What challenges for development research in Latin America?

This post was written by Carolina Zuluaga, Assistant Editor Vox.LACEA

Is the Latin America and Caribbean region carrying out more research than in previous years? Are there more resources for research available in emerging countries? Is public policy more consequential with research results? The LACEA and LAMES 2013 invited session “Development Research Challenges”, sponsored by GDN, seeks to find the answers to these interrogations.

In order to make an outline of the challenges ahead for development research, globally and within Latin America, it is important to understand where we are now and what has been done in the last few years. In his intervention, Francois Bourguignon (Paris School of Economics) discusses how economic and development research has done a shift from a Macro to a Micro point of view in the last 15 years. Although Micro focused research brings unique elements to a given study such as access to micro data and to details of the behavior of agents, the universal perspective of things is lost. Hence we are losing analysis of Macro topics that are essential to economic research and that help us to pose better solutions to current problems. As a matter of example, in the case of education, we could say that we are educating more people through more effective programs, but deploying efforts in this direction does not mean we are creating more jobs for those people! In which case, it is not an all-inclusive solution to the problem but rather, we are just tackling one part of the problem. For Bourguignon, one of the main challenges for economic research is to go back to including the “big picture” in our analyses; combining thus the two lines of research, Micro and Macro.

Alan Winters (University of Sussex) highlights the impact that globalization has had on research topics in the last 10 years, going from migration and inequality to trade and investment. But recently, he says, another topic is becoming of great importance: Productivity. Future research needs to focus on productivity, especially on issues related to the environment, industrial policy and regulation, allocation of resources, infrastructure and the role of the government upon all these issues.

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Un shock de ingresos sin precedente: Lo aprovechamos?

This is a cross-post of a piece written by Gustavo Adler and Nicolás Magud (International Monetary Fund – IMF) and published on Vox LACEA

Entitled “Four Decades of Terms-of-Trade Booms: Saving-Investment Patterns and a New Metric of Income Windfall“, Adler and Magud’s paper was presented at the 18th Annual Meeting of the Latin American and Caribbean Economic Association (LACEA) and the 28th Latin American Meeting of the Econometric Society (LAMES), Mexico City October 31st – November 2nd, 2013. This post is available in Spanish.

Los fundamentos macroeconómicos de América Latina mejoraron marcadamente en la última década, ayudados por el boom de precios de materias primas que comenzó alrededor de 2002. Esto ha creado la sensación que, esta vez, los países de la región han hecho un manejo macroeconómico más prudente respecto a episodios anteriores de booms de términos de intercambio. Pero, ¿ha sido realmente así?

En un trabajo reciente, estudiamos el shock de términos de intercambio de la última década desde una perspectiva histórica, en especial comparándolo con el shock de los 1970s; y computamos una medida, muy ilustrativa, del shock de ingresos (‘ingresos extraordinarios’) asociado a estas mejoras de términos de intercambio. También documentamos los patrones de ahorro durante estos episodios y evaluamos el “esfuerzo” de los países por ahorrar dichos ingresos extraordinarios. De nuestro análisis se desprende que la magnitud de los ingresos extraordinarios derivados de este ultimo boom de términos de intercambio no tiene precedentes, al tiempo que el esfuerzo por ahorrarlo ha sido menor que en episodios anteriores.

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