Economic Problems of Latin America

By Seymour E. Harris | Go to book overview

Chapter I Some Major Issues

by SEYMOUR E. HARRIS

THIS introduction deals with a few problems not treated in the body of the volume, but mainly it emphasizes a few major aspects of Latin American economics. There are two broad economic issues common in varying degree to all Latin American countries. They are (1) international equilibrium--a matter of transcendent importance to Latin American countries--and (2) inflation and savings. These two problems are of course related, and they touch other economic matters of significance: fiscal policy, monetary policy, and the standard of living of the masses. The problems discussed in this chapter generally relate closely to these subjects. It is hoped that this chapter will serve to integrate the material in this volume.

Almost every chapter in this volume brings out the facts that our neighbors to the south are the victims of international forces, and that inflation looms large in each country. The reader will ask whether these countries can isolate themselves from these external influences or whether they can control them; whether inflation has been a force for good or evil and whether or nor its rate has been the appropriate one. Let us try to answer these questions.


I. THE STANDARD OF LIVING

The 20 Latin American republics have a population of less than 130 millions and include approximately 78/10 million square miles as compared with a population of 136 millions in the United States and 3 million square miles. In other words, whereas the populations are roughly equal, the area of Latin America is roughly 2½ times as great. In Brazil the population is one-third that of the United States

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