This report details the divergent paths that the world economy may take and their potential effects on Latin America and the Caribbean. Scenarios are constructed employing a modeling exercise that captures the trade, financial and other linkages between the region and the rest of the world....

Latin America`s enormous endowment of natural resources impacts many countries of the region. Economic liberalization in several countries was followed by rapid growth of foreign investment and exports of natural resource-intensive products. Growth of labor-intensive manufacturing industries was...

Information and communication technologies (ICT)--cell phones, computers, Internet--hold great promise but greater access alone cannot bring about economic development. This is a major finding of the IDB`s latest edition of its flagship Development in the Americas series titled Development...

Recent empirical and theoretical literature on the impact of real exchange rate devaluations on economic performance questions the traditional expansionary effect generated within standard Mundell-Fleming models. Contractionary devaluations may arise when firms face maturity or currency...

While Mexico has potential to grow rapidly, its economic growth has remained low for the past three decades. There is no consensus on the countrys development path or on how to achieve specific goals. Since the policy debate remains ideological and lacks pragmatism, productive development...

This paper combines development and growth accounting exercises with economic theory to estimate the relative importance of total factor productivity and the accumulation of factors of production in the economic development performance of Latin America. The region's development performance is...

This issue of IDEA explores the workings of democratic institutions in Latin America and how they shape economic and other policies. It analyzes the roles, incentives, capabilities and interaction of key political players: the legislature, business, organized labor and the media. Based on a...

Banking authorities must resolve or otherwise deal with existing banks that are weak or insolvent without imposing costs on consumers or taxpayers. Two aspects of this concern should be delineated. First, how can banking regulations be structured so that the future exit of weak and insolvent...

This paper investigates how changes in trade linkages between China, Latin America, and the rest of the world have altered the transmission of international business cycles to Latin America. Evidence based on a GVAR model for five large Latin American economies shows that the long-term impact of...

There is widespread concern that recent increases in international food prices may have significant effects on domestic food prices and inflation. This note assesses the impact of the recent food price shock on food, non-food and consumer inflation in the countries of Latin American and the...