This paper examines capital adjustment patterns using two large and largely novel data sets from the manufacturing sectors of Colombia and Mexico. The findings show that investment patterns in these countries resemble those reported for the United States to a surprising extent. Capital...

This paper examines capital adjustment patterns using two large and largely novel data sets from the manufacturing sectors of Colombia and Mexico. The findings show that investment patterns in these countries resemble those reported for the United States to a surprising extent. Capital...

Using two largely novel datasets, we examine how Colombian and Mexican plants invest in response to imbalances between actual and "desired" capital stock levels. Nonparametric estimates of the average adjustment function support the presence of irreversibilities, but not of nonconvexities

KEY ISSUES Context. Colombia’s economic performance has been robust, underpinned by a very strong policy framework. Last year, real GDP grew by 4.3 percent, with low inflation. The country has a strong external position; the financial system is sound; and fiscal policy remains guided by a...

This paper discusses Colombia's Arrangement Under the Flexible Credit Line (FCL) and Cancellation of the Current Arrangement. In the baseline scenario, growth in Colombia is expected to decelerate to 3.4 percent in 2015 but gradually return toward potential over the medium term and inflation to...