Revisiting the economic growth on Latin American and Caribbean Countries: The role of trade and democracy

Latin American and Caribbean countries have had a singular path of growth throughout their history. This paper aimed to analyze the economic growth in Latin America and the Caribbean (LAC) countries, setting the focus on the politics and trade outcomes. Working with a dynamic panel of biannual growth from 1981 to 2018 for nineteen countries, we apply the System Generalized Method of Moments (SYS-GMM), allowing to some covariates to be endogenous to the growth process. We do not observe income convergence in LAC countries, as well as any effect of being a democracy on growth. We found a positive and significant effect of trade measures on growth. We perform a series of alternative specifications and our main results do not change.