The lashing rains and 185-mile-per-hour winds pounding the Caribbean from Hurricane Irma; the toppled homes and flooded streets in Texas and Louisiana from Hurricane Harvey, with its tens of thousands of people made homeless and billions of dollars in property losses: it’s hard to imagine things getting much worse. Unfortunately, they almost surely will. If […]
They are like exhibits in a gallery of dread: the Tequila Crisis of 1994; the Asian and Russian crises of 1997 and 1998, and the global financial crisis of 2008. They represent moments when foreign investors pulled away from Latin America and the Caribbean; when foreign credit and investment were withdrawn and the region suffered. […]
When it comes to their savings, households want to make sure they choose a type of investment that keeps their money safe and provides a reliable return. While in developed economies these requirements can be met by a simple bank account, in Latin America lack of trust in financial institutions discourages individuals from investing their […]
To what extent is economic behavior determined by culture and to what extent by the economic environment? In an extensive IDB study entitled Saving for Development: How Latin America and the Caribbean Can Save More and Better, the authors consider culture as a possible factor in the region’s abysmally low savings rates. They enter, in […]
For two decades beginning in the 1990s, Latin American and Caribbean nations became embroiled in a debate over which type of pension system would best provide for retired seniors. Populations were expected to rapidly age. Budgets were tight, and private and national savings rates, low. A way had to be found to guarantee retirements while […]
Why do governments need to save? In large part, for some of the same reasons people and firms need to save: to invest and help their economies grow and prosper. Public saving may make up less of national saving than household or corporate saving in Latin America and the Caribbean. But it is nonetheless vital […]
Over the last three decades, Chile has led the way in promoting greater national savings in Latin America and the Caribbean. Beginning in the early 1980s with a pension reform that introduced mandatory savings through a system managed by the private sector, the country has implemented numerous measures that have boosted its savings rate. Privatizations […]
Would you be able to come up with the equivalent of US$400 in an emergency? Many people can’t. A recent survey by the United States Federal Reserve Board reveals that 47% of people in the United States can’t come up with that $400 without selling something or borrowing. That means they may be unable to […]
In 2014 the government of the small and impoverished city of Flint in the United States decided to draw its municipal water from a different river than it had been accustomed to while it waited to connect to a cheaper water system. But the new water was corrosive to water pipes, and environmental officials made […]
For decades, Latin America and the Caribbean has been a young region, with lots of people in the workforce compared to the number of elderly. But it is aging. By 2085, the region will surpass Europe as the area of the world with the highest share of elderly and, given current rates of savings, will […]
Development in the Americas (DIA)
Macroeconomic Report 2018