STUDIES OF THE AMERICAS INNOVATION AND INCLUSION IN LATIN AMERICA Strategies to ...

245 Pages·2016·3.43 MB·English

STUDIES OF THE AMERICAS
INNOVATION AND
INCLUSION IN
LATIN AMERICA
Strategies to Avoid the
Middle Income Trap
Edited by Alejandro Foxley
and Barbara Stallings
Studies of the Americas
Titles in the Studies of the Americas Series include cross-d isciplinary and
comparative research on the United States, Latin America, the Caribbean,
and Canada, particularly in the areas of Politics, Economics, History,
Anthropology, Sociology, Development, Gender, Social Policy and the
Environment. The series publishes edited collections, which allow explo-
ration of a topic from several different disciplinary angles by eminent
scholars; book-length studies providing a deeper focus on a single topic;
and readers on specifi c themes.
More information about this series at
http://www.springer.com/series/14462
Alejandro F oxley • B arbara Stallings
Editors
Innovation and
Inclusion in Latin
America
Strategies to Avoid the Middle-Income Trap
Editors
Alejandro Foxley Barbara Stallings
CIEPLAN Watson Institute of International &
Santiago, Chile Public Affairs
Brown University
Providence, Rhode Island, USA
Studies of the Americas
ISBN 978-1-137-59681-9 ISBN 978-1-137-59682-6 (eBook)
DOI 10.1057/978-1-137-59682-6
Library of Congress Control Number: 2016940307
© The Editor(s) (if applicable) and The Author(s) 2 016
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A
CKNOWLEDGMENTS
This book is the principal product of a collaborative project undertaken
during 2013–2014 by American University’s Center for Latin American
and Latino Studies (CLALS) in collaboration with the Corporation for
Latin American Studies (Corporación de Estudios para Latinoamérica,
CIEPLAN), with funding provided by the Offi ce of Strategic Planning
and Development Effectiveness of the Inter-American Development Bank
(IDB). The collaboration between CLALS and CIEPLAN has been intel-
lectually fruitful and has resulted in a volume that we believe will be use-
ful to a diverse array of stakeholders, in both academic and practitioner
circles, who seek to better understand opportunities and challenges for
the development agenda in Latin America and the Caribbean as the region
endeavors to move beyond middle-income status and join the ranks of
advanced economies. A Spanish-language version of this volume, titled
Economías latinoamericanas: Cómo avanzar más allá del ingreso medio ,
was published by CIEPLAN in December 2014, though substantial revi-
sions have been made in this current version.
Project research was directed jointly by Barbara Stallings, a CLALS-
affi liated researcher on the faculty at Brown University, and Alejandro
Foxley, the president of CIEPLAN. Stallings and Foxley, with support
from staff at both American University (AU) and CIEPLAN, recruited a
number of leading researchers to carry out studies on particular themes.
Some of those experts were based at AU, others at CIEPLAN, and we
supplemented that core team with economists and sociologists drawn
from additional institutions from throughout the Americas and Asia. We
worked with contributors intensively over the course of the yearlong ini-
v
vi ACKNOWLEDGMENTS
tiative to hone their draft papers so as to better integrate them with one
another and constitute a synthetic rather than disparate collection of essays
on Latin America’s emerging economic challenges and the lessons to be
derived through comparisons both within and beyond the region.
An initial step was to draw on preliminary results of the research that
we commissioned in 2013, as well as an extensive review of available lit-
erature and an iterative process of consultations with experts and policy
makers, to prepare an overview paper presenting critical challenges for
Latin American development and potential approaches to addressing them
during the coming years. Alejandro Foxley took the lead in elaborating
successive drafts of that study, which were presented in numerous IDB-
convened events, particularly a series of consultations convened by IDB
President Luis Alberto Moreno, who has been an unwavering supporter of
our efforts. The fi nal version of Foxley’s study is presented as the second
chapter of this book.
AU and CIEPLAN researchers coordinated our efforts closely, but
there was a clear division of labor: CIEPLAN focused its efforts largely
on South America, while AU addressed dynamics in Mexico and the rel-
evance of East Asian experiences for strategies aimed at combining growth
and inclusion in Latin America. Initial drafts of papers were discussed at
CIEPLAN in Santiago, Chile in January 2014, and advanced drafts were
reviewed in a workshop that we held at AU in Washington, DC in late
May 2014. During our participation in IDB-sponsored meetings, we tried
to hone in as much as possible on the policy implications of our inquiries,
and we hope that this is evident in the book. Toward this end, feedback
from readers drawn from the ranks of senior staff at the IDB assisted us
in making decisions about fi nal revisions to the papers. Conversations
with our interlocutors at the IDB as well as our own interactions over the
course of the project have also helped us to identify directions for future
collaborations between AU and CIEPLAN, plans for which are advancing
productively. We hope that these may also offer opportunities to partner
with researchers in East Asia who have delved into the factors that enabled
countries in the region to traverse paths that many Latin American coun-
tries aspire to emulate, adjusting to the particular historical, political, and
economic societal characteristics of their societies.
A core mission of both the Center at AU and CIEPLAN is to conduct
state of the art research on economic growth and distribution and to dis-
seminate the fi ndings of such investigations as widely as possible. We are
especially grateful to President Moreno and to the IDB staff who have
ACKNOWLEDGMENTS vii
facilitated our efforts to do so through this specifi c project, and special
thanks is due to Veronica Zavala and Maria Camila Uribe, who have been
particularly crucial supporters of our work. While they are not responsible
for any oversights or omissions in this study, we are cognizant of the role
that they and their colleagues have played in helping us to cover a broad
range of critical issues. We also express our gratitude to Sara Doskow,
Chris Robinson, and their colleagues at Palgrave Macmillan, who have
played a key role in helping us disseminate our research fi ndings and have
provided effi cient and timely assistance throughout the manuscript prepa-
ration process.
We believe, based on the reception of our work during a number of
IDB-sponsored events, that the products of our effort provided a valu-
able external input into the strategic planning exercise that the IDB was
undertaking during 2013–2014 and that are expected to shape its agenda
during the coming years. It has been a privilege for both CLALS and
CIEPLAN to have contributed to such an important process. We look
forward to future opportunities to pursue common research agendas in
order to shed light on the pressing analytic and policy issues that confront
observers determined to impact understanding of how Latin American
economies can learn from success cases across the region, as well as from
valuable experiences that have unfolded in other parts of the world. As we
await those opportunities, our hope is that this book will provide a mod-
est contribution to debates about where the region fi nds itself in 2016
and how it needs to innovate in order to move forward. We hope as well
that our contribution will advance scholarly inquiries into the factors that
will determine whether Latin America proceeds along a path conducive to
escaping the middle-income trap, which condemns societies to insuffi cient
growth and inadequate social inclusion, toward a future that combines
prosperity with enhanced welfare for the majority of the inhabitants of the
region.

C
ONTENTS
1 Innovation, Inclusion, and Institutions: East Asian
Lessons for Latin America? 1
Barbara Stallings
2 Inclusive Development: Escaping the Middle-Income Trap 33
Alejandro Foxley
3 Industrial Upgrading and Innovation Capability
for Inclusive Growth: Lessons from East Asia 5 9
Keun Lee
4 Perspectives on Latin American Technological Innovation 9 1
Patricio Meller and Joaquín Gana
5 Policies and Institutions for Driving Innovation in Latin
America 117
Gonzalo Rivas
6 Productivity, Education, and the Economic Inclusion
of Workers and Small Firms in East Asian Development 1 43
Frederic C. Deyo
ix