A Violent World: Modern Threats to Economic Stability

A Violent World
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The s showed how it is an illusion to imagine a peaceful world without conflict. In this book, the authors explore how six major constraints are set to fix the trajectory of the gl Technological dominance is shifting the balance of global economic stability. This is the central premise behind the latest book from Lorenzi and Berrebi who view the rise of artificial intelligence, robotics, use of private data, and genetic tran Du kanske gillar.

Spara som favorit. Laddas ned direkt. Skickas inom vardagar. The cases of Bolivia with the election of Evo Morales, the Frente Amplio governments in Uruguay, the center-left coalition in. Chile and the PT in Brazil are some of the most prominent examples. However, stable organizations that substantially represent the underprivileged like labor unions are either weak or due to the historical exclusion of informal workers tend to represent another source of privilege, not of equalization.

The diminishing rate in the reduction of inequality for the s is a bitter reminder that the relevant characteristic of the region is not only the prevalence of inequality, but also its durability. Even though cash-transfer programs may have put a dent in it, their effect is limited by the fact that after their initial success further coverage can only be marginal and increasing the value of the transfers might put too much pressure on public finances, as economists throughout the region have argued Gasparini, This is especially true now since the ability of many Latin American countries to keep rates of economic growth stable has been put into question in the last couple of years.

Furthermore, even though economic inequality is a highly visible aspect of inequality, and one that is constantly measured, it only illustrates indirectly other aspects of inequality. Stark differences in the quality and access to public goods like a healthy environment, comfortable housing, and other aspects that determine our overall quality of life might be even more important that just income inequality.

As it is well known, Latin America is still highly unequal in all these other aspects. The combination of slower economic growth and persistent inequality is a source of anxiety for all political actors in the region. The political effect on the stabilization of inequality cannot be underestimated. People are directly affected by differences in income in terms of lifetime outcomes.

IMF warns of elevated risks to global financial stability

However their perception of fairness and justice are also strongly linked to levels of inequality. Negative perceptions regarding the fairness of society are a source of anxiety for economic elites. They worry that populist politicians might come into office and wreak havoc to economic stability. At the same time, leftist parties and politicians worry that economic elites and international financial institutions will overreact to demands of redistribution by curtailing the ability of the underprivileged to influence policy.

This anxiety filled context may lead to situations such as the current political turmoil in Brazil which should be a cautionary note for the rest of the region. There are two main challenges that Latin America currently faces in regard to violence. The first one is an increase in interpersonal violence throughout the region; and the second one is violence linked to organized crime, especially in areas that are relevant for drug related markets.

The latter type of violence is constantly made visible by the media and it has become a source of mano dura policies with little respect for human rights, whereas it is the former, interpersonal violence that claims more victims every year in countries across the region. There is great variation in national homicide rates within Latin America, and there is even more variation within countries see Figure 2. Some countries like Honduras and El Salvador share the highest levels of homicides around the world, whereas others like Chile and Uruguay are among the lowest.

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Larger countries like Mexico, Brazil, Colombia, and Venezuela have regions where their homicide rates are comparable to those of Scandinavian countries, while at the same time they have locations with levels of violence reminiscent of the American wild-west. A large part of this variation is explained by social and demographic phenomena.

The two characteristics that seem to be driving violence are demographic structures with bulges of young men, and an increasing participation of women in the labor market Rivera, Though these large trends do not allow to pinpoint with precision the motivations behind increasing interpersonal violence, it is not farfetched to make the link between violence, changing family structures, weakened state institutions, and the increasing presence of unsupervised young men.

This absence of supervision or social control, either by traditional social institutions—i. The other important source of variation is not drug production or trafficking per se, but how governments deal with illegal drug markets Lessing, There are some countries that are ranked as large producers of drug-related products, but have little violence linked to them.

On the other hand, there are other countries with small drug markets, or with territories exclusively used as trafficking routes, where there are high levels of violence associated to these activities. Governments sometimes confront, sometimes appease, and sometimes simply turn a blind eye to drug trafficking; each policy option leading to divergent outcomes in terms of violence. Nonetheless, even if structural sources of violence play an important role in explaining insecurity in Latin America, the perception many people have is that the main source of violence and crime is impunity.

