Description

The main goals of the present report are: first, describe the main stylized facts of growth in Latin America and the Caribbean (LAC) countries compared to typical countries in the world over the 1960-2000 period. Second, we attempt to explain the economic growth performance in LAC countries using the approach in Barro and Lee (1994) and Easterly, Loayza, and Montiel (1997), which consists of linking aggregate economic, political, and social variables to growth rates in GDP per capita for a large sample of countries. We use the estimated model to project the growth rates in most LAC countries and examine whether their performance has been close to expected values. Third, we present some forecasts for the future growth performance of LAC countries considering the cross-country empirical results and using a variety of assumptions.