  2. By: Gerardo della Paolera; Xavier H. Duran Amorocho; Aldo Musacchio
    Abstract: We use new manufacturing GDP time series to examine the industrialization in Argentina, Brazil, Chile, and Colombia since the early twentieth century. We uncover variation across countries and over time that the literature on industrialization had overlooked. Rather than providing a single explanation of how specific shocks or policies shaped the industrialization of the region, our argument is that the timing of the industrial take off was linked to initial conditions, while external shocks and macroeconomic and trade policy explain the variation in the rates of industrialization after the 1930s and favorable terms of trade and liberalization explain de-industrialization after 1990.
    JEL: N66 N86 O14 O24 O25 O4 O43
    Date: 2018–02
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:24345&r=lam
  3. By: Cid, Alejandro; Arrieta, Gonzalo; Ponce De León, María Mercedes; Stokes, Charles E.
    Abstract: Optimism seems to foster the ability to manage adverse situations better - a finding especially relevant for disadvantaged populations. Employing a unique sample from a small underprivileged village, we study the association between spiritual practices and dispositional optimism. The village belongs to a developing country that is, by far, the most secular country in Latin America: this makes particularly interesting exploring the role of spiritual practices in this context. We find that spiritual practices are positively associated with higher optimism, measured by the Life Orientation Test-Revised (LOT-R): those who practice spirituality, score, on average, 14.4 percentage points higher on the LOT-R than those who do not. And this association seems to be especially robust in the case of the poor and less educated: those with spiritual practices score 20 percentage points higher on the LOT-R. Thus, the role that spiritual practices may play in dispositional optimism in disadvantaged populations deserves more attention
    Keywords: Dispositional optimism, spiritual practices, LOT-R, hope, religion, happiness
    JEL: Z12
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:84642&r=lam
  4. By: Azevedo, Luis Fernando Pereira; Pereira, Pedro L. Valls
    Abstract: In order to provide greater transparency in their opinions and decisions, central banks around the world use both their official channels and the specialized media to communicate with the general public. Using an unique news dataset with intraday frequency, this paper finds evidence that the volatility of the long end of the interest curve in Brazil is higher in days of official publications on the website of the Central Bank of Brazil and that the short end is affected on days on which the president or any director of the institution is quoted in the specialized media. The effects are greater from 2014.
    Date: 2018–03
    URL: http://d.repec.org/n?u=RePEc:fgv:eesptd:470&r=lam
  5. By: Sergio Urzua (University of Maryland, College Park); Felipe Saffie (University of Maryland); Felipe Benguria (University of Kentucky)
    Abstract: This paper studies the role of labor markets in the transmission of commodity price super cycles, including the causal association between dynamic labor distortions and recessions during cycle busts. Our theoretical contributions emerge from a three-sector model of a small open economy with firm heterogeneity, entry and exit decisions, and skilled and unskilled labor. We show that during the boom, the commodity and non-tradable sectors expand, the skill wage premium narrows, and the non-commodity export sector contracts. During the bust, on the other hand, downward wage rigidity generates dynamic misallocation between sectors, triggering a persistent recession characterized by unemployment and a sluggish recovery of non-commodity exporters. This opens a door for precautionary policy during the boom. We then present empirical evidence to asses these mechanisms. In particular, we study the case of Brazil between 1996-2013, a period in which large commodity price fluctuations provided a clean quasi-natural experiment. We examine linked employer-employee data and exploit variation across commodities and across regions to measure the direct impact of commodity prices on labor market outcomes of both commodity producing firms and firms in other sectors of the economy. Our empirical evidence support our theoretical implications.
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:red:sed017:1443&r=lam
  6. By: Leonardo Gasparini (CEDLAS-FCE-UNLP & CONICET); Jessica Bracco (CEDLAS-FCE-UNLP); Luciana Galeano (CEDLAS-FCE-UNLP); Mariela Pistorio (CEDLAS-FCE-UNLP)
    Abstract: Este trabajo documenta el nivel y la evolución de la desigualdad monetaria en los países del mundo en desarrollo sobre la base de datos de Povcalnet hasta el año 2015. Durante la primera mitad de la actual década la desigualdad se redujo en promedio en las economías en desarrollo, aunque a una tasa sustancialmente menor a la experimentada durante los años dos mil. El nivel promedio actual del coeficiente de Gini se sitúa por encima del valor de principios de los ochenta, lo que evidencia las dificultades en avanzar hacia sociedades con niveles de desigualdad económica significativamente menores.
    JEL: D31 I32
    Date: 2018–03
    URL: http://d.repec.org/n?u=RePEc:dls:wpaper:0224&r=lam

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