EconoMonitor

Ed Dolan's Econ Blog

Roubini Topic Archive: Latin America

  • Will the Dutch Disease Kill Hopes Raised by Colombia’s Free Trade Agreement?

    After a torturous journey through Congress, the United States-Colombia Trade Promotion Agreement (CTPA), first signed in 2006, came into effect on May 15 of this year. The agreement has raised high hopes in Colombia, for which the United States is by far the largest trading partner. However, while the CTPA was fighting its way through […]

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  • How the Latin Triangle Swallowed the Euro

    Back in 1996, Rudiger Dornbusch wrote a paper about the political economy of exchange rates in Latin America. He called it “The Latin Triangle”. It describes a cycle in which governments become trapped in inappropriate fixed-exchange rates that inevitably end unhappily. Latin America has put that particular form of economic instability behind it, but a […]

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  • How Intelligent Budget Rules Help Chile Prosper: Lessons for the US

    As everyone knows who has followed the current budget debate, U.S. fiscal policy needs more than a quick fix. It needs budget rules to put the debt and deficit on trajectories that are sustainable in the long run. Where better to look for workable rules than to countries that have done things right? Chile, which […]

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  • The Impossible Trinity: Why Latin America Hates QE2

    Latin America is up in arms over QE2. Brazil’s finance minister, Guido Mantega, sees the Fed’s program of quantitative easing as a form of currency manipulation on par with China’s efforts to maintain an undervalued yuan. We hear dark talk of currency wars and threats to raise the issue with the G20, the WTO, and anyone else who will listen. Why all the anger directed against what most people in the United States view as a purely domestic policy that hopes to reboot a sluggish recovery? Why wouldn’t that be welcomed by US trading partners in Latin America and everywhere?

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  • Does Argentina’s “Nike Effect” Hold Lessons for Europe?

    What happens when a country faces forced austerity, a banking crisis, a risk of sovereign default, and pressure to abandon a currency peg it has sworn to be eternal and unbreakable? Several European countries are in this position today, but there is nothing really new about it. It’s all happened before, most recently in Argentina in the winter of 2001-02. So what became of Argentina? Are there any lessons there for today’s Europe?

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