 So thank you for the previous presentation and now I turn to the last part of the last two parts of the analysis which are based on the within country analysis of these growth employment poverty nexus okay so the the previous evidence what we have just shown is based on 16 observations okay one per country with annualized changes over the whole period and what I'm going to show you is based on variation within country and over time to study the response of these labor market indicators growth the response of poverty and employment and earnings to employment sorry and earnings changes and the changes in the earnings across the whole distribution of earnings and there is a very solid difference that we discuss in the paper between the previous question and these ones so just focusing on one of the examples what we were trying to answer before was across countries where the differences in imported reductions in the whole period link to differences across countries in their economic growth rates and what we want to answer now is whether if a country grows faster what is the effect of this faster growth on poverty or the effect of changes in labor market indicators on poverty and so what we'll do what we find is that as you could suppose but we find that economic growth does reduce poverty but at very different rates in different countries and changes in poverty are direct related in the world for improving direction with percentage changes in in some employment and earning indicators but again they vary significantly between country and so what so what I just said is that we look at these relationships by country over time but in fact what I'm going to present here we leave the discussion country by country to the country papers and the cross country papers what I'm going to show here are some pulled regressions so these are averages for the whole region which are a bit tricky because as I said there is a lot of heterogeneity that is one of our main conclusions there are very different patterns but for exposition here we'll focus on this and here we have highlighted the trending unemployment and the average unemployment rate for the whole region and GDP per capita and so there is obviously these in regression form you you will see a very strong negative correlation between the two mean labor earnings and GDP per capita are also of course strongly positively correlated and poverty and GDP are negatively and strongly correlated so these are the main trends that would look at but we also had some what we call spaghetti graphs with with the trajectory of each of these indicators for each country in gray lines and this is really very very diverse okay so these are very nice averages that hide a bit of the heterogeneity in patterns for the whole for countries in the region so this is these are the GDP elasticities for some selected indicators again for full data for all country years and and with country fixed effects we find a strong negative elasticity of unemployment with respect to GDP of about minus two and broadly speaking we find a positive correlation between GDP and the some of the indicators of job mix job quality of and quality of employment okay earnings increase more than proportion then proportionally with respect to GDP okay so so we find this effect and we'll see how this impacts into the poverty rates and poverty is of course strongly correlated with changes in GDP with a higher and this is remarkable a higher elasticity in absolute terms for extreme poverty than for moderate poverty for the two point five forty line compared to the four dollar a day party line which which means that that growth was really successful in lifting the earnings so at the bottom of the distribution a bit less as as we move further away to the right of the distribution and we're going to show you some evidence in disrespect in two minutes we also find some some surprising lacks of association some no correlations for instance we found no correlation between changes in GDP and changes in highway and low earnings occupations high and low earning sectors okay we were surprised about that and this is certainly something that is worth looking more in-depth in specific case studies that I know are being conducted by people in the audience so this is something we'd like to know about definitely and as I said a lot of heterogeneity hiding behind these these averages and these lots of heterogeneities and also lots of differences not only in the magnitude but also in the patterns okay so even if the averages are significant and look nice these are two examples Bolivia and Brazil there's a very clear positive correlation between changes in mean labor earnings and changes in GDP and for Brazil at the bottom right we have a very nice negative correlation between changes in GDP and changes in poverty but that relationship is definitely not there I would give these as an example of no correlation in a in an introductory statistics class right with Bolivia okay that is one of the stars in in our in our case studies so this is just an illustration of this heterogeneity regarding the poverty and extreme poverty elasticities with respect to selected indicators again the unemployment elasticity is strong and significant and it is higher for extreme poverty this is not something we're necessarily expecting and but it's an interesting finding and the earnings elasticity is greater than one for extreme poverty and about one for moderate poverty and these elasticities are lower than the poverty growth elasticities I'm not sure it's completely kosher to to compare them like this but somehow the changes in labor earnings seem attenuated compared to those of GDP in their effect on poverty and some of the indicators of quality of employment are also correlated but not for instance the share of workers registered with social security which seems to suggest that formality is something that is happening more in the middle rather than at the bottom changes in formality