Latin American Economies Research Articles

Financialization of Land in Peripheral Countries: Disciplining Agrarian Structures and Perpetuating Macroeconomic Vulnerabilities

ABSTRACT This paper investigates how land financialization gains traction in peripheral countries, even amidst challenges like informal land ownership, unclear property rights, social conflicts, extreme land inequality, social unrest, and a primary-export economy. It unfolds in two stages: first, revisiting key concepts like 'agrarian structure' and core-periphery dependency, originally used by Latin American economists in the 1970s and 1980s to analyze land concentration, distributive conflicts, and macroeconomic vulnerabilities. Second, it identifies how land financialization influences existing agrarian structures. The goal is to clarify why, despite a disorganized institutional context, there is an increase in financial motives, roles, and agents for land control. Considering new financial innovations, policies, and institutional changes in the region, it is essential to explore the impact of finance in a new phase of dependency between core and peripheral countries, now focused on natural resource control beyond traditional macroeconomic realms.

Los inicios del boom agrícola en Buenos Aires, Argentina: Algo más que agricultura extensiva

Within the framework of the impacts of the First Globalization, which meant an integration of goods and factor markets on a global scale and good performance for Latin American economies, the following work analyzes the beginnings of the agricultural boom in the province of Buenos Aires. The importance of this process lies in the fact that, once the structural obstacles have been overcome, the Pampas region will go through a process of economic growth based on the boom in exports that will allow it as a country to converge with the most developed economies. The intention is to show how and from where agricultural production increased. Based on the handwritten records of the II Economic-Social Census of Argentina, prepared in 1895 and complementary sources, the centrality of the extensive model is clarified for the initial years since different parallel productive systems are identified (ejidos, colonies, ranches and agricultural centers) Likewise, the possible profitability equation of agricultural producers in relation to land and machinery is shown.

Environmental technology to stimulate life expectancy: A deep dive into the role of PM2.5 and carbon emission

As the Latin American economies contend with improving public health while simultaneously dealing with ecological issues, understanding the determinant of life expectancy becomes imperative. This study explores the interaction among environmental technology, economic development, cleaner energy transitions, industrial growth, particulate Matter 2.5 (PM2.5), carbon emission, and their collective impact on life expectancy across Latin American nations. The research incorporates advanced econometric approaches comprising Mean Group (MG), Pooled Mean Group (PMG), and Method of Moments Quantile Regression (MMQR). The study’s outcome established that cleaner energy transitions, Gross Domestic Product (GDP), industrialization and environmental technologies significantly improve life expectancy, especially at higher quantiles. However, the outcome highlighted that PM2.5 and carbon emissions reduce life expectancy. Additionally, this study supports the unidirectional connection between environmental technology, economic development, cleaner energy transitions, industrial growth, life expectancy, and the bidirectional connection flowing from carbon emission PM2.5 to life expectancy. The study offers a roadmap for Latin America and global economies to invest in technology, cleaner power supply and industrialization to provide a route toward sustainable development and better public health that will eventually improve their citizens’ life expectancy.

The Effects of International Orientation on the Dimensions of the Environmental Performance of Agri‐Food Companies: A Chilean Perspective

ABSTRACTLike other Latin American economies, Chile has significantly increased its presence in international agriculture markets. Agricultural commodities are primarily developed within specialized exporters or multinational enterprises and exported to several different countries. In Chile, the fruit sector accounts for almost half of total exports. Internationally oriented companies explore business opportunities in foreign markets and invest adequate resources in international operations. In addition, more internationally oriented companies could be more inclined to invest in green practices due to external pressures and, consequently, achieve higher environmental performance. In this context, environmental performance is related to the extent to which available natural resources are protected during the production, delivery, and consumption of agricultural products. To the best of our knowledge, there is scattered evidence of the relationship between international orientation and the environmental performance of agri‐food companies, especially in Latin America. Grounded on the natural resources‐based view theory, this study assessed the effects of environmental collaboration on five dimensions of environmental performance (greenhouse gas emissions, energy efficiency, food loss and waste, food quality and safety, and water footprint management) in agri‐food companies with a survey with Chilean firms. Data were analyzed using the partial least square—structural equation modeling. We found that international orientation positively influences all five dimensions of environmental performance. Our study identified that the dimension most impacted by international orientation is water footprint management, and the least impacted is food quality and safety. With the aid of multi‐group analysis, we concluded that there are no significant differences in these relationships between micro/small and medium/large companies. A significant difference was observed in food loss and waste between fruit and nonfruit producers. We expect the outcomes of this study will support exporting‐related decisions and public policies in Latin America.

