Latin American income distribution is among the most unequal in the world. Both the poor and the wealthy have paid a price for this inequality, which is in part responsible for the region’s low growth rates. The essays in this book propose new ways of reducing inequality, not by growth-inhibiting transfers and regulations, but by enhancing efficiency—eliminating consumption subsidies for the wealthy, increasing the productivity of the poor, and shifting to a more labor and skill-demanding growth path. In Beyond Tradeoffs, Latin American experts demonstrate how market-friendly measures in key policy areas can simultaneously promote greater equity and greater efficiency. By identifying win-win strategies, the authors challenge the conventional wisdom that there is always a tradeoff between these two objectives. Extensive macroeconomic reforms in the region have provided opportunities to implement such strategies across many sectors.
The volume aims at building a “Latin consensus” on a second round of reforms—reforms that address the urgent issue of inequality without undermining efficient growth. Contributors include Jonathan Coles, Rene Cortazar, Ricardo Hausmann, Juan Luis Londoño, Nora Lustig, Moises Naím, and Joseph Stiglitz.
Copublished with the Inter-American Development Bank
Nancy Birdsall is the founding president of the Center for Global Development. Prior to launching the center, Birdsall was senior associate and director of the Economic Reform Project at the Carnegie Endowment for International Peace. From 1993 to 1998, Birdsall was executive vice president of the Inter-American Development Bank. Carol Graham is a senior fellow in both Foreign Policy Studies and Global Economy and Development at the Brookings Institution, where she holds the Charles Robinson Chair in Foreign Policy. Her most recent book is Happiness around the World: The Paradox of Happy Peasants and Miserable Millionaires (Oxford University Press, 2010). Richard H. Sabot is the John J. Gibson Professor of Economics at Williams College in Massachusetts.