Spring 2024 Alumni Newsletter

Maria Lorca-Susino and Dr.
Dr.
Acevedo study the
Rafael
between economic
correlation
and freedom in their
growth
paper titled “The shortrun
research
consequences of the erosion
by the Economic
published
for Latin America
Commission
Caribbean countries of the
and
Nations (CEPAL No.140).
United
to the authors, “our
According
experience as it
personal
to the importance of
translates
growth has always
economic
a personal element to this
added
topic, which delves
multifaceted
economic prosperity, quality
into
life, and well-being, with
of
that have divided
conclusions
since the dawn of
researchers
Lorca-Susino is originally from Spain, a nation
Dr
has experienced significant economic growth
that
the advent of democracy in 1975, and
since
after joining the European Union in
particularly
In sharp contrast, Dr Acevedo is originally
1986.
Venezuela, a country that has experienced
from
developed nation during the 20th century,
and
the country has regressed to a developing
today,
where in 2022, 81.5% of households had
nation
below the poverty line according to the
incomes
National Poll of Living Conditions (ENCOVI),
latest
by the Andrés Bello Catholic University in
released
2022. As the authors explain, “in both
November,
economic freedom was a significant
countries,
tied to economic growth.” Because of their
factor
experiences, the historical relationship
personal
Spain and Latin America, and the direct
between
of Venezuela on Latin American countries,
influence
decided to analyze the short-run
“we
of the erosion of economic freedom
consequences
it impacts the economic growth rates and
as
of 19 countries in Latin America in the
institutions
innovative research brings to light a
Our
approach when it comes to identifying
new
short-run consequences, in fact, the
these
gathered suggests that the more
evidence
erosion of economic freedom, the
acute
the loss of economic growth at a
greater
significant level different from
statistically
In fact, for each percentage point
zero.
of economic freedom, we
erosion
economic growth rates between
observed
and 1.6 percentage points lower the
0.3
year.
following
graph above shows the positive
The
between economic growth,
correlation
as the growth rate of
measured
real gross domestic
expenditure-side
(GDP) per capita at chained
product
power parity in 2017 dollars
purchasing
from the Penn World Table, and
taken
freedom, measured by the data
economic
with variables from the Fraser Institute
set
for economic freedom, the
(2021)
Country Risk Guide for
International
by PRS Group, and the V-
corruption
Dataset by Coppendge and
Democracy
(2021) among other sources.
others
The Short-run Consequences of The Erosion of Economic
Freedom for Growth and Institutions in Latin America: An
Unorthodox Experimental Review of The Twenty-first Century
DR. MARIA LORCA-SUSINO
Image preview
what Acemoglu, Johnson, and Robinson call a
of economic freedom for growth
and institutions in Latin America” -
“reversal of fortune,” whereby despite been a rich
7
civilization.”
twenty-first century.”