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Growth, employment, and poverty in Latin America PDF

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Growth, Employment, and Poverty in Latin America UNU World Institute for Development Economics Research (UNU-WIDER) was establishedbytheUnitedNationsUniversityasitsfirstresearchandtrainingcentre andstartedworkinHelsinki,Finland,in1985.Themandateoftheinstituteisto undertakeappliedresearchandpolicyanalysisonstructuralchangesaffectingdevel- opingandtransitionaleconomies,toprovideaforumfortheadvocacyofpolicies leadingtorobust,equitable,andenvironmentallysustainablegrowth,andtopro- motecapacitystrengtheningandtraininginthefieldofeconomicandsocialpolicy- making.ItsworkiscarriedoutbystaffresearchersandvisitingscholarsinHelsinki andvianetworksofcollaboratingscholarsandinstitutionsaroundtheworld. UnitedNationsUniversityWorldInstitutefor DevelopmentEconomicsResearch(UNU-WIDER) Katajanokanlaituri6B,00160Helsinki,Finland <www.wider.unu.edu> Growth, Employment, and Poverty in Latin America Guillermo Cruces, Gary S. Fields, David Jaume, and Mariana Viollaz AstudypreparedbytheUnitedNationsUniversityWorldInstitute forDevelopmentEconomicsResearch(UNU-WIDER) 1 Comp.by:EElangovan Stage:Revises1 ChapterID:0003036260 Date:3/3/17 Time:09:54:47 Filepath:d:/womat-filecopy/0003036260.3D Dictionary:OUP_UKdictionary 4 OUPUNCORRECTEDPROOF–REVISES,3/3/2017,SPi 3 GreatClarendonStreet,Oxford,OX26DP, UnitedKingdom OxfordUniversityPressisadepartmentoftheUniversityofOxford. ItfurtherstheUniversity’sobjectiveofexcellenceinresearch,scholarship, andeducationbypublishingworldwide.Oxfordisaregisteredtrademarkof OxfordUniversityPressintheUKandincertainothercountries ©UnitedNationsUniversityWorldInstituteforDevelopmentEconomicsResearch (UNU-WIDER)2017 Themoralrightsoftheauthorshavebeenasserted FirstEditionpublishedin2017 Impression:1 Somerightsreserved.Thisisanopenaccesspublication.Exceptwhereotherwisenoted, thisworkisdistributedunderthetermsofaCreativeCommonsAttribution-Non Commercial-ShareAlike3.0IGOlicence(CCBY-NC-SA3.0IGO),acopyofwhich isavailableathttps://creativecommons.org/licenses/by-nc-sa/3.0/igo/. Itispermittedtoreuse,shareandadaptthiswork,subjecttothefollowingterms: Attribution-appropriatecreditisgiventotheoriginalwork,thecopyrightholder andcreator,andanychangesmadetotheworkareproperlyindicated. Non-Commercial-thework,oranyadaptationofthework,maynotbeused, distributedorreproducedinanyformat,byanymeans,forcommercialpurposes. Share-Alike-thework,oranyadaptationoftheworkisdistributedunderthesame licencetermsastheoriginal,withaURLlinkprovidedtothelicence. EnquiriesconcerninguseoutsidethetermsoftheCreativeCommons licenceshouldbesenttotheRightsDepartment,OxfordUniversityPress, [email protected]. PublishedintheUnitedStatesofAmericabyOxfordUniversityPress 198MadisonAvenue,NewYork,NY10016,UnitedStatesofAmerica BritishLibraryCataloguinginPublicationData Dataavailable LibraryofCongressControlNumber:2016957034 ISBN 978–0–19–880108–5 Printedandboundby CPIGroup(UK)Ltd,Croydon,CR04YY LinkstothirdpartywebsitesareprovidedbyOxfordingoodfaithand forinformationonly.Oxforddisclaimsanyresponsibilityforthematerials containedinanythirdpartywebsitereferencedinthiswork. Foreword Themotivationbehindthispieceofresearchwascementedduringameeting attended by Professor Gary Fields—one of the co-editors of this book—and myself in mid-2013 where we discussed in depth the linkages between economic growth, changing employment conditions, and the