by javier arroyo & jonathan delgado. latin american government instability political confusion...

By Javier Arroyo

&Jonathan Delgado

Latin American government instability Political confusion Corrupt leaders Government spending unaccounted for No infrastructure for growing population Illegal policies set precedent for future Lack of job opportunities

Force population to become informal Informal sector creates own

extralegal system Economy does not have participation

of the informal sector Creates a black market for bribes,

laws, election of officials Creates lack of incentives to become

formal citizens

Jobs: abundant jobs opportunities Legal protection: rights, benefits,

laws, healthcare, etc. Stability in government Better life situation: family, schools,

more fruitful future

The prices they charge for services and goods are lower than formal businesses.

Government discourages them with policies and regulations.

The opportunity costs of becoming formal is low, therefore not profitable.

http://www.youtube.com/watch?v=-oDwx2YObqw

Immigrants provide workers here in the U.S.

Undocumented workers allow for low wages.

Cheaper labor for jobs that would not get filled by U.S. citizens.

These workers are the backbone of the U.S.

Population leaves countries due to the lack of work.

In return they receive remittances: approximately $30 million in 2004

This money goes to the poor and is consumed and not reinvested: used to buy consumer goods rather than to pay for children's education or saved to invest in small businesses.

Mexico, the biggest recipient, got $13.3 billion in remittances in 2003, a 35 percent increase over the previous year. Brazil got $5.2 billion; El Salvador, $2.3 billion; Guatemala, $2.1 billion; Ecuador, $1.7 billion; Jamaica, $1.4 billion, and Cuba and Peru, $1.2 billion each

Due to current economic conditions individuals are losing jobs and less money is being sent back home.

These countries depend and run their economy off of these funds and a decrease will handicap it.

Remittances will experience decrease over the years.

Families reunite in the U.S. and there no more need to send the remittances.

Many well educated individuals cannot perform their expertise in L.A. countries.

No demand for educated professionals, wages are better performing odd jobs.

These individuals seek to use their expertise out of home country and immigrate to the U.S.

“Human Flight”

More educated individuals produces more productivity 5-15% and less educated individuals less productivity (slow economic growth) and increases poverty.

In U.S. more educated and L.A. countries less educated.

This proves what is presently going on in the economies.

Stabilize populations. Implementation of higher wages Plan to reduce poverty and

unemployment. Keep skilled workers. LA Countries must become more

efficient.