Banco Central de ChileRevista Economía Chilena
Published Issues
Volume 7 Nº 2 August 2004
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Microeconomic Flexibility in Latin America Ricardo Caballero G. / Eduardo Engel G. / Alejandro Micco A. We characterize the degree of microeconomic inflexibility in several Latin American economies and find that Brazil, Chile and Colombia are more flexible than Mexico and Venezuela. The difference in flexibility among these economies is mainly explained by the behavior of large establishments, which adjust more promptly in the more flexible economies, especially when accumulated shocks are substantial. We also study the path of flexibility in Chile and show that it declined in the aftermath of the Asian crisis. This decline can account for a substantial fraction of the sharp fall in TFP-growth in Chile since 1997 (from 3.1 percent per year for the preceding decade, to about 0.3 percent after). Moreover, if it were to persist, it could permanently shave almost half of a percent off Chile’s structural rate of growth. |
| Evaluating Labor Market Flexibility in Chile from an International Perspective Elías Albagli I. / Pablo García S. / Jorge Restrepo L. We rank Chile in terms of labor market flexibility among a group that includes both OECD and emerging economies. We use a performance-based indicator of labor-market flexibility based on the half life of unemployment responses to macroeconomic shocks. This indicator captures the cyclical behavior of the labor market and is obtained by estimating a structural VAR (SVAR). The SVAR is identified using long-run restrictions, which are based on a simple open-economy model with labor-market rigidity. We found that Korea, Hong Kong, Chile, US, and Mexico are the most flexible economies. At the other end, our index indicates that Germany, Sweden, Spain and Colombia are the most rigid labor markets. |
| Labor Income Dynamics in Chile Cristóbal Huneeus L. / Andrea Repetto L. This paper provides an empirical analysis of individual earnings using data from the personal income survey Encuesta Suplementaria de Ingresos. We find that the predictable component of income is humpshaped over the life-cycle, and that there are strong effects from education. The unpredictable component of income can be described by a very persistent permanent shock and a transitory shock. Our estimates are built from a panel of cohorts, so we use US data from the Panel Study of Income Dynamics (PSID) to provide a magnitude for the underestimation of variances. Surprisingly, we find that the variance of the permanent shock in Chile is around one fourth of the variance in the US, a result, perhaps, of the relative rigidity of the Chilean labor market. |
| Research Notes |
| ¿Cuánto se Alejan de su Objetivo los Países que Siguen Metas de Inflación? Elías Albagli I. |
| Shocks de Inflación, Inflación Negativa y Rigidez Salarial Álvaro García M. / I. Igal Magendzo W. |
| Medición de la Generación Eléctrica en el Imacec M. Pilar Pozo F. / Felipe Stanger V. |
| Books review |
| Globalization and History. The Evolution of a Nineteenth Century Atlantic Economy de Kevin H. O’Rourke y Jeffrey G. Williamson The End of Globalization. Lessons from the Great Depression de Harold James Global Capital Markets: Integration, Crisis and Growth de Maurice Obstfeld y Alan M. Taylor Andrés Solimano R. Inflation Targeting in the World Economy de Edwin M. Truman Eric Parrado H. |
| Publications Review |
| Catastro de publicaciones recientes y resúmenes de artículos seleccionados |