http://www.economist.com/world/americas/displaystory.cfm?story_id=15769879
In recent decades, Latin America’s economic growth has slowed. The Inter-American Development Bank believes slow or negative productivity growth has been the main cause for slow economic growth. Their inability to increase productivity has been traced back to a lack of investment, mediocre education systems, and inefficient transportation of goods. Also the service sector remains the largest sector of Latin American economies, but productivity growth is lowest in services and higher in agriculture and industry. The region has also been plagued by high inflation, the destruction of credit, and political instability.
Chang would likely examine changes in Latin America’s economic policy to note any neo-liberal policies adopted in recent years. If Latin’ America’s developing economies were pressured to liberalize their policies and increase globalized trade, Chang would cite pre-mature Capitalism as the force behind low economic growth. However, from 2007 onwards, many Latin American economies have seen a surge in economic growth. If they have adopted protectionist policies to protect and foster their national economies, there may have been a rise in economic prosperity.
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I thought it would be interesting to find out what the Inter-American Development Bank is doing about Latin America's slow/negative productivity growth, so I looked them up online and found this statement under the "about us" header: "In addition, [the bank] also offers research, advice and technical assistance to support key areas like education, poverty reduction and agriculture. The Bank is also active on cross-border issues like trade, infrastructure and energy." I wonder what kind of advice they are giving to these countries-whether more protectionist policies or more free trade. Chang would most likely question their influence on the area and cite them as a reason for low economic prosperity.
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