Benchmarking the Determinants of Economic Growth in Latin America and the Caribbean

The Latin America and Caribbean (LAC) region has seen a decade of remarkable growth and income convergence. Growth has been a key driver for reducing poverty and boosting shared prosperity. It has been debated how much of this decade of growth has...

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Bibliographic Details
Main Authors: Araujo, Jorge Thompson, Brueckner, Markus, Clavijo, Mateo, Vostroknutova, Ekaterina, Wacker, Konstantin M.
Format: General Economy, Macroeconomics and Growth Study
Language:English
en_US
Published: World Bank, Washington, DC 2015
Subjects:
Online Access:http://documents.worldbank.org/curated/en/2014/12/23791726/benchmarking-determinants-economic-growth-latin-america-caribbean
http://hdl.handle.net/10986/21318
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Summary:The Latin America and Caribbean (LAC) region has seen a decade of remarkable growth and income convergence. Growth has been a key driver for reducing poverty and boosting shared prosperity. It has been debated how much of this decade of growth has been driven by policy reforms and how much was due to the favorable external conditions. While external factors were supportive and relevant, the effect of domestic policies was just as relevant for explaining LAC's recent growth performance. The emphasis of domestic policy has shifted from stabilization policies to structural policies. In addition, a benchmarking exercise reveals which policy gaps will lead to the highest potential growth-payoffs for each country and helps identify potential trade-offs. The authors analyze growth in LAC using descriptive statistics and growth econometrics. The authors use these results for explaining the pattern of growth in LAC over the last decade, for looking ahead, and to identify potential policy gaps.