Economic variables are known to move asymmetrically over the business cycle: quickly and sharply during crises, but slowly and gradually during recoveries. Not known is the fact that this asymmetry is stronger in countries with less-developed financial systems. This new fact is documented using...

When citizens in a poor constrained society are very unequally endowed, they are likely to find it hard to agree on reforms, even though the status quo hurts them collectively. Each citizen group or constituency prefers reforms that expand its opportunities, but in an unequal society, this will...

Many Latin American nations have recently implemented liberal trade regimes, often as part of a larger set of market-oriented reforms, and have abandoned their industrialization policies based on import substitution. In the 1980s, Chile, Mexico, and Bolivia were among the continent`s first...

What are the reasons for and the costs of Latin America's volatility? Because there is no consensus on these fundamental questions, there is no consensus on the appropriate policy response to macroeconomic volatility in Latin America, and other shock-prone countries. This paper provides new...

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...

Empirical work suggests the presence of a public sector wage premium, the reasons for which are investigated in this paper. The results demonstrate a higher premium paid to women and premium decreases concurrent with skills. Job security undermines the incentive to work hard and forces the...