Eduardo A. Cavallo
Research Page


 Curriculum Vitae                                             Professional Profile 

Published Papers
Economics of Natural Disasters
The Welfare Gains from Macro-Insurance Against Natural Disasters. Co-authored with Eduardo Borensztein and Olivier Jeanne. Journal of Development Economics, January 2017, Vol. 124, 142-156.   Working Paper: NBER Working Paper No. 21674.

Catastrophic Natural Disasters and Economic Growth. Co-authored with Sebastián Galiani, Ilan Noy and Juan Pantano. The Review of Economics and Statistics,
December 2013, Vol. 95, No. 5, Pages 1549-1561. Previous version IDB Working Paper #183Media coverage: Yahoo Argentina; JBonline (Brasil); Diario Financiero (Chile); Radio Caracol (Colombia); SDP Noticias (Mexico); El Comercio (Peru); Terra (EEUU); La Nacion (Argentina).
Natural Disasters and the Economy — A Survey, Coauthored with Ilan Noy.  International Review of Environmental and Resource Economics: Vol. 5:No 1, pp 63-102, 2011. 
The Aftermath of Natural Disasters: Beyond Destruction. Co-authored with Ilan Noy. CESifo Forum 2/2010, pages 25-35. This is an abbreviated version of "The Economics of Disasters --A Survey." IDB Working paper #124.
Debt Sustainability under Catastrophic Risk: The Case for Government Budget Insurance. Coauthored with Eduardo Borensztein and Patricio Valenzuela. Risk Management and Insurance Review, 2009, Vol. 12, No. 2, pages 273-294. (*) See disclaimer below.
Foreign Aid in the Aftermath of Large Natural Disasters. Co-authored with Ilan Noy and Oscar Becerra. Review of Development Economics, 18(3), 445-460, 2014.

Price and Supply Disruptions during Natural Disasters. Co-authored with Alberto Cavallo and Roberto Rigobon. Review of Income and Wealth, Volume 60, Issue S2, November 2014, Pages: S449–S471. Previous version available through NBER WP 19474.

Where is the Money? Post-Disaster Foreign Aid Flowsw/ Oscar Becerra and Ilan Noy. Environment and Development Economics, volume 20, issue 05, pp.561-586. (web appendix).

The Impact of Natural Disasters on Economic Growth. co-authored with Oscar Becerra and Laura Acevedo. IDB Working Paper No. 1257. In Skidmore, M. ed, Handbook on the Economics of Disasters, Edward Elgar Publishing Cheltenham, UK and Northampton, MA, USA

International Finance / Macro
Does Openness to Trade Make Countries More Vulnerable to External Crises, or Less? Using Gravity to Establish Causality. Coauthored with Jeffrey A. Frankel. Journal of International Money and Finance, Volume 27, Issue 8, December 2008, pages 1430-1452. Previous versions available through the John F. Kennedy School of Government Working Paper Series, RWP04-038 and NBER Working Paper No. w10957. Final full working paper version IDB WP# 618. Non-technical summary: NBER DIGEST.
Openness to Trade and Output Volatility: a Reassessment. Economía (Journal of LACEA), Volume 9, Number 1, Fall 2008, pages 105-152. Previous version available through IDB Research Department Working Paper 604.
Financial Development and TFP Growth: Cross Country and Industry Level Evidence. Coauthored with Francisco Arizala and Arturo Galindo. Applied Financial Economics, Vol 23 (6), pp. 443-448 (2013). Research Department Working Paper #682.  
The Determinants of Corporate Spreads in Emerging Markets: An Option-Adjusted Spreads Analysis. Coauthored with Patricio Valenzuela. International Journal of Finance & Economics, Vol. 15, Issue 1, January 2010, pages 59–74. Previous versions available through IDB Research Department Working Paper 602 and IMF Working Paper 07/228.
Exchange Rate Policy and Liability Dollarization: What Does the Data Reveal About Causality. Coauthored with Pelin Berkmen. Review of International Economics, Volume 18, Issue 5, November 2010. Previous versions available through IMF Working Paper 07/33.
Do Credit Rating Agencies Add Value? Evidence from the Sovereign Rating Business. Co-authored with Andrew Powell and Roberto Rigobon. International Journal of Finance & Economics, 18: 240-265 (2013).  Previous version available through Research Department Working Paper #647.
Public Investment in Developing Countries: A Blessing or a Curse? Coauthored with Christian Daude. Journal of Comparative Economics, Volume 39, Issue 1, March 2011. Previous version available through Research Department Working Paper #648.
The Role of Relative Price Volatility in the Efficiency of Investment Allocation. Co-authored with Alejandro Izquierdo, Arturo Galindo and John Jairo Leon. Journal of International Money and Finance, Volume 33 (2013) 1-18. Previous version available through IDB Working Paper #208.
Coping with Financial Crises: Latin American Answers to European Questions. Co-authored with Eduardo Fernández-Arias. Revue internationale de politique de développement [En ligne], 4.1, 2013. URL:; DOI : 10.4000/poldev.1252  Also available as IDB Policy Brief, No. IDB-PB-176. Inter-American Development Bank.
Is the Euro-zone on the Mend? Latin American Examples to Analyze the Euro Question. Co-authored with Eduardo Fernández-Arias and Andrew Powell. Journal of Banking and Finance. Volume 47, October 2014, Pages 243–257. Previous version available through IDB-WP-525.

A New Taxonomy of Sudden Stops: Which Sudden Stops should countries be most concerned about?, joint with Andrew Powell, Pilar Tavella and Mathieu Pedemonte. Journal of International Money and Finance, Volume 51 (2015) 47-70. Previous version available through IDB-WP-430.

