The journal assignment should summarize the central themes/topics in the reading, outline theoretical frameworks presented, record your impressions of the reading and list 3 questions that each reading raises. Latin America’s prospects are brighter than at any time in the past quarter century. Robust global demand for the region’s agricultural, energy, and mining exports helped its economies expand by more than 5 percent in 2006—the fourth consecutive year of GDP growth. Since 2003 GDP per capita has risen 12 percent, a sharp contrast with the region’s previously moribund economic performance. Encouragingly, most governments in Latin America are responding to today’s auspicious conditions with sound policies. As a result, macroeconomic stability is returning. Inflation—a perennial scourge—fell to a 40-year low. Governments across Latin America have used windfall export revenues to balance their books. Still, the hope of prosperity and opportunity eludes many Latin Americans. The region has the world’s most unequal income distribution. While access to education is improving, educational quality is poor. Moreover, weak institutions and regulatory burdens are partly responsible for a business environment that stifles entrepreneurship and for the persistence of poverty and unemployment. Latin America has seen its booms go bust. While this level of growth might seem modest compared with recent growth in China and India, such figures contrast sharply with Latin America’s past. From 1980 to 2003, the region’s GDP grew by barely 2 percent a year. A combination of booming commodity markets and government reforms supplied the preconditions for macroeconomic stability. Inflation dipped below 5 percent in 2006, the lowest level in four decades. Foreign debt fell from 42 percent of GDP in 1987 to 25 percent in 2004. Likewise, public debt (including nonfinancial public-sector debt), which averaged 73 percent of GDP for Latin American countries in 1993, fell to 43 percent in 2006. Public finances are largely balanced. Not all signs are positive, of course. Brazil’s economy, the region’s largest, expanded by less than 3 percent in 2006. The only country in Latin America or the Caribbean that grew at a slower rate in 2006 was Haiti. Moreover, today’s positive outlook owes much to the high prices commanded by the region’s export. Should growth in demand for those commodities fizzle, Latin America would likely sufferMeasured by income distribution, Latin America has the world’s greatest inequality. The richest 10 percent of Latin Americans earn about 48 percent of total income, while the poorest tenth earn just 1.6 percent. By contrast, the richest 10 percent in the United States receive around 30 percent of total income, and the poorest only 2 percent. Worse, Latin America’s level of income inequality has remained stubbornly persistent. While a handful of countries have seen improvements, the region’s Gini coefficient—a measurement of the equality of income distribution in an economy—has hardly budged since 1990.High levels of income inequality hurt economies by exacerbating social tensions, increasing poverty, and lessening the impact that economic development has on the reduction of poverty levels. And poverty in Latin America remains widespread. Despite a decline of more than four percentage points since 2002, poverty afflicts nearly 40 percent of all Latin Americans—some 209 million people. To reduce it further, governments will have to ensure that more people get access to quality education. Moreover, productivity growth must be accelerated through a combination of more effective public spending and the creation of more favorable conditions for foreign capital investment. Access to education in Latin America has improved dramatically. For example, since 1960 the average number of years a child in Mexico spends in school has increased to nearly 8, from 2.6. A 5-year-old child in Argentina can expect to receive the same number of years of education (15) as would a child in Japan; the average for Latin America is 13 years. However, access varies widely by income. In Mexico City, for instance, where income is relatively high, 72 percent of 13- to 15-year-olds are enrolled in secondary school, versus 52 percent in the poorest state, Chiapas.1 Moreover, the quality of education is poor. When the Organisation for Economic Co-operation and Development (OECD) assessed the abilities of 15-year-olds in math, reading, and science, it found that students in Latin America scored lower than their peers in other regions. Thai students, for example, scored 17 percent higher than Brazilian ones, even though the two countries have comparable levels of GDP per capita. More money would help, but it must be spent in ways that make a difference; Mexico, for instance, performs no better than Argentina, Brazil, or Chile, despite higher spending.