Concentration and growth in Latin American countries

Despite urbanization and recent development, many Latin American countries, such as Chile, Peru, Uruguay and Argentina, still maintain very high levels of urban primacy (United Nations 2012). Most studies about the region have analyzed economic and social problems derived from the existence of urban giants but have not considered in which ways urban primacy is currently affecting national growth. In this respect, Brülhart and Sbergami (2009) show, using a sample of 105 countries and controlling for 18 variables used in various convergence studies worldwide, that when a country achieves a GDP per capita level of $10,000 an increase in the level of urban concentration, negatively affects the national growth rate. Consequently, it is plausible that in some Latin American countries spatial concentration not only has become an equity problem but also a constraint for national efficiency whose reduction should be taken into account in development strategies.