This study estimates requirements for infrastructure investment in 21 Latin American countries for the period 2011–2040 using a structural equation model. Needs total about 4 percent of GDP. Projections are provided for both a high-growth convergence scenario and a low-growth business-as-usual scenario. These costs represent minimum investments necessary to support expected economic growth. Costs are presented separately and in total for new-capacity investment and maintenance for 10 sectors: airports, electricity, fixed broadband, landlines, mobile telephony, ports, rail, paved roads, sanitation, and water. Country coverage comprises Argentina, Belize, Bolivia, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Guyana, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Suriname, Uruguay, and Venezuela. The model differs from past studies of regionwide long-term infrastructure investment needs in five features: (1) It considers alternate GDP growth scenarios; (2) It employs a structural equation model using instrumental variables to provide unbiased, consistent projections for both GDP growth scenarios (Instrumented variables are urbanization and the shares in GDP of agriculture, manufacturing, and services); (3) Mobile phone investment costs are not constant but instead vary with population density; (4) Two additional, wealthier countries are included in modeling to prevent forecasting outside the range of the independent variables’ values used to construct the model, and; (5) Timing of new-capacity investments is distributed over multiple years and varies by sector.

Asian countries have the ability to dramatically improve their standards of living in coming decades, so much so that by 2050 the “converging” middle-income countries could become affluent societies. Historically, however, many fast-growing countries have stagnated upon reaching middle-income status, a phenomenon known as the “Middle Income Trap.” This article quantifies possible opportunity costs of Asian countries falling into or staying in the Middle Income Trap rather than sustaining or emulating current successes. Opportunity costs are quantified in terms of income and affluence, output and Asia’s share of the world’s economy, infrastructure critical to health (population without access to an improved water source, population without access to improved sanitation, and non-urban road net-work density), and infrastructure related to consumption (port and airport activity). However, there are further obstacles in addition to the Middle Income Trap—five other “mega”-challenges—and if those were not to be overcome the opportunity costs would be worse.

This article presents the construction and analysis of a long-run GDP growth model, including sample results, its sensitivity to parameter choices, and explanations of the concepts underpinning it. It is designed to be flexible so that scholars can use it with their own assumptions and parameter choices to customize results. The model estimates GDP as a function of labor force, capital stock, and total factor productivity (TFP) for 185 countries through 2050 under alternate scenarios. It provides rough estimates for real exchange rates, poverty indices, median and percentile incomes and consumption levels, and the populations of the lower, middle, and upper income classes. The model also provides additional evidence for the TFP convergence phenomenon and the effect of the state failure on TFP growth. It can further be used to model stocks, accessibility, and investment requirements for 10 infrastructure sectors. The model can yield counterfactual estimates and actual and roughly estimated comparable historical data for most of the projected series, provided in identical units. For 126 countries, such series (e.g., TFP) are provided back through 1956, and for some even earlier.

At the Emerging Markets Forum in October 2010, initial results were presented from an exercise that attempted to measure the resilience of emerging market and developing countries (EMDCs) to deal with shocks to their economies. This paper updates, improves upon, and draws conclusions from that index. A key conclusion is that the Resilience Index appears to have the power both to identify economies that are heading to trouble and to identify the specific policy areas of weakness that lie behind their increasing vulnerablility. The Resilience Index can add to the tools of the economic surveillance process-at least as a device to help insure that weaknesses are surfaced, and that deeper analysis is conducted to assess those weaknesses and suggest corrective policies. It is clear from this analysis that building resilience-and making it a priority of policymakers-can pay high dividends. In particular, we show that the Resilience Index clearly demonstrates that emerging weaknesses in many economies were evident well before the global crisis and the crisis in Europe.

Over the next few decades, the United Nations (UN) has projected that the world will experience significant demographic shifts due to lower birth rates and longer lifespans. 1 The world's population aged 65 and above will increase from 12 percent today to 16 percent in 2050, doubling the old-age dependency ratio 2 to 25.2. These demographic shifts would have material implications. Population aging and its dynamics will influence a number of economic variables and behavioral responses, particularly economic growth, productivity, labor force participation, consumption choice, personal savings and thus investment, and public finances. Population aging is unavoidable, but public policies and technological advances may limit some of its adverse effects.