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Fair Growth: Economic Policies for Latin America's Poor and Middle-Income Majority

1/17/08
Nancy Birdsall, Augusto de la Torre, and Rachel Menezes
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"The 'Washington Consensus' reforms needed to be supplemented by a set of measures explicitly focused on equity. This book offers a vision of what such a reform agenda should look like. Unlike the populist demagoguery that has for too long dominated discussion of this topic in Latin America, the authors' 'equity toolkit' is well-conceived, and deserves to be discussed and implemented."

-John Williamson, Senior Fellow, Peterson Institute for International Economics

"Solid and closely argued policy recommendations make Fair Growth compulsory reading for politicians, intellectuals, experts, businesspeople, and all those among us who believe it is possible to build a region that is more just and more prosperous."

-Michelle Bachelet, President of Chile

Most students of development put more energy into understanding the causes and consequences of absolute poverty than of inequality. But globalization—with new opportunities to win and to lose -- is changing that. Equality is an issue of rising concern, and nowhere is it more worrying than in Latin America, home to many of the world’s most unequal societies. In this book, CGD president Nancy Birdsall and her co-authors, Augusto de la Torre, chief economist for Latin America at the World Bank, and Rachel Menezes, former economic policy associate at the Inter-American Dialogue, describe the links between recent growth trends, changing patterns of inequality, and rising cynicism and frustration with the political leadership across the region.

They present a dozen economic policy tools aimed explicitly at making life fairer for the great majority of the region's people—not only the 25 percent who are "poor" (earning US$2 a day or less), but also the additional 45 percent of working-class and middle-income individuals who make less than US$10 a day. The author's recommendations -- tackling corruption, giving small businesses a chance, repairing rural markets, among others -- aim at ensuring that the benefits of globalization are shared but without sacrificing the economic growth that must underpin long-term improvements in living standards. Success with these fair growth reforms requires political leadership and technical know-how on the part of government officials and legislators, and the support and input of businesses, civil society groups, students and intellectuals.