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Towards Effective Social Insurance in Latin America: The Importance of Countercyclical Fiscal Policy

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  • Miguel Braun

    (CIPPEC)

  • Luciano di Gresia

    (Universidad Nacional de La Plata)

Abstract

Latin America is a volatile, crisis-prone region, with limited and inadequate social insurance. Therefore, the long-term as well as the recent poor suffer significantly during crises. Furthermore, social spending is procyclical in the region, but less so than total spending, indicating that the effectiveness of compensatory social policies designed to protect those vulnerable to crises is constrained by adjustments during recessions. The causes of procyclical fiscal policy lie in the political constraints on saving during expansions, combined with limited creditworthiness during recessions, and enhanced by economic volatility and a low share of automatic stabilizers in the budget.

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Bibliographic Info

Paper provided by EconWPA in its series Public Economics with number 0410001.

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Length: 62 pages
Date of creation: 05 Oct 2004
Date of revision:
Handle: RePEc:wpa:wuwppe:0410001

Note: Type of Document - pdf; pages: 62
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Web page: http://128.118.178.162

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Cited by:
  1. Margaret Grosh & Carlo del Ninno & Emil Tesliuc & Azedine Ouerghi, 2008. "For Protection and Promotion : The Design and Implementation of Effective Safety Nets," World Bank Publications, The World Bank, number 6582, August.
  2. Carlos Scartascini & Ernesto Stein & Mariano Tommasi, 2008. "Political Institutions, State Capabilities and Public Policy - International Evidence," Research Department Publications 4608, Inter-American Development Bank, Research Department.
  3. Leonardo Gasparini, 2003. "Argentina´s Distributional Failure: The role of Integration and Public Policies," CEDLAS, Working Papers 0001, CEDLAS, Universidad Nacional de La Plata.
  4. Franklin Huaita & Manuel Agosín Trumper, 2007. "Why Should Emerging-Market Countries (Still) Concern Themselves With Capital Inflows?," Working Papers wp268, University of Chile, Department of Economics.
  5. Carlos Scartascini & Mariano Tommasi & Ernesto H. Stein, 2008. "Veto Players, Intertemporal Interactions and Policy Adaptability: How Do Political Institutions Work?," Research Department Publications 4593, Inter-American Development Bank, Research Department.
  6. Carlos Scartascini & Mariano Tommasi & Ernesto H. Stein, 2008. "Un Enfoque Intertemporal Interactions and Policy Adaptability: How Do Political Institutions Work?," Research Department Publications 4594, Inter-American Development Bank, Research Department.
  7. Paolo Manasse & Ugo Panizza & Laura Dos Reis, 2007. "Targeting the Structural Balance ," IDB Publications 6722, Inter-American Development Bank.
  8. World Bank, 2005. "Argentina : Sources of Growth, Seeking Sustained Economic Growth with Social Equity," World Bank Other Operational Studies 8329, The World Bank.
  9. Xiaohui Hou & Edit V. Velényi & Abdo S. Yazbeck & Roberto F. Iunes & Owen Smith, 2013. "Learning from Economic Downturns : How to Better Assess, Track, and Mitigate the Impact on the Health Sector," World Bank Publications, The World Bank, number 16054, August.
  10. Leonardo Gasparini, 2003. "Argentina's Distributional Failure: The Role of Integration and Public Policy," IDB Publications 42798, Inter-American Development Bank.

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