Precautionary Strategies and Household Saving,  joint with Joshua Aizenman and Ilan Noy. Open Economies Review, November 2015, Volume 26, Issue 5, pp 911-939. Previous version available through NBER WP# 21019.

What is the relationship between national saving and investment in Latin America and the Caribbean. w/ Mathieu Pedemonte. Economía (Journal of LACEA), volume 16, issue 2, pp29-53, Spring 2016.

Is Business Saving Really None of Our Business?, joint with Ricardo Bebczuk. Applied Economics, volume 48, issue 24, 2016. Previous version available as IDB-WP-523. 

Can Countries Rely on Foreign Saving for Investment and Economic Development?, co-authored with Barry Eichengreen and Ugo Panizza. Review of World Economics (Weltwirtschaftliches Archiv). May 2018, Volume 154, Issue 2, pp 277–306. Previous version available as IDB-WP-718.

Gone with the Wind: Demographic Transitions and Domestic Saving, co-authored with Gabriel Sánchez and Patricio Valenzuela. Review of Development Economics, November 2018, Volume 22, Issue 4, pp 1744-1764 . Previous version. IDB Working Paper  No. 688.

International capital flow reversals (sudden stops). In Oxford Research Encyclopedia of Economics and Finance. Oxford University Press, May 2019. doi:

Growth-friendly Fiscal Rules?: Safeguarding Public Investment from Budget Cuts through Fiscal Rule Designco-authored with Martín Ardanaz, Alejandro Izquierdo, and Jorge Puig. IDB Working Paper # 1083.  Journal of International Money and Finance, Volume 111, March 2021.

"Sectoral Productivity Growth, COVID-19 Shocks, and Infrastructure," co-authored with Hildegart Ahumada, Fernando Navajas, and Santos Espina-Mairal. IDB Working Paper #1256. Economics of Disasters and Climate Change  (2022). 

Review of "A Monetary and Fiscal History of Latin America 1960 – 2017," by Timothy J. Kehoe and Juan Pablo Nicolini (editors). Journal of Economic Literature. Sep 2022, Vol. 60, No. 3: Pages 1058-1071

Political Economy
The Politics of Financial Development: The Role of Interest Groups and Government Capabilities. Coauthored with Carlos Scartascini and Oscar Becerra. Journal of Banking and Finance, Volume 36, Issue 3, March 2012, pages 626-643.
Are Crises Good for Long Term Growth? The Role of Political Institutions. Coauthored with Alberto Cavallo. Journal of Macroeconomics 32 (3), September 2010, pages 838-857. Previous versions available through Research Department Working Paper #643 
Argentina 2002: when the attempt to set the right prices destroyed property rights. Coauthored with Domingo F. Cavallo. (September 2002). Techniques Financières et Développement N°70, mars 2003.

"From Recovery to Renaissance: Turning Crisis into Opportunity," 2022 Latin American and Caribbean Macroeconomic Report. Eduardo Cavallo, Arturo Galindo, Victoria Nuguer and Andrew Powell, Coordinators. (En español, "De la recuperación a la renovación: transformar la crisis en oportunidad")

"Opportunities for Stronger and Sustainable Postpandemic Growth," 2021 Latin American and Caribbean Macroeconomic Report. Eduardo Cavallo and Andrew Powell, Coordinators. (En español: "Oportunidades para un mayor crecimiento sostenible tras la pandemia"). 

"From Structures to Services: the Path to Better Infrastructure in Latin America and the Caribbean," 2020 Development in the America's (DIA), IDB Flagship Report. Eduardo Cavallo, Andrew Powell and Tomas Serebrisky, Editors. Video of the presentation.

"Building Opportunities for Growth in a Challenging World," 2019 Latin American and Caribbean Macroeconomic Report. Eduardo Cavallo and Andrew Powell, Coordinators. (En español: "Construir oportunidades para crecer en un mundo desafiante")
"A Mandate to Grow," 2018 Latin American and Caribbean Macroeconomic Report. Eduardo Cavallo and Andrew Powell, Coordinators. (En español: "La hora del crecimiento")

"Saving for Development: How Latin America and the Caribbean can Save More and Better," 2016 Development in the America's (DIA), IDB Flagship Report. Eduardo Cavallo and Tomas Serebrisky, Editors. Video of the presentation.

"Dealing with an International Credit Crunch: Policy Responses to Sudden Stops," Eduardo Cavallo and Alejandro Izquierdo, 2009. Washington, DC: Inter-American Development Bank. Book presented at the XVIII Ciclo de Jornadas Económicas del Banco de Guatemela. 15 y 16 de Junio de 2009; and the Danish Institute for International Studies (DIIS) and the Ministry of Foreign Affairs of Denmark conference on: Reforming the Bretton Woods Institutions 16-17 September 2009, Copenhagen, Denmark. Non-technical summary available here.

Chapters & Other Contributions

"Strong External Balance Sheets for Resilient Economies," co-authored with Eduardo Fernández-Arias. In Less Risk for More Growth in Latin America and the Caribbean, Andrew Powell and Oscar Valencia, editors. Chapter 2, pp. 5 - 36. Washington D.C. 2023. 

"Domestic Bond Markets: Successes and Challenges," co-authored with Eduardo Borensztein. In Less Risk for More Growth in Latin America and the Caribbean, Andrew Powell and Oscar Valencia, editors. Chapter 3, pp. 37 - 66. Washington D.C. 2023. 

"Implications of Climate Change and Natural Disasters," co-authored with Bridget Hoffmann. In Inclusion in Times of COVID-19, Victoria Nuguer and Andrew Powell, Coordinators. Chapter 6, pp. 53 - 66. Washington D.C. August, 2020. 

"Salir del Tunel Pandémico con crecimiento y equidad: una estrategia para un nuevo compacto social en América Latina y