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Partial identification for growth regimes: The case of Latin American countries

Abstract:

This study introduces the partial identification of the structural vector autoregressive model to estimate the effect of income distribution on output. For this purpose, this study follows the Post-Keynesian growth models and identifies the demand regimes in Latin American countries for the period 1960–2014. The main results reveal that Bolivia, Colombia, Honduras, and Panama have profit-led regimes. In addition, Costa Rica, Nicaragua, Peru, and Uruguay have wage-led regimes. The regimes of Brazil, Chile, Ecuador, and Mexico could not be determined.