In this essay the mainstream story about how resources are allocated in a market economy is challenged. The conventional view is that a change in relative prices leads to a change in the composition of output as a result of a reallocation of the stock of primary factors of production (land,...

The fact that most poor people in Latin America live in urban areas had implied that poverty in the region is regarded as largely an urban phenomenon. However, this document exposes what available data suggest: that rural poverty still is significant in many Latin American countries.