lectures 7
TRANSCRIPT
- 1. A brief history of Latin American Economics
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- Latin American Development
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- Development?
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- Measurements
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- Poverty
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- Inequalities
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- Human Development Index (HDI)
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- Capabilities
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- Definitions
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- Rostow
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- International emphasis
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- Newer views
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3. 4. 5. Why is Latin America considered an LDC?
- Economic factors of production
- K Capital
- L Labour
- T Land
- E Entrepreneurship
- Lack of Investment? Insecure property? Protectionism or foreign influence? Low technology?
6.
- Colonial states:
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- Extractive states Latin America funds counter-reformation
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- Anti-industrialization
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- Anti-trade
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- No system of checks and balances
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- Contrast to North American settlers
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- 16 thC
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- Mining
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- Looting to tribute
- 17 thC
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- International competition
- 18 thC
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- Bourbon/Pombal reforms trade and industry
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- Costs of independence
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- Building national economies
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- Fights between conservatives and liberals
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- Neo-imperialism vs role of elites
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- Exporting primary goods
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- Backward bending supply curves
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- Market shifts
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- 1850-post WWII exports grow 4% per year.
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- Led by industrialization of the North
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- Regional inequalities
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9.
- Great Depression
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- D commodities
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- foreign currency
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- St intervention new deal, Keynes
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- Rural-urban migration
- WWII
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- D raw materials
10. ISI Import Substitution Industrialization
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- Singer-Prebisch thesis
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- Deteriorating terms of trade
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- Zero-sum game
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- Autarky
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- Improve BoP
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- Easy to implement
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- Results
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- Problems
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- ISI problems:
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- Lack of strategic implementation
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- Rent seeking
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- Lack of progress into later stages
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- Worsened BoP
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- Overvalued exchange rate
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- Limited markets
- International lending
- Cold War
12. The Oil Crises
- 1973 Pdue to OPEC embargo
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- Petrodollars banks NEED to lend
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- Inflationv growth
- 1979 Pas a result of the Iranian revolution
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- Vs inflation, increase interest rates
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- oil P (later)
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- D for Latin American products
13. 1980s Thelostdecade
- Sudden stop to international lending
- 1982 Mexico cannot service its debt
- Decade lost in re-scheduling debt
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- New loans to pay off interest on previous loans
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- No new investment in development
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- Cut back on social investment
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- $500 for every man, woman and child in Latin America
14. Washington Consensus
- Stabilization
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- IMF led
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- inflation,G,M
- Structural adjustment WB led
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- Open the economy
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- Trade
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- Financial markets
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- Labour?
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- Quick solution -- Privatization
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- Controversial
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- Kuznets inverted U
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- Liberalization leads to growth]
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- Order of liberalization financial runs
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- China, Asian Tigers
- Turn to the left
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- Inequality
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- Limited internal industries
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- Short-lived, limited industries
16.
- Regional trade agreements
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- Mercosur
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- NAFTA
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- FTA
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- Promises
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- Problems
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