that as I've been illustrated earlier were important they seem to be happening not at the bottom but at the middle of the distribution I think this is something that that ought to be studied in more depth too and again caveat enter heterogeneity in these elasticities between countries what about the changes in the labor earnings across the earnings distribution so I had just had lunch with Michael Grimm so I should say we're showing anonymous growth incidence curves and Gary has written extensively about this what we find in these incidence curves is that I'm sorry the the main finding that we reported earlier was that mean labor earnings increased in 11 of the countries we study they still fell in five of these countries okay so this does heterogeneity in the region but for the 11 countries in which they increase we have positive changes along all the distribution okay and that is great and for the remaining two we have positive changes for all but the top decide okay so we divide we basically have 16 countries and and 10 desal so we have 160 desiles in 70 percent of these desiles if we group people in the region like this experience increases in labor earnings and 30% of these desiles so no growth and these are almost all based in the five country from the five countries where mean earnings actually fell okay and in more than half of the countries the changes in percentage terms were larger larger for the poor desal and others it was in the middle desal so these were definitely progressive changes okay so so that's why we see these reductions in poverty and reductions in inequality over the period now and I won't show this here but it's discussed in the paper and it's a bit this is a bit of the so the previous was kind of the good news this bit is a bit depressing if we do these growth incidence curves not in relative terms okay nine percentage terms but in dollar terms in 10 countries the larger absolute changes were in the ninth and tenths and this and the earnings were mostly unchanged in dollars for the poorest decide in most of the countries so this seems contradictory but it's just the fact that the base rate is so low that small changes in dollars represent very large proportional changes okay so this evidence should be should be taken into account when I show you these very nice graphs of proportional changes so Bolivia is one of the countries that saw an increase in all these sides except for the top desal as measured by before Nora looks at me as measured in household surveys so you probably have more to say about that and and so these are clearly progressive changes okay up to the median we have positive changes and we have I'm sorry not we have positive changes all over we have changes above the mean for those below the median and below the mean for those below the median and the same is true in Brazil and in Chile with lower level of growth so Chile here looks like more modest but this is like 10% okay so it's it's it's still a lot Bolivian and an outlier in Brazil is a very good success story Colombia the case of Colombia is we included it here because it's a bit more strange we have relative declines with respect to the mean average change for the bottom and the top diesel and and an increase mostly for these middle classes what however we define them Costa Rica also positive growth for all these signs but regressive rather than progressive with with the top quintile experience in above average changes in income and the Dominican Republic with falling falling incomes for everyone for all the designs but somehow progressive because the top this I had experienced a larger drop as measured by household surveys so the summary of the findings for this part of the analysis the response of these within country analysis looking at the year by year changes we find that some labor market indicators and all poverty indicators improved when GDP increased in each country with heterogeneity between these countries there are also correlations between poverty and and changes in the welfare improving direction for some labor market indicators most notably unemployment and the share of salaried employees and also with earnings with high the Georgianity again and in terms of the changes in earnings across the earnings distribution there were positive changes for most groups of the population and higher proportional changes at least for at the bottom of the distribution implying progressive changes in earnings now looking at the extremes of the of our period under study is very nice but we have this bleep in between the the great recession we had these discussions about how to call this international crisis great recession whatever you want to call it in in 2008 and so we definitely wanted to see and and discussions with Finn and and people wider we we we wanted to concentrate to see a little bit what happened during this period in the region with respect to growth and labor market indicators and so average GDP was stagnant in 2000-2003 but then it increased in every year except for 2008 this crisis was milder in Latin America than in high-income OECD countries with reductions in GDP of 1.5 compared to 4% okay but still unemployment increased at the beginning of the period with with stagnant GDP but it fell every year with growth except for the crisis in 2008 and we have several of these indicators of this labor market indicators that deteriorated in from 2008 to 2009 but notably poverty increasing only five of the countries in our sample and it continues falling in 8 out of the 16 countries in our sample and extreme poverty only increase in one country okay so something different was happening here with respect to other crisis we have specialists in on crisis in Latin America here and you this is definitely something different okay the recovery was also quicker in Latin America with respect to countries of the OECD high-income OECD countries and so to in a nutshell what we see is an initial worsening in labor market indicators