IDEAS home Printed from https://ideas.repec.org/p/ags/pugtwp/331253.html
   My bibliography  Save this paper

Income Convergence under the New Economic Model: The Experience of Latin American and Caribbean Countries

Author

Listed:
  • Umakrishnan, K.U.

Abstract

The World as such and the region of Latin America and Caribbean in particular, has witnessed in recent times a turn around from import substituting inward looking growth strategy towards a liberalized open new economic policy. The emulation of the East Asian development model is in the hope that this will attain for them what it did for the newly industrialized East Asian economies viz., high rates of growth enabling bridging the income gap with the developed high income countries. However with liberalization in Latin America came increased competition, and for most of the economies in the region hitherto accustomed to basking under the umbrella of state protection this was a severe challenge. Hence after over two decades of the new economic model, it is important to see whether the Latin American and Caribbean region has indeed succeeded in meeting the challenge and reducing the income gap with the more developed countries. This paper is an attempt in this direction. The study uses the data on GDP per capita purchasing power parity (PPP) from the World Bank electronic data set, World Development Indicators for the period 1980 to 2000 for the 23 countries of Latin American and Caribbean region as well as 17 OECD countries. Information on trade and FDI also is collected from the same data source. The success of the NEM of Latin America and Caribbean region is measured here in terms of their ability to catch up with other developed countries in terms of real per capita 2 income or income convergence. Beta and Theta estimates are used in the paper as the measures of convergence. Theta convergence measure indicates an increase in the disparity between OECD and the Latin America and Caribbean region during the years preceding and following the crisis of 1984-85. However a decline can be perceived in the post reforms period. Beta convergence measure for the region as a whole does not show evidence of narrowing income gap with the OECD. However the Beta convergence measure of the sub-sample of the Latin American and Caribbean countries that were found more integrated with the world economy as compared to other countries in the region, indicate that they have been catching up with OECD countries in the recent years.

