RESEARCH DEPARTMENT
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The IDB has researchers in many departments producing working papers on economic and social topics. Many of these documents constitute background research for the IDB’s flagship publication "Development in the Americas" prepared by the Research Department. In addition, the IDB finances and mentors studies conducted by other institutions in order to build knowledge and research capacity. All IDB working papers are peer reviewed and meet high editorial standards.

 

2022 LATIN AMERICAN AND CARIBBEAN MACROECONOMIC REPORT: From Recovery to Renaissance - Turning Crisis into Opportunity

2022 Macro Report

Coordinated by Eduardo Cavallo, Arturo Galindo, Victoria Nuguer and Andrew Powell

  • Economic growth in Latin America and the Caribbean was stronger than expected in 2021 but waned at the start of 2022. The surge in commodity prices due to the war between Russia and Ukraine will provide a boost to exporters, while imposing significant costs on commodity importers and pushing up inflation across countries.

  • The ongoing conflict, together with policy normalization in advanced economies, carries significant risks for the region. Volatility in financial markets could depress investment and bring down growth further. Policymakers need to take urgent measures to mitigate risk and boost inclusive growth. As minor fixes are unlikely to result in notable benefits, governments should consider more ambitious resets of policy frameworks.

  • This report analyzes growth prospects, fiscal and monetary policy, and the outlook for the external sector. The recommendations stress the need for a new fiscal and labor market architecture. Policymakers should seize the window of opportunity provided by the crisis to improve the outlook for the region.

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DIA 2021: TRUST - The Key to Social Cohesion and Growth in Latin America and the Caribbean

TRUST The Key to Social Cohesion and Growth in Latin America and the Caribbean

Edited by Philip Keefer and Carlos Scartascini

  • Trust is a tremendous opportunity for countries in Latin America and the Caribbean. By making trust a goal of public policy, and not simply its byproduct, countries can accelerate growth and employment. Decisions to invest, employ, produce, buy, or sell all depend on trust. The most productive, skilled, and innovative individuals have greater economic opportunities in high-trust societies. Greater trust will unleash growth.
  • Mistrust in the private sector is an obstacle to inclusive growth. It is well known that the business sector tends to distrust governments, and this hurts investment and productivity. A survey of thousands of export-oriented firms in the region reveals that distrust within firms is also an obstacle to investment and innovation.
  • Mistrust in the public sector is an obstacle to inclusive growth. Trust in governments is low in the region. Our study finds that the lack of trust makes it difficult for citizens to demand better public policies and services. A survey of thousands of public officials revealed that mistrust within public agencies, and their mistrust of citizens, reduces public sector capacity to serve citizen needs.
  • Restoring trust depends on information and empowerment. Citizens do not trust government when they are uninformed about what government is doing for them, and when they have little capacity to act together to hold government accountable. Firms do not trust each other when they can do little about opportunistic behavior. Governments should inform and empower to restore trust.

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LATEST BLOG POSTS

Women and Urban Mobility: An Unfinished Agenda
Women and Urban Mobility: An Unfinished Agenda

Many factors lie behind observed gender gaps in labor market outcomes in Latin American and the Caribbean. But one remains largely invisible: transport and urban mobility. Women in the region have greater childcare responsibilities and do more unpaid work at home than their male partners. As a study we recently conducted in the metropolitan area […]

The post Women and Urban Mobility: An Unfinished Agenda appeared first on Ideas Matter.

The Universal Factors Behind Inflation in Latin America and the Caribbean
The Universal Factors Behind Inflation in Latin America and the Caribbean

With inflation in Latin America and the Caribbean running at its hottest in two decades, the issue of where that inflation comes from and what the region’s central banks might do differently has taken on great urgency. Our newly released study arrives at a hugely important conclusion: the overwhelming bulk of inflation in the region […]

The post The Universal Factors Behind Inflation in Latin America and the Caribbean appeared first on Ideas Matter.

The Cost-Effectiveness of Early Interventions
The Cost-Effectiveness of Early Interventions

There are few things more important for children to master than literacy: the skills of reading and writing that enable them to learn other subjects, participate politically, protect their health, and enter the labor market with promising prospects. Yet about 20 percent of the global adult population is illiterate, and in Latin America, two-thirds of […]

The post The Cost-Effectiveness of Early Interventions appeared first on Ideas Matter.

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