Latin American Economic Outlook 2018

Rethinking Institutions for Development

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The Latin American Economic Outlook 2018: Rethinking Institutions for Development focuses on how institutions can underpin the foundations of a long period of sustained and inclusive growth and increased well-being. The report begins with an overview of the main macroeconomic challenges, analysing the complex macroeconomic context in the Latin American and Caribbean (LAC) region, and exploring policy options to boost potential growth, with a particular focus on trade. It then analyses the link between low trust and society’s disconnection and dissatisfaction with institutions and a number of long-standing, structural features of the region as well as more recent, contextual dynamics that are shaping LAC’s economy, society and politics . In this respect, the report examines how the social contract can be strengthened in LAC, mainly through a state that delivers and responds to citizens’ changing demands, as well as through policies and institutions which provide good and equal socio-economic opportunities in a rapidly changing global context.

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Executive summary

OECD Development Centre

Citizens in Latin America and the Caribbean (LAC) are increasingly dissatisfied with their governments and public institutions at large. The growing disconnect between society and public institutions has emerged as a common feature across LAC in recent years. Citizens’ trust in institutions, traditionally low in LAC, has deteriorated further. The share of the population having little or no trust at all in governments reached 75% in 2017, 20 percentage points (p.p.) higher than in 2010. Satisfaction with public services has also deteriorated. Over 2006-16, the share of the population satisfied with the quality of healthcare services fell from 57% to 41%, well below levels in the OECD (stable at around 70%). Likewise, satisfaction with the education system fell from 63% to 56% over the same period.

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