This paper explores the link between compulsory voting and income distribution using a cross-section of countries around the world. Our empirical cross-country analysis for 91 countries during the period 1960-2000 shows that compulsory voting, when enforced strictly, improves income...

In this paper, we examine how the business and interest rate cycles in developed countries affect FDI to developing countries. After aggregating flows into three big source areas (the U. S. , Europe and Japan), we find FDI flows to be countercyclical with respect to both output and interest rate...

Much has been written recently about the problems for emerging markets that might result from a mismatch between foreign-currency denominated liabilities and assets (or income flows) denominated in local currency. In particular, several models, developed in the aftermath of financial crises of...

This paper compares growth conditions in China and Latin America to assess fears that China will displace Latin America in the coming decades. China`s strengths include the size of the economy, macroeconomic stability, abundant low-cost labor, the rapid expansion of physical infrastructure, and...

This paper assesses how electoral outcomes in both presidential and legislative elections in Latin America have been affected by the adoption of economic policies that seek to improve macroeconomic stability and facilitate the functioning of markets. The database includes 17 Latin American...

We suggest that foreign banks may represent a trade-off for their developing country hosts. A portfolio model is developed to show that a more diversified international bank may be one of lower, overall risk and less susceptible to funding shocks but may react more to shocks that affect expected...

This paper studies the relationship between creditor protection and credit volatility. During the negative phase of the business cycle, credit contracts more in countries with poor creditor protection. For similar shocks to business conditions, credit is more volatile in countries where...

This paper develops a model showing that inefficient legal protections disproportionately increase financial restrictions for creditors that have less wealth. Due to fixed monitoring costs in equilibrium, banks will not monitor small firms, and therefore these firms will adopt risky technologies...

Financial dollarization in Latin America has been growing over time in spite of a major reduction in inflation and a shift toward central bank independence. After discussing the key stylized facts of dollarization and dedollarization in the region, we discuss the risks this process poses to the...

In spite of deep structural reforms, Central American countries have failed to experience rapid and stable growth in recent years. This paper explores whether and to what extent we can consider lack of innovation and technology adoption as a main reason for this disappointing experience. The...