Growth of Latin America vs.

¶ … growth of Latin America vs. East Asia (China)

Many researchers have quickly gravitated to the significant differences in per capita incomes between the Latin American and East Asian regions of the world to explain their major economic growth differences and trajectory of economic gains seen today. In fact the most conclusive set of findings comes from a series of regression analysis and econometric analysis completed by De Gregorio (2004) (pgs. 111-113) which shows that while income can explain the significant differences in the history and foreseeable future of economic growth of Latin America vs. East Asia, the far more telling factors are the fact that East Asian nations are much freer to engage in global commerce than their Latin American counterparts. Porter (1990) (et.al.) uses the determinants of competitive advantage to organize these specific attributes of an economy.

This is rooted in the ideological stance of Latin America and their at times extremely ethnocentric attitudes about political philosophies. This is having a major effect on Latin America's ability to successfully manage balance-of-payments and attract foreign direct investment, two areas where East Asia was fortunate enough to set a foundation in the early 1990s. Additional factors that have contributed to the gulf in economic performance between East Asia and Latin America is the former's high fertility rates, the low quality of human resources (mainly in terms of schooling, much higher than average levels of government consumption, and low indices indicating local political stability as measured by the rule of law being present in specific regions De Gregorio (1992) (pgs. 59-84). A lack of rule of law equates to lawlessness and high levels of violence and theft.