Economic reform and progress in Latin America and the Caribbean

Abstract

In the late 1980s, after decades of poor economic management, many Latin American and Caribbean countries are experiencing a process of structural reform that places them on a path to a superior economic performance. The purpose of this paper is to examine the experience of structural reform in five areas of economic activity, namely, international trade, financial markets, labor markets, generation and use of public resources, and governance. The methodological approach used in the study consists of developing quantitative indicators for the corresponding policy reforms and/or their respective outcomes. The result is an empirical characterization of the structural reform experience in the region. The study concludes that the area where most progress has been achieved is international trade liberalization and the area of least progress is labor market regulations. In all areas, although much has been accomplished in the last few years, comparison with Asian NICs and OECD countries reveals that substantial room for improvement remains. JEL classification: O10, O54, E60