nep-lam New Economics Papers
on Central and South America
Issue of 2025–05–26
three papers chosen by
Maximo Rossi, Universidad de la RepÃúºblica


  1. Globalization, Technological Change and Market Power in Latin America: Evidence for Chile and Colombia By Bracco, Jessica; Brambilla, Irene; Cerimelo, Manuela; César, Andrés; Falcone, Guillermo
  2. Enforcing Compliance with Labor Regulations and Firm Outcomes: evidence from Brazil By Thaline do Prado; Marcelo Santos; Bernardus Van Doornik
  3. Welfare Conditionality in the OECD and in Latin America: A Comparative Perspective By Immervoll, Herwig; Antía, Florencia; Knotz, Carlo; Rossel, Cecilia

  1. By: Bracco, Jessica; Brambilla, Irene; Cerimelo, Manuela; César, Andrés; Falcone, Guillermo
    Abstract: This paper studies concentration and market power in Chile and Colombia and the role that globalization and automation have had in shaping these two phenomena. Using panels of firm surveys, we compute firm-level markups and industry-level concentration measures. Applying a difference in differences methodology that relies on variation across industries in exposure to robotization technology, import competition from China and tariff declines in US markets due to the signature of free trade agreements, we study the causal effects of these shocks on market power and concentration. We find that, while robotization technology has reduced markups on average, it has increased markups and total factor productivity of top industry firms; that the pro-competitive effect of Chinese imports has indeed led to a decrease in market power of domestic firms; and that increased export opportunities due to free trade agreements have led to an increase in market power, with interesting heterogeneities across the two countries.
    Keywords: Mark-ups;Market concentration;trade agreements;Robotization
    JEL: L11 F14 F61 O33
    Date: 2025–05
    URL: https://d.repec.org/n?u=RePEc:idb:brikps:14099
  2. By: Thaline do Prado; Marcelo Santos; Bernardus Van Doornik
    Abstract: We study the impacts of enforcing compliance with labor regulations on firm dynamics by combining firm-level administrative records and labor inspection data on formal Brazilian establishments committing “unregistered employee” infractions. We first provide suggestive evidence that inspected firms employing informal workers are more likely to exit following a labor inspection, compared to firms never penalized for such infractions. Next, we apply a difference-in-differences framework using firms not yet penalized for “unregistered employee” infractions as the control group to estimate the effect of labor inspections on firm-level outcomes. We find that formal employment and formal labor hiring experience a positive spike in the year of the inspection, indicating the formalization of unregistered employees. However, formal employment declines steadily over time, dropping nearly 60% by the fourth year after inspection. Among firms with active bank relationships, revenue falls sharply by about 24% over the same period. We also observe a persistent reduction in the outstanding loan amount and significant rise in the non-performing loan ratio. The average formal wage drops by about 1% in the year of inspection, but returns to pre-inspection levels in later years. Our findings are consistent with firms reducing their overall labor usage due to higher labor costs, which arise from increased compliance with labor regulations following a labor inspection.
    Date: 2025–04
    URL: https://d.repec.org/n?u=RePEc:bcb:wpaper:622
  3. By: Immervoll, Herwig (OECD, Paris); Antía, Florencia (Universidad de la República, Uruguay); Knotz, Carlo (Bremen International Graduate School of Social Sciences); Rossel, Cecilia (Universidad de la República, Uruguay)
    Abstract: Cash benefit programmes have increasingly emphasised conditionality and “demanding” forms of activation in recent decades. Behavioural requirements are now a key element in reforms of unemployment benefits (UB) and related out-of-work benefits in high-income OECD countries, and they are the defining feature of Conditional Cash Transfer (CCT) programs in many emerging economies, notably in Latin America (LA). In existing research, developments in the two regions have been studied separately from each other, limiting our understanding of commonalities and differences as inputs into policy debates and theory development. We address this gap using three comparative and longitudinal databases on benefit conditionality rules and policy trajectories in Europe, North America, Australasia, and LA. Behavioural requirements varied markedly across regions. They were initially less stringent for LA’s CCTs than for UB programmes in OECD countries, but the gap has narrowed as requirements in LA’s CCT programmes became more demanding. The strictness of requirements was more volatile in LA than in other regions. Although strictness initially varied strongly across LA, the region recently saw faster convergence than high-income OECD countries.
    Keywords: welfare conditionality, OECD, Latin America, comparative analysis, activation, unemployment benefits, CCT
    JEL: I38 J08 J68 J65
    Date: 2025–04
    URL: https://d.repec.org/n?u=RePEc:iza:izadps:dp17869

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