INSTITUTIONS, EXPONENTIAL TRADE, AND EQUALITY IN THE AGE OF ALGORITHMS
In a world in which globalization is being called into question, especially in developed countries, Latin Americans appear to be committed to regional integration, globalization, and free trade. These conclusions emerged from “Techno-Integration in Latin America: Institutions, Exponential Trade, and Equality in the Age of Algorithms,” a new study which was undertaken as part of the Regional Public Goods (RPGs) program at the IDB’s Institute for the Integration of Latin America and the Caribbean (INTAL), part of the Integration and Trade Sector (INT).
The main source of data for the study came from the survey that Latinobarómetro has been carrying out in 18 Latin American countries for over 20 years. The survey data is initially analyzed in isolation and then cross-referenced with other findings from the same survey before eventually being compared with other objective indicators from different statistical sources, some of which are compiled by international organizations.
Some of the main conclusions from the report are presented below.
- Yes to Latin America. One in every four Latin Americans believes that economic integration is important for development, and 77% are in favor of regional economic integration. At a time when protectionism, separatism, and isolationism are on the rise in other parts of the world, Latin Americans remain committed to regional economic integration.
- But Latin America isn’t the only priority. When asked about integration, Latin Americans would prefer closer ties with the United States, then with the European Union, then with China, and finally, in fourth place, with other countries in the region. This desire for greater integration with the United States correlates with levels of trade between it and Latin America and with citizens’ favorable views toward it. The same is true of China and the European Union.
- How people feel about integration coincides with the hard data on trade. The countries where people most associated economic integration with free trade and political dialogue are the countries with the most concentrated export baskets and the lowest levels of FDI.
- Pluriglobalization. Latin Americans’ support for greater openness can be understood not in economic terms but also in relation to social issues and employment: four out of every five Latin Americans believe that globalization is an opportunity for economic growth and nearly nine out of every ten are in favor of the free movement of workers in the region.
- Integration + Dialogue The soft aspects of integration, which have to do with institutional, legislative, and regulatory factors, were identified as being particularly relevant within different sector-specific convergence strategies. Although political integration ranked 15 points behind economic integration as a priority among respondents, some 62% of Latin Americans were nonetheless in favor of their country integrating politically with other countries in the region.
- New information and communication technologies (ICTs) are impacting how people feel about democracy.There are positive correlations between the numbers ofpeople who are willing to report corruption, those who use the internet or social media, and those who believe that “democracy is preferable to any other form of government.” In other words, internet access appears to be functioning as a key support factor for democracy.
- When it comes to e-commerce, there’s still a long way to go. Only 14% of respondents said they had bought or sold something online in the last month, and we found that the countries with the highest invention coefficient have the highest per-capita GDP, spend a larger percentage of their GDP on science and technology, have higher numbers of researchers per inhabitant, and have larger shares of internet users.
- Physical highways vs. information highways Most people think that regardless of whether we have decent highways or not, access to the internet is a non–negotiablepriority. Some 88% of respondents are conscious of the importance of the internet and new technologies for operating in today’s world—in other words, there is astrong awareness of the importance of the internet for development.
- Keeping the robots at bay. Some 76% of people believe that new technologies are putting our jobs at risk and 72% believe that artificial intelligence and robotics will put paid to more jobs than they create.
- The human factor. Social policies, social inclusion, and poverty were Latin Americans’ main concerns on the development agenda, garnering 49% of responses and ranking top of a list of 11 issues.
- Inequality, a perennial issue. The countries with the highest per-capita GDP and the lowest poverty levels are the ones that are most concerned about inequality and inclusion. This would seem to suggest that poverty itself is an obstacle to society identifying it as a problem.
- Fear of the unknown. Some 54% of people think that levels of tension between locals and foreigners are high or very high. Even so, residents of countries that trade more with the rest of the region tend to perceive lower levels of this type of conflict.
- Equality and gender conflict. In 2017, the universe of respondents who said that levels of conflict between men and women are high or very high reached 66%, up 10% from the previous year. Despite this, people did not identify gender equality as a major factor affecting countries’development—in fact, it ranked eighth on their list of priorities.
- Women in power. However, 72% of respondents said they were in favor of half of all congresspeople being women and 71% said the same for judges.
The opinions of Latin America
To describe and summarize the main findings of this research project, we would like to call on three citizens from the region who represent the voices of all Latin Americans.
Juan is an entrepreneur who wants greater liberalization of trade in goods and services in his country because he believes this will help his SME’s exports to grow. Like 77% of Latin Americans, Juan is in favor of economic integration and free trade.
He is also one of the 7.3% of the region’s citizens who are strongly in favor of regional integration because he believes that it is the best way to grow his business and feels that not enough effort has been made to further integration. This group of “unsatisfied” citizens is made up of people from two economic extremes: those who are doing well and want to growcommercially and those who are extremely vulnerable and perceive that their jobs are under threat and have thought about emigrating.
Sofía is one of the 90% of Latin Americans who are in favor of the free movement of workers between countries even though she acknowledges that there are tensions between locals and foreigners in her country.
Like 44% of all Latin Americans, she has a cell phone with internet access, but like most, she is not particularly anxious to try artificial meat, be operated on by a robot, or ride in a driverless car. She is very concerned that artificial intelligence might end up replacing her job.
All the same, Sofía, Juan, and nearly 90% of the region believe that universal internet access is a development priority. Like most internet and social network users, she has an open mind about regional integration and democracy and is more inclined to report corruption.
Dolores also lives in Latin America and is one of the 30% of the region’s inhabitants whose lives in poverty and is a clear example of the income inequality that still persists. She is one of the 79% of people who are aware of this inequality, and like 49% of the survey respondents, she believes that social policies, social inclusion, and poverty are the key problems on the development agenda.
Despite the major economic, social, and political differences within each country in Latin America and between countries, this report reveals that there is a common agenda that needs to be taken into account and which could set the pace for regional integration.
This social convergence can be seen in the high levels of support for regional integration and people’s desire to live in a more egalitarian society where citizens can move about freely. This society would be connected via ICTs, there would be universal internet access, democratic institutions would function better, and citizens would play a greater part in government decision-making and the legal process.
Given that this is the agenda citizens want for regional development and integration, we mustn’t lose sight of the opportunity that new technologies have brought. ICTs have helped individuals to think critically and visualize the problems that affect them, and they also have powerful potential to reinforce the trade ties between countries, strengthening democracy, and driving Latin America’sdevelopment.