Foreign capital in neo-structuralism: The subordinate internationalisation of Latin America

This article analyses the subordinate internationalisation of Latin American economies based on the foreign capital understanding in the Latin American neo-structuralism. We discuss the theoretical foundations of this tradition to examine the economic consequences of foreign capital share in the productive structure of these countries after liberalisation. We also identify new forms of susceptibility of Latin American economies through foreign dominance in domestic economic activities. There is an ambiguity in the role of foreign capital, which requires control and coordination to flourish. The State intervention is important to i) enable a positive insertion into global value chains, ii) to foster industrialisation, iii) to mitigate adverse effects of financial flows, and iv) to encourage investments against exogenous cyclical effects.

Development strategy, infrastructure, and premature deindustrialization: Comparing Asian, African, and Latin American economies

AbstractThis paper investigates the phenomenon of premature deindustrialization in developing countries, with a focus on Latin America and sub‐Saharan Africa, and examines why this trend primarily occurs in these regions rather than in East Asia. Through a comparative analysis of industrialization experiences across different economies since the 1960s, the paper argues that premature deindustrialization results from a combination of liberalization shocks, development strategies that defy comparative advantage, and inadequate infrastructure supply due to the lack of active state involvement in its provision driven by prevailing neoliberal ideas. This study empirically validates this hypothesis using country‐sector‐level data from 40 economies.

What characterizes strategy research in Latin America? A bibliometric analysis for the 1990–2023 period

Purpose This article examines strategic management research across Latin America from 1990 to 2023, addressing four critical inquiries: the themes prevalent in strategic discussions, the leading countries in strategic management (SM) publications, the defining characteristics of strategic research in major Latin American economies and the reflection on whether Latin America is a region that generates or follows the knowledge of the Global North. Design/methodology/approach Utilizing co-occurrence analysis, this study maps the terrain of SM research in the region, analyzing 4,963 articles indexed in the Scopus database. The authors employed a co-occurrence analysis to map SM research in Latin America, analyzing 4,963 articles from the Scopus database. Findings Predominant themes include the theoretical underpinnings of strategy, sustainable development, innovation, tourism and international trade. Brazil, Mexico, Colombia and Chile have emerged as leaders in research volume and thematic diversity, particularly in sustainable development and innovation. Practical implications By identifying patterns, behaviors and trends in SM research, the authors uncover methods and tools that, once contextualized for the region, can significantly enhance organizational performance. Originality/value This investigation is a pioneering effort, providing a focused analysis on SM research within Latin America. It highlights significant contributions since 1990 across the region's main economies. This study represents one of the first comprehensive mappings of this academic field within Latin America. This is the first article, to the authors’ knowledge, developed to map the intellectual structure of the SM field in Latin America through an analysis of co-occurrences, with emphasis on the region's main economies.

The Effects of Oil Price on Energy Production and the Ecuadorian Economy

Through an empirical analysis of the impact of variations in the international price of oil on the economic production of different strategic sectors and on energy production from various sources in Ecuador, the study seeks to show evidence on the economic effects of the price of oil. in a Latin American economy strongly linked to oil production. For this, relevant data were collected on production in different economic sectors, on the type of ownership in oil production and on energy production in various energy sources in Ecuador and statistical analyzes were carried out to evaluate the relationships between these and the international oil price. The results indicate that the effect of the oil price varies between the economic sectors of Ecuador. Some sectors, such as financial services and construction, show positive responses, while others, such as agriculture and fishing, appear less affected. The oil and mining sector in Ecuador is strongly linked to variations in the price of oil. The positive and significant response of the Oil and Mines GDP underlines the sensitivity of this sector to changes in international prices. Furthermore, energy production in Ecuador exhibits heterogeneous responses to variations in the price of oil. Forms of energy such as wind, solar, and thermal energy show positive and significant responses, while hydropower presents a negative response in some periods. Positive responses in forms of energy such as wind, solar, and thermal may indicate that the increase in the price of oil positively influences investment decisions in these energy sources. The study provides a significant contribution to the field of energy economics in oil-exporting countries and, particularly, in developing countries, as well as highlights the importance of energy diversification for these types of economies.

How Important are Sino-Latin American Trade for Economic Growth? A Trade in Value-Added Perspective

Sino-Latin American trade have increased substantially for decades. However, the increasing trade imbalances between China and several Latin American countries have yielded growing trade frictions. In this paper, we re-calculate the bilateral trade balance using the value-added content in trade and measure the contribution of Sino-Latin American trade to economic growth. The results show that gross trade statistics seriously overestimate the real bilateral trade imbalance, and China’s trade surplus with Mexico decreased by over 50%. The composition of Sino-Latin American trade suggests that most Latin American economies are complementary with Chinese economy. The South-South trade has been increasingly important for both China’s and Latin America’s economic development. We foresee an optimistic future of relations and continuously increasing trade between China and Latin America. Meanwhile, more efforts should be made to settle trade frictions and intensify Sino-Latin American relations.

