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Structural transformation and productivity in Latin America

Author

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  • Ferreira Pedro Cavalcanti
  • da Silva Leonardo Fonseca

    (FGV/EPGE – Escola Brasileira de Economia e Finanças, Praia de Botafogo 190, 1125, Rio de Janeiro, RJ, 22253-900, Brazil)

Abstract

This article examines the effects of sectorial shifts and structural transformation on the recent productivity path of Latin America. We use a four-sector (agriculture, industry, modern services and traditional services) general equilibrium model calibrated to the main economies in the region. The model very closely replicates labor reallocations across sectors and the growth of aggregate labor productivity from 1950 to 2005. Structural transformation explains a sizeable portion of the region’s convergence in the first decades. In most cases, the poor performance of the traditional services sector is the main cause of the slowdown in productivity growth observed in the region after the mid-1970s and is a key factor in explaining the divergence during this period.

Suggested Citation

  • Ferreira Pedro Cavalcanti & da Silva Leonardo Fonseca, 2015. "Structural transformation and productivity in Latin America," The B.E. Journal of Macroeconomics, De Gruyter, vol. 15(2), pages 603-630, July.
    • Handle: RePEc:bpj:bejmac:v:15:y:2015:i:2:p:603-630:n:4
    DOI: 10.1515/bejm-2014-0020
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    References listed on IDEAS

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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Transformação estrutural, serviços e política industrial
      by Pedro Cavalcanti Ferreira in Economista X on 2014-10-08 00:09:00

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    Cited by:

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    7. Néstor Adrián Le Clech, 2023. "Productive capacity and international competitiveness: evidence from Latin America and Caribbean countries," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 50(3), pages 695-724, August.
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