2010/21 | LEM Working Paper Series | |
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On the Latin American Growth Paradox: A Hindsight into the Golden Age |
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Giorgia Barboni and Tania Treibich |
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Keywords | ||
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Growth; Development; Convergence; Factor Analysis; Latin America;Economic History; Golden Age.
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JEL Classifications | ||
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N26, O54, C38
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Abstract | ||
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In 1950, Latin American countries capabilities were promising, and the
subcontinent was thought to have a big potential for convergence. In
order to understand why this prediction was not fullled, we apply in
this paper the framework set by Fagerberg and Srholec (2008). Our
study of the economic evolution of Latin America during the Golden Age
(1950-1975) is based on historical data on economic, political and
social variables from 18 countries. We use a factor analysis to
classify our 20 indicators into ve dimensions: the level of
"industrialization", "human capital", the "macroeconomic
fundamentals", "politics" and "religion". We nd that only the quality
of human capital and the presence of Roman Catholics signicantly and
positively aected Latin American economic growth in this period, while
the determinants traditionally put forward in the empirical growth
literature, such as technical change and openness, did not. Finally,
the positive correlation between the religion and education variables
reveals that this result is partly related to the role of the Catholic
Church as an educational institution.
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