Everyday life in most countries in the region goes on with the expectation that the authorities will not be able to intervene when a robbery or homicide is committed, and once it is committed the expectation is that victims will not receive much help. Furthermore, perpetrators will most likely not be punished or if they are punished this punishment will be attenuated by their relative economic or political power. In this respect prospects are grim. Reflecting on the future, the region has to seriously reconsider the basic premises of what produces violence, and what controls it.

It has to rethink both the role of the state and the role of society on what controls the use of violence in everyday life, and what exacerbates it. By any standard measure, the Latin American state is weak and fragile. Perhaps the most obvious indicator is the size of the percentage of the economy accounted for by the state.

Whether measured in terms of revenue or expenditure, the Latin American states are small and broadly ineffective. Paradoxically, Latin American states do perform well in some of the functions associated with strong institutions. The region as a whole outperforms countries with similar wealth in providing some foundation of public health and educations. But in others and notably monopoly over the means of violence as described above Latin American government institutions are widely perceived as inadequate.

Infrastructure is one area where the region underperforms based on its wealth. This creates a permanent obstacle to more sophisticated forms of economic development and also takes a toll on citizens relying on transport and communication services. The delivery of some services such as postal and garbage collection is very bad and has often been absorbed by private sector firms. One indication of the relative weakness of the state is the size of the informal economy.

While some may argue that this serves as an economic dynamism, it also means that the state has a difficult time taxing much of the economic activity and also fails to protect workers. The enforcement of contracts is also a problem, as confidence in the courts remains low. A similar story could be told of the public service in general where with the exception of some islands of excellence such as Central Banks standards are less than Weberian Centeno et al.

Corruption is a major problem and as in the case of Brazil over the past few years, a source not just of economic inefficiency, but a challenger to the legitimacy of government itself. Some of these conditions are the product of the international context and some might be the product of domestic political coalitions. Therefore, the future is far from certain. On the one hand, it could be argued that increased and increasing globalization further diminishes the capacity of states to control fiscal policy, and thus redistribute wealth through services and social policy.

On the other hand, rising globalization may allow for more opportunities for developing countries to turn commodity booms into sources of capitalization for local investment. Furthermore, criminal enterprises have expanded the access to international markets both as sellers as in the case of drug-trafficking and as buyers as in the case of money laundering and arms , while international cooperation may allow for better coordination in the pursuit of transnational criminal organizations.

Many of the challenges facing Latin America in the 21st Century are ones with which it has dealt since independence from Spain years ago. The dependence on fragile trade relationships and primary products, the incessant violence, and inequality practically defined the region in the 19th Century.

The fragility of the environment and the global web are new, but the outstanding challenge remains the same: the institutionalization of social order through the state. While the region may not be able to resolve all the challenges it faces, nothing can be done without the solidification of state capacity. Some states in Latin America might be better than others with regards to their performance in terms of the provision of certain services, or the implementation of particular policies.

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However, the type of solidification in dire need is one the makes both state and society more regular and predictable. Everyday, Latin Americans makes use of their ingenuity in order to deal with the unexpected and irregular sources of violence, poverty, and environmental phenomena.

However, individual ingenuity is costly when mostly directed at basic needs, and uncertainty has only increased with globalization and with the slow pace by which the world has met the challenge of human-made environmental changes. Overall, Latin American states have not been able to make economic activity predictable for most of the population. Policies directed towards social inclusion have become less and less about building institutions that permanently help individuals deal with the uncertainties of the market, and more about providing minimal and intermittent relief to those in a situation of emergency.

Likewise, most states throughout the region have not been able to control interpersonal violence and in some cases the state itself has become a source of increased violence. Paradoxically, this means that in a more uncertain world, instead of states becoming a source of stability and regularity, they have become an added source of uncertainty for everyday life. This paradox might be the greatest challenge Latin America has to face.

Meeting the challenge implies that countries will need stronger states, not only for implementing specific policies, but more importantly for developing new ways to regularly deal with the increasing risks their populations are facing. Centeno, Miguel A. Yashar Eds. States in the Developing World. Centeno, Miguel, M. Nag, TS Patterson, A.