Abstract
ABSTRACTThis article examines how government policy affects the sustainability and inclusiveness of national development after the boom. The impact of the latest commodity boom (2003-2014) on the sustainability and inclusiveness of Latin American national development varies, but not by whether governments were ideologically left. I present the economic results of the commodity boom for the major Latin American countries, followed by the social results as measured by the reduction in poverty rates and income inequality. I examine potential countervailing economic factors that could mitigate the importance of the political economic determinants of the use of resource wealth. Finding the countervailing economic factors inadequate to explain the variation in social results, I propose that the political economy of linking resource wealth with economic and social outcomes is the key determinant. I conclude the paper with a discussion of current challenges post-commodity boom.Keywords: Commodity Boom; Poverty; Income Inequality. RESUMOEste artigo examina como a política do governo afeta a sustentabilidade e a inclusão do desenvolvimento nacional após o boom. O impacto do último boom das commodities (2003-2014) na sustentabilidade e inclusão do desenvolvimento nacional da América Latina varia, mas não pelo fato de os governos serem ideologicamente de esquerda. Apresento os resultados econômicos do boom das commodities para os principais países da América Latina, seguidos pelos resultados sociais medidos pela redução das taxas de pobreza e desigualdade de renda. Examino os possíveis fatores econômicos compensatórios que podem mitigar a importância dos determinantes político-econômicos do uso de recursos financeiros. Considerando os fatores econômicos compensadores inadequados para explicar a variação nos resultados sociais, proponho que a economia política de vincular os recursos financeiros a resultados econômicos e sociais seja o principal determinante. Concluo o artigo com uma discussão dos desafios atuais do pós boom das commodities.Palavras-chaves: Boom de Commodities; Pobreza; Desigualdade De Renda.
Highlights
This article examines how government policy affects the sustainability and inclusiveness of national development after the boom
ECONOMIC RESULTS OF THE COMMODITY BOOM Latin America is comprised of commodity exporting countries with distinct economic structures
The North American Free Trade Agreement (NAFTA), created an important manufacturing sector exporting to the United States, whose value roughly equaled that of oil exports during the commodity boom
Summary
American countries on reducing the concentration of income was erratic before the commodity boom began in 2003. The Gini index worsened in Argentina, Peru and Venezuela, remained stable in Brazil and improved in Bolivia, Colombia and Mexico; Chile and Ecuador do not provide more than one year of data. Each of these countries decreased inequality, though at different speeds and with the cautionary note about Argentine statistics and the lack of data for Venezuela. In Venezuela (we know despite the lack of data) and Brazil inequality worsened, while in Mexico and Peru the improvement experienced during the boom stagnated. No data is reported for Argentina during these post-boom years, and only four countries were able to continue to improve their Gini indices: Bolivia, Chile, Colombia and Ecuador. 3. POTENTIAL COUNTERVAILING FACTORS After the commodity boom there could be various elements that could take up some of the slack, including domestic savings, foreign direct investment, and Chinese official loans. I exclude international capital flows into financial markets because of their inherent instability and contribution to capital flight that can rapidly undermine a domestic economy (such as occurred in Argentina from 1999-2001)
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