Suggested Citation

  • Umakrishnan, K.U., 2004. "Income Convergence under the New Economic Model: The Experience of Latin American and Caribbean Countries," Conference papers 331253, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
  • Handle: RePEc:ags:pugtwp:331253
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/331253/files/1714.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Babiker, Mustafa & Reilly, John M. & Jacoby, Henry D., 2000. "The Kyoto Protocol and developing countries," Energy Policy, Elsevier, vol. 28(8), pages 525-536, July.
    2. Daniel J. Graham & Stephen Glaister, 2002. "The Demand for Automobile Fuel: A Survey of Elasticities," Journal of Transport Economics and Policy, University of Bath, vol. 36(1), pages 1-25, January.
    3. Henry D. Jacoby & Richard S. Eckaus & A. Denny Ellerman & Ronald G. Prinn & David M. Reiner & Zili Yang, 1997. "CO2 Emissions Limits: Economic Adjustments and the Distribution of Burdens," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3), pages 31-58.
    4. Jonathan Haughton & Soumodip Sarkar, 1996. "Gasoline Tax as a Corrective Tax: Estimates for the United States, 1970-1991," The Energy Journal, International Association for Energy Economics, vol. 0(Number 2), pages 103-126.
    5. Henry D. Jacoby & Ian Sue Wing, 1999. "Adjustment Time, Capital Malleability and Policy Cost," The Energy Journal, International Association for Energy Economics, vol. 0(Special I), pages 73-92.
    6. Viguier, Laurent L. & Babiker, Mustafa H. & Reilly, John M., 2003. "The costs of the Kyoto Protocol in the European Union," Energy Policy, Elsevier, vol. 31(5), pages 459-481, April.
    7. Hertel, Thomas, 1997. "Global Trade Analysis: Modeling and applications," GTAP Books, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, number 7685, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Babiker, Mustafa H. & Metcalf, Gilbert E. & Reilly, John, 2003. "Tax distortions and global climate policy," Journal of Environmental Economics and Management, Elsevier, vol. 46(2), pages 269-287, September.
    2. Sergey PALTSEV & John REILLY & Trent YANG, 2010. "Air Pollution Health Effects: Toward an Integrated Assessment," EcoMod2004 330600109, EcoMod.
    3. Viguier, Laurent L. & Babiker, Mustafa H. & Reilly, John M., 2003. "The costs of the Kyoto Protocol in the European Union," Energy Policy, Elsevier, vol. 31(5), pages 459-481, April.
    4. Babiker, Mustafa & Reilly, John & Ellerman, Denny, 2000. "Japanese Nuclear Power and the Kyoto Agreement," Journal of the Japanese and International Economies, Elsevier, vol. 14(3), pages 169-188, September.
    5. Ian Sue Wing, 2000. "Limiting CO2 Emissions in a Federal System: Understanding and Mitigating the Cost of U.S. Climate Policy At the State Level," Regional and Urban Modeling 283600093, EcoMod.
    6. Moshiri, Saeed & Aliyev, Kamil, 2017. "Rebound effect of efficiency improvement in passenger cars on gasoline consumption in Canada," Ecological Economics, Elsevier, vol. 131(C), pages 330-341.
    7. Iain Fraser & Robert Waschik, 2010. "The Double Dividend Hypothesis in a CGE Model: Specific Factors and Variable Labour Supply," Working Papers 2010.02, School of Economics, La Trobe University.
    8. Webster, Mort & Paltsev, Sergey & Reilly, John, 2010. "The hedge value of international emissions trading under uncertainty," Energy Policy, Elsevier, vol. 38(4), pages 1787-1796, April.
    9. Babiker, Mustafa & Gurgel, Angelo & Paltsev, Sergey & Reilly, John, 2009. "Forward-looking versus recursive-dynamic modeling in climate policy analysis: A comparison," Economic Modelling, Elsevier, vol. 26(6), pages 1341-1354, November.
    10. Elisheba Spiller & Heather Stephens & Christopher Timmins & Allison Smith, 2014. "The Effect of Gasoline Taxes and Public Transit Investments on Driving Patterns," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 59(4), pages 633-657, December.
    11. Mohammad Haider Kamruzzaman & Takeshi Mizunoya, 2021. "Quantitative analysis of optimum corrective fuel tax for road vehicles in Bangladesh: achieving the greenhouse gas reduction goal," Asia-Pacific Journal of Regional Science, Springer, vol. 5(1), pages 91-124, February.
    12. Anas, Alex & Hiramatsu, Tomoru, 2012. "The effect of the price of gasoline on the urban economy: From route choice to general equilibrium," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(6), pages 855-873.
    13. Gurgel, Angelo Costa, 2012. "Costs of Reducing Greenhouse Gas Emissions in Brazil," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 125937, International Association of Agricultural Economists.
    14. McFarland, J. R. & Reilly, J. M. & Herzog, H. J., 2004. "Representing energy technologies in top-down economic models using bottom-up information," Energy Economics, Elsevier, vol. 26(4), pages 685-707, July.
    15. Webster, Mort & Paltsev, Sergey & Reilly, John, 2008. "Autonomous efficiency improvement or income elasticity of energy demand: Does it matter?," Energy Economics, Elsevier, vol. 30(6), pages 2785-2798, November.
    16. Onno Kuik, 2003. "Climate Change Policies, Energy Security and Carbon Dependency Trade-offs for the European Union in the Longer Term," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 3(3), pages 221-242, September.
    17. Dimitropoulos, Alexandros & Oueslati, Walid & Sintek, Christina, 2018. "The rebound effect in road transport: A meta-analysis of empirical studies," Energy Economics, Elsevier, vol. 75(C), pages 163-179.
    18. Hertel, Thomas, 2013. "Global Applied General Equilibrium Analysis Using the Global Trade Analysis Project Framework," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 815-876, Elsevier.
    19. Jonathan Gonçalves Da Silva & Angelo Costa Gurgel, 2011. "Impactos De Impostos Às Emissões Decarbono Na Economia Brasileira," Anais do XXXVIII Encontro Nacional de Economia [Proceedings of the 38th Brazilian Economics Meeting] 121, ANPEC - Associação Nacional dos Centros de Pós-Graduação em Economia [Brazilian Association of Graduate Programs in Economics].
    20. Barbara Buchner & Marzio Galeotti, 2003. "Climate Policy and Economic Growth in Developing Countries," Working Papers 2003.91, Fondazione Eni Enrico Mattei.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:pugtwp:331253. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/gtpurus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.