Growth Diagnosis for Mercosur: the Regional Dimension and Competitivity

The research gathered in this book ? carried out by three MercoNet institutions ? focuses on growth, competitivity, and integration in the Mercosur sphere. This research is based on three ideas which are central in modern literature in the field. The first is that exports have a central role in making productivity dynamic; the second is that geography matters in so much as it can help the discovery of new activities to take advantage of growing economies of scale within the region; the third is that growth follows a path, which far from being linear, is a process of structural change that shows breaking points (acceleration and collapse). With this view, it is important to identify the factors that could accelerate the growth or avoid collapse that are typical of the region?s countries when designing policies to improve international productivity and competitivity. In order to identify these factors, growth diagnosis were carried out of the two largest Mercosur economies and of Uruguay, adopting a regional and comparative perspective and emphasizing the process of discovery in new export activities and in the role of foreign direct investment and the national innovation system.
What does the book have to say about ?where we are? and ?what is lacking? in Mercosur? ?With respect to exporter performance, the research detects a lack of capacity to develop the trade sector, weaknesses in the self discovery process and ? as a consequence ? a specialization pattern which is not very dynamic. With respect to geography, low integration and a lack of coordination among macroeconomic and financial policies are evident. Lastly, discontinuities and ruptures in the growth process are related to a low level of innovation, high policy and regime volatility, and an underdeveloped financial system.
This publication is available below (in Spanish)