Typical Latin American Country Has Low Productivity

An article published on Newsweek says that the low productivity of Latin American countries is to blame for the region’s low per capita income and lack of development. The Inter-American Development bank (IDB) appears to have sponsored the study.

Photo Credit: thejourney1972 (away until april)

That article, is a complete load of manure. Let me tell you why.

The study period is from 1960 to sometime in the past, but we’re not told the exact end of the study period. Apparently, it’s not important for us know.


  1. It makes reference to a “typical” Latin American nation, when there is no such thing. How did they determine what makes a country “typical?” Is Brazil typical? How about Costa Rica, Chile or Mexico, are they typical?
  2. The IDB studied 76 nations, including 17 from Latin America and the Caribbean. So, when they say “typical” in the article, do they also mean Caribbean countries as well? What region of the world were the remaining countries in?
  3. The IDB says that since 1960, only Chile has had productivity growth rates that are higher than the U.S. Apparently, Chile’s gains are still lower than India, Thailand and China but the article saves us from telling us what other nations Chile beat out. We’re also not told whether India, Thailand and China were a part of the 76 nation study group.
  4. The article seems to reinforce the stereotype that Latin people are lazy, since the “productivity is so low.”
  5. They never address why Latin American countries would want to “catch up quickly” with other regions of the world? What are the benefits to Latin American countries for doing so? What “other regions” should they catch up to?

I wish Newsweek had taken the time to actually write something that was informative, rather than something that was just filler. Had they actually taken the time to at least tell us the study period, I think it would’ve been a much better article.

They could’ve also bothered to tell us how they measured productivity, what the actual numbers are, what does “low” mean exactly. Actually, they could’ve just given us the numbers, period.

I disagree with Santiago Levy’s, the vice president of sectors and knowledge at the IDB, assertion that there’s an “opportunity for policymakers in the region to invest in reforms and sensible policies.” For one, how does he define “sensible?” and who are these “policymakers?” I guess the governments in the region just haven’t noticed that they need to create policies that encourage economic development, is that it?

Yes, I realize that the theory goes that higher productivity means higher per capita income, more leisure time, etc. I posit that the governments of the region have historically had little interest or need to increase productivity thanks to an abundance of cheap labor, the availability of valuable natural resources and a desire to keep the populace occupied at the state teet.

What do you think? Am I completely off my rocker?

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