Structural transformation and productivity in Latin America
-
Pedro Cavalcanti Ferreira
and
Leonardo Fonseca da Silva
Abstract
This article examines the effects of sectorial shifts and structural transformation on the recent productivity path of Latin America. We use a four-sector (agriculture, industry, modern services and traditional services) general equilibrium model calibrated to the main economies in the region. The model very closely replicates labor reallocations across sectors and the growth of aggregate labor productivity from 1950 to 2005. Structural transformation explains a sizeable portion of the region’s convergence in the first decades. In most cases, the poor performance of the traditional services sector is the main cause of the slowdown in productivity growth observed in the region after the mid-1970s and is a key factor in explaining the divergence during this period.
Acknowledgments
The authors would like to thank Tiago Cavalcanti, Fernando Veloso, Marcelo dos Santos, Carlos Costa and an anonymous referee for the comments and CAPES, Faperj and INCT-CNPQ for the financial support.
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©2015 by De Gruyter
Articles in the same Issue
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Articles in the same Issue
- Frontmatter
- Advances
- International specialization and the return to capital
- How the wage-education profile got more convex: evidence from Mexico
- Contributions
- Africa’s missed agricultural revolution: a quantitative study of the policy options
- Structural transformation and productivity in Latin America
- Public debt and growth in the euro area: evidence from parametric and nonparametric Granger causality
- Transition dynamics in the neoclassical growth model: the case of South Korea
- Household saving in Australia
- An ordered probit analysis of monetary policy inertia
- Fiscal shocks, the real exchange rate and the trade balance: some evidence for emerging economies
- Topics
- Remittances and financial institutions: is there a causal linkage?
- Club convergence in Latin America