Integrating Latin America into the Global Economy: Strategies for Regional Economic Development

The 1990s marked a transformative era for Latin American economies, characterized by significant political and institutional reforms aimed at increasing trade and financial openness. The economic development model adopted during this period emphasized market-led growth through liberalization measures, significantly reducing the state's role in the economy. However, by the decade's end, the anticipated economic and social benefits had not materialized in many countries, prompting a reevaluation of development policies. This paper revisits the theoretical frameworks proposed by the Economic Commission for Latin America and the Caribbean (ECLAC), grounded in Keynesian economics and a historical-structural methodology. ECLAC's analysis focused on the implications of deregulation and the liberalization of economic and financial policies, advocating for a regional development strategy that balances economic growth with equitable income distribution, employment opportunities, technological advancement, and social fairness. By analyzing Latin America's integration into the global economy in the 1990s, this study explores ECLAC's theoretical perspectives as viable alternatives to the reforms implemented during that period. Employing a bibliographic and reflective analytical approach, the paper underscores ECLAC's contributions to understanding the socioeconomic challenges and opportunities facing the region.

The growth contribution of colonial Indian railways in comparative perspective

AbstractRailways were an important driver of global economic growth in the nineteenth and early twentieth centuries. Whilst their role is well documented in industrial economies, we know less about their macro‐economic impact in developing countries. In this paper, we first estimate the aggregate growth impact of Indian railways, one of the largest networks in the world in the early twentieth century. Then, we compare their impact in India to four emerging Latin American economies (Argentina, Brazil, Mexico, and Uruguay) and the Cape colony. Using growth accounting techniques common to the cross‐country estimates, we argue that the aggregate growth impact of Indian railways was significant, increasing Indian gross domestic product (GDP) per capita by 13.5 per cent by 1912. We also find that the growth impact of Indian railways was similar to Brazil and Mexico, but smaller than Argentina and the Cape. Compared with the latter, India had a smaller size of railway freight revenues in the economy and lower wages to fares leading to lower passenger time savings. Railways were the most important infrastructure driver of economic growth in India during the first era of globalization from 1860 to 1912, but they contributed less than in richer and more dynamic developing economies.

Does the Minimum Wage Affect Wage Inequality? A Study for the Six Largest Latin American Economies

Minimum wage (MW) policies are widespread in the developing world and yet their effects are still unclear. In this paper we explore the effect of national MW policies in Latin America’s six largest economies by exploiting the heterogeneity in the bite of the national minimum wage across local labor markets and over time. We find evidence that the MW has a compression effect on the wage distribution of formal workers. The effect was particularly large during the 2000s, a decade of sustained growth and strong labor markets. In contrast, the effect seems to vanish in the 2010s, a decade of much weaker labor markets. We also find suggestive evidence of a lighthouse effect: the MW seems to have an equalizing effect also on the wage distribution of informal workers.

Total factor productivity, transitional dynamics and endogenous growth accounting for Latin America: Evidence from two centuries’ data

AbstractThis study investigates the sources of economic growth for Latin American economies. With two centuries of data and extended growth accounting methods, the study shows that poor total factor productivity (TFP) growth is the key to understanding Latin America's low economic growth relative to other economies. Using a functional form of TFP growth, based on second‐generation growth models, furthers analyses to show some empirical evidence for growth induced by R&D, knowledge spillovers, educational attainment and the distance to the frontier. However, the magnitude effect is very small and when compared to the OECD countries, the gap between the TFP growth generating factors is very substantial. An intricate policy structure should be implemented for Latin America to foster an environment that is conducive to aid permanent TFP and economic growth.

Real exchange rates and manufacturing exports in emerging economies: the role of sectoral heterogeneity and product complexity

The empirical evidence on the relationship between the real exchange rate and export performance in emerging economies is inconclusive. In this paper, we present evidence that one reason for this inconclusiveness is the use of real exchange rate (RER) measures that do not consider the heterogeneity between economic sectors. To this end, we calculate a unique sectoral bilateral RER index (SBRER) for 12 Latin American economies, which considers the variation of producer price differentials and bilateral nominal exchange rates across 21 manufacturing sectors and 38 trade partners between 2001–2018, and to estimate the effect of SBRER movements on manufacturing exports. The regression results show that the SBRER is a significant determinant of aggregate manufacturing exports, whereas the bilateral RER is not significant. Moreover, sectoral export elasticities indicate that mainly sectors with low levels of product complexity and, to a lesser extent, those of medium complexity are affected by RER movements. These findings show that it is important to consider sectoral heterogeneity when estimating RER export elasticities from a macroeconomic perspective.

