Environmental and development issues in Latin America: moving forward

For the most part, economic research in Latin America has had a ‘macro’ orientation (e.g., economic growth, monetary and fiscal policy, hyperinflation crisis). This is perfectly understandable because of the macro instability that has affected the entire region for decades and that still remains in many places. However, the composition of research is gradually changing as more attention is paid to a wider set of problems. Nowadays we see an increasing number of researchers in the region focusing on a variety of economic problems dealing with health, education, poverty alleviation, competition policy and the protection of natural resources and pollution control, among many others. This special issue of Environment and Development Economics presents a small sample of four research papers on these latter topics by researchers in established academic institutions in the region. The first paper, by Marcelo Caffera from the Universidad de Montevideo, Uruguay, provides a political economic analysis of why market-based instruments for pollution control, such as Pigouvian taxes and tradable pollution quotas, have rarely been used in Latin America. The author can only point to three experiences in the entire region and holds little hope that their use can be extended much further without building more institutional capacity. The second paper, by Juan Camilo Cardenas from Universidad de los Andes, Colombia, Luis Angela Rodriguez from Instituto A. von Humbolt, Colombia, and Nancy Johnson from ILRI, Kenya, reports the results of two field experiments on the collective use of water resources in Colombia and Kenya. In both cases the authors reject the free-riding or no-contribution hypothesis, which is a standard theoretical prediction in