Sunday, March 06, 2005

Growing Inequality in Latin America?

According to the article in the Economist, the Latam region show deviant figures in the evolution of inequality. Some major countries living political shocks performed badly in combatting injustices (Argentina, Peru, Venezuela), but the Brazilian giant reduced something its traditional gap between riches and the poorest, thanks to the investment in education during Cardoso presidencies. But reductions are really ridiculous, compared to the increases among the bad students. Another decade lost...

The Economist's article is somehow optimistic. Despite the numbers invite clearly to pessimism, the researchers at the World Bank seem to have the intuition of being at one step of closing the Pandora's box forever, and the key has a magical name: institutional reform.
"The key to reducing inequality in Latin America is institutional reform," said Guillermo Perry, the Bank's Chief Economist for Latin America and the Caribbean, and co-author of the study. "To overcome the inequality that undermines their efforts to get out of poverty, poor people must gain influence within political and social institutions, including educational, health and public services institutions. To enable them to achieve such influence, the institutions must be truly open, transparent, democratic, participatory - and strong."
That's the magical receipts that the WB uses to spell, with less results than Mr.Potter in his first year course at Howgarts. Economists tend to conclude in such utopias. So it would be easy to do it better...
The 'Inequality in Latin America and the Caribbean: Breaking with History?' document can be read and downloaded from the World Bank online library.


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