New Methodologies for a Latin American Economic History on the 19th Century: The South-Central Andes

The economic literature of nineteenth-century Latin America has been dominated by its focus on the import-export complex and by comparisons with the United States and Western Europe, discussing why Latin America did not develop like the former regions. The use of import-export data is deficient in un- derstanding economic development of the region; comparisons about what Latin America is not does not help understanding how development occurred. Instead, the essay develops new concepts such as the internal economy, as well as methodologies and categories to analyze the changes in the Latin American economy from 1830 to 1920, using as a case study the south-central Andes.

New Methodologies for a Latin American Economic History on the 19th Century: The South-Central Andes

The economic literature of nineteenth-century Latin America has been dominated by its focus on the import-export complex and by comparisons with the United States and Western Europe, discussing why Latin America did not develop like the former regions. The use of import-export data is deficient in un- derstanding economic development of the region; comparisons about what Latin America is not does not help understanding how development occurred. Instead, the essay develops new concepts such as the internal economy, as well as methodologies and categories to analyze the changes in the Latin American economy from 1830 to 1920, using as a case study the south-central Andes.

The Impact of Corporate Governance Mechanisms on Value Creation in Family Firms: Evidence from an Emerging Economy

Corporate governance (CG) is a system by which firms are directed and controlled. Through its mechanisms, it ensures optimal levels of efficiency, exploits opportunities, and prevents conflicts of interest between directors, shareholders, and stakeholders. The studies do show a positive relationship between CG and performance, but they are conducted in developed countries with stable legal and economic environments. Thus, CG contributes to the value creation (VC) of the firms. But in family firms, the concentration of power resulting from the overlapping of its subsystems (family, business, and ownership) influences the functioning of CG, and probably, VC. Setting goals, monitoring results, or controlling performance can be some of its forms. But we do not know the influence in emerging countries.The aim of the study is to empirically analyze the financial contribution of CG mechanisms to the VC of listed family firms in a Latin American economy. The results show the importance of the size of the board of directors, the participation of independent directors, and the duality of the chief executive officer. All the latter are important, considering the high representation of the family firms, their traditional concentration of power, the level of legal or regulatory weakness level, the uncertainty and instability of market conditions. The study is relevant due to the lack of evidence in emerging markets.

The changing foreign policy dynamics of GCC States: a study through the lens of positive interdependence

Foreign policy behaviour of the GCC members is changing. The countries are embracing discussion and diplomacy rather than focusing on contention and opposition. They are looking beyond traditional partners and are diversifying their support base within the region as well as outside while expressing interest in being part of multilateral institutions. GCC countries have recognised that securing economic interests is of paramount interest and political leverages and geo-political maneuverings are secondary in the changing world and to that end are engaging with the Asian, African and Latin American economies. Further the countries have understood the significance of non-traditional issues of energy, food, water and environment security along with waste management. The paper is an attempt to study this shift through the lens of positive interdependence. Embracing positive interdependence, the states focus on mutual dependence with an intention to achieve growth and prosperity and propagating one’s national interests without intending to sabotage the interests of the other party.

Intergenerational occupational mobility in Latin American economies: An empirical approach

Identifying the determinants of intergenerational mobility is an important aim in the development literature. In this article, we examine intergenerational transmission for 6 neglected Latin American Economies (Brazil, Costa Rica, Ecuador, Mexico, Panama and Puerto Rico). We use a multinomial logit model of the determinants of choosing a white-collar job for the child of a father working in farming as compared to a child whose father had a blue- or white-collar job. We find that, in the studied countries, intergenerational occupation transmission is mainly linked to low skilled jobs. Our analysis confirms the low degree of social mobility typical of Latin America, in turn contributing to explaining the low growth rate. Our findings help identify specific target groups – talented young women coming from the agricultural sector – for developing soft skills while at primary or low secondary school and work-related skills while at high secondary school or university.

Routinization and Employment: Evidence for Latin America

We study changes in employment by occupations characterized by different degree of exposure to routinization in the six largest Latin American economies over the last two decades. We combine our own indicators of routine task content based on information from the Programme for the International Assessment of Adult Competencies (PIACC) with labor market microdata from harmonized national household surveys. We find that the increase in jobs was decreasing in the automatability of the tasks typically performed in each occupation, and increasing in the initial wage, a pattern more consistent with the traditional skill-biased technological change than with the polarization hypothesis.