This paper explores the qualitative and quantitative implications of taxation for growth and savings in three Latin … American countries: Brazil, Chile and Mexico, studying a small open economy in the context of an endogenous growth model where … capital at a considerably lower rate than at present. Consumption should be heavily taxed in Brazil and Mexico and optimal …

scarcity of saving in LATAM, thereby increasing investment and growth. Yet, the data and several case studies suggest that the … savings and investments were taxed in an arbitrary and unpredictable way, the credibility of a new regime could not be assumed … saving and investment rates tends to be a time consuming process. This also suggests that greater political instability and …