Crises and Growth: A Latin American Perspective

43 Pages Posted: 14 Apr 2007 Last revised: 15 Apr 2014

See all articles by Sebastian Edwards

Sebastian Edwards

University of California, Los Angeles (UCLA) - Global Economics and Management (GEM) Area; National Bureau of Economic Research (NBER)

Date Written: April 2007

Abstract

In this paper I use historical data to analyze the relationship between crises and growth in Latin America. I calculate by how much the region's GDP per capita has been reduced as a consequence of the recurrence of external crises. I also analyze the determinants of major balance of payments crises. The main conclusion is that it is unlikely that Latin America will, on average, experience a major improvement in long run growth in the future. It is possible that some countries will make progress in catching up with the advanced nations. This, however, will not be the norm; most Latin American countries are likely to fall further behind in relation to the Asian countries and other emerging nations. Not everything, however, is grim. My analysis also suggests that fewer Latin America countries will be subject to the type of catastrophic crises that affected the region in the past. Latin America's future will be one of "No crises and modest growth."

Suggested Citation

Edwards, Sebastian, Crises and Growth: A Latin American Perspective (April 2007). NBER Working Paper No. w13019. Available at SSRN: https://ssrn.com/abstract=979924

Sebastian Edwards (Contact Author)

University of California, Los Angeles (UCLA) - Global Economics and Management (GEM) Area ( email )

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National Bureau of Economic Research (NBER)

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