but a relatively quick recovery of these indicators that even surpassed the pre-crisis level at the end of the period we studied which is 2012 2013 depending on on the country so this is this is the increase in unemployment we observe in average terms and this is the slight fall in average GDP but this is this looks big but it's nothing really dramatic happen and what we do in the paper we discuss this of course in much more detail but the blue lines here are the proportion of labor market indicators either not affected that had total recoveries or partial recoveries by the end of the period we study with respect to 2008 and so only the little beige bars here represent indicators that continued worsening and we can see that in most of the countries most of the indicators did not do worse over or this period what happened next the problem with this multi-year project is that time still goes on we would love it to freeze like an I don't know a guinea pig brain or something like that but economies go on and stuff keeps happening and you need to refrain from the temptation of adding one more year and then never finishing your papers we are not always successful regarding that temptation but these are some projections for the last part of the period something still seems to have happened okay inequality is increasing and we have here projections for 2014 slightly but still increasing since 2012 for the first time in in 10 years and poverty while still falling on average for the region is falling clearly for the last two years at a much slower rate so this is one of the questions one of our so basically we take the big countries and we extrapolate for some of the the big countries and the ones that have data available for 2014 and we fill in as best we can pulling no this is the average 16 countries one country one vote this is UN presentation so final remarks I will not go through the summary of findings that that Gary presented at the beginning because we just mentioned them also in in detail but I just want to focus on the last one real GDP per capita grew in all Latin American countries over the period most labor marketing carries improved in all but one and 40 rates fell in all countries but one okay so this is really remarkable and so we have people in the audience there's the cornea volume on inequality and Luis Felipe's and not a volume also on inequality some of the bits and pieces of this story we knew but what we wanted to focus on was on the addition the relationship with changes in labor markets and and these pieces of the story and we hope that this is informative and adds to what has been done now the conclusion is basically that we have new questions okay so is this time different for Latin America and we shouldn't buy statements about this time is different to we shouldn't take them too seriously because it's never clear but in the long run one would be tempted to say well there's been some kind of structural change we have a new pattern of more inclusive growth mediated as we've shown by by labor markets but perhaps this is transient okay so this is I think the fundamental question how much of this will be permanent and how much not and and a related question is in the short run whether the resilience to the crisis that we observe both in terms of the macroeconomic indicators and labor market indicators is a new aspect of the region we we surpassed stop-and-go and and we will grow happily and be resilient to crisis or was this a different crisis definitely it didn't affect the region as it did before and so what we need to know what we need more research on is on the micro macro channels linking macroegregates to labor markets and and income distribution so Augusto de la Torre was mentioning aggregate demand as one of then expenditures one of the main factors certainly the conclusion from other work showed that trade exports terms of trade and and the eruption of China and Asia as trading partners for the region were very important but we need to know and this is certainly something that has to be done at a country basis we need to know more on these linkages there is some work on differential demand by skill levels definitely and we we only mentioned this briefly but this played a huge role over the whole period but also attenuating the effects of the Great Recession there was a role for the expanded social protection and labor market policies and certainly a more labor-friendly environment in countries in the region the problem is there's this paper I always use by Nora and McLeod on you have the higher terms of trade increases in the herd terminology I'm not saying anything populist country in the more populist countries so is it the terms of trade is populism is it the say it are they jointly determined I think there is a lot to be written about the political economy of these processes within each country but at the end of the day what we want to know is which policies can foster the channels that allowed growth to be transmitted into lower poverty better labor market indicators to facilitate work-based inclusive growth in the region and also as lessons to other regions and in that sense so Francois didn't make it today we hope he will make it tomorrow but we use in conversations with Finn Tarpe the the bourguignon triangle that Gary mentioned in the beginning appeared and in his famous 2003 papers he says well do these results imply that growth has no significant impact on distribution not at all they mean that there is too much specificity in each country and case studies country case studies showed that distributional changes in a given country have much to do with the pace and structural features of economic growth in the period on their analysis and we would like to add mediated through labor markets we would like to add to this triangle so it would be a square we don't know what it will be we would add I'd like to add the role of labor markets here so quitos everyone and Carla has some comments for us