pERFORMANCE AND COMPETITIVENESS OF LATIN AMERICAN CITIES: THE PHYSICAL CAPITAL CASE

Today the urban phenomenon is present: cities generate over 80% of the global GDP, and at the same time half of the world’s population lives in cities. In the developing world, the region with the greatest proportion of people living in urban centers is Latin America and the Caribbean (Un-Habitat, 2010). Besides the physical capital, there are other elements that make Latin American cities competitive; for instance, their culture, their global appeal, and in some cases their financial maturity and economic stability. However, the most important challenge for Latin American cities is how to manage all these variables to succeed. A problem that emerges under this scenario is to discover how the physical capital contribute to the performance of Latin American cities. The purpose of this study is to identify the contribution of physical capital and their impact on the performance of Latin American cities. Performance and competitiveness are defined as elements that make a city more attractive for Foreign Direct Investment (FDI) and make it a good place to live in for its citizens. Additionally, characteristics such as social and cultural character, financial maturity, institutional effectiveness, global appeal and economic strength are constructs considered to appraise the city’s performance.