reduction of poverty.Garyhasbeenworkingonthefrontierofourprofessiononemploy- ment and development issues all of his academic career, and he pointed to newinroadsanddatatobeexploredwithinthegrowth–employment–poverty nexus,focusingonLatinAmerica. Atthetimeofourexploratorydiscussionsthetargetdateforcompletionof theUNMillenniumDevelopmentGoalswaslooming,withthenumberone goal—tohalvebetween1990and2015theproportionofpeoplelivingonless than1dollaraday—havingalreadybeenachieved.ThenewPost-2015Devel- opmentAgenda,sinceadopted,wasunderintensedebate.Leadingthecharge amongtheSustainableDevelopmentGoalsistheaimtoendpovertyinallits forms everywhere, followed closely by the SDG to promote inclusive and sustainable economic growth, full and productive employment, and decent workforall.Thustheproposedresearchcouldnothavebeenmoretimelyfor theinternationalagenda.AndmoresoasUNU-WIDERwasthenlaunchinga newresearchprogramme—focusingonthe threedevelopmentchallenges of transformation,inclusion,andsustainability—whereinworkonthegrowth– employment–povertynexuswasastraightforwardfit. I hereby express my sincere appreciation of the four editors, Guillermo Cruces, Gary S. Fields, David Jaume, and Mariana Viollaz, for bringing this academic work to full fruition, and particularly for their analytical skills broughtoutsoclearlyinthisbook. UNU-WIDER gratefully acknowledges the support and financial contribu- tions to its research programme by the governments of Denmark, Finland, Sweden,andtheUnitedKingdom. FinnTarp Helsinki September2016 Acknowledgements We would like to express our gratitude to UNU-WIDER for its generous sup- port,andespeciallytoitsdirector,FinnTarp,whoencouragedusduringthe three years we worked on this book. We are also grateful to CEDLAS and its director,LeonardoGasparini,forallowingusaccesstotheSEDLACdatabaseto constructmostofthecalculationspresentedinthisbook. Manypersonsprovidedhelpfulcommentsthroughouttheprocessofwrit- ingthisbook.TheyincludeLeonardoGaspariniforcommentsonafirstdraft ofthisbook,andthefollowingcolleaguesforcommentsoncountry-specific chapters:TimGindling (CostaRica),Robert Duval-Hernández(Mexico),José Rodríguez (Peru), and Verónica Amarante (Uruguay). We would also like to thank anonymous reviewers from Oxford University Press and UNU-WIDER whose comments helped us improve our work. Participants at the UNU- WIDER 30th Anniversary Conference ‘Mapping the Future of Development Economics’,heldinHelsinkiinSeptember2015,andthe2015LACEAMeet- ing also provided useful suggestions and comments on previous versions of ourmanuscript. A group of excellent research assistants contributed to the bibliographical review. They are Ivana Benzaquén, Jessica Bracco, Cynthia Marchioni, and GermánReyes. GuillermoCruces,GaryS.Fields,DavidJaume, andMarianaViollaz Contents ListofFigures xi ListofTables xiii ListofAbbreviations xv NotesonAuthors xvii PartI. IntroductiontotheVolume 1. IntroductionandMotivationfortheProject 3 2. DataandMethodology 20 PartII. Cross-CountryAnalysis 3. ChangingLabourMarketIndicatorsandtheRateofEconomic GrowthinLatinAmericaduringthe2000s 31 4. Cross-CountryAnalysisoftheGrowth–Employment–Poverty Nexus 55 5. Within-CountryAnalysisoftheGrowth–Employment–Poverty Nexus:AdditionalEvidence 104 6. ConclusionsfromtheCross-CountryAnalysis 136 PartIII. IndividualCountryAnalysis 7. Argentina 143 8. Bolivia 161 9. Brazil 178 10. Chile 196 11. Colombia 213 12. CostaRica 232 13. DominicanRepublic 250

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