Wages, employment and workers' rights in Latin America, 1970-98

Orthodox neoclassical economic theory predicts that trade liberalization and labour market flexibility will increase employment and foster economic growth, leading also to higher wages. But Latin America's experience over the past three decades shows that this may not happen in practice. In most countries of the region, the gains from economic growth were not passed on to workers, and overall labour market conditions deteriorated. Weeks concludes that only greater protection for trade union rights can redress the imbalance between the bargaining power of labour and of capital and thereby secure a more equitable distribution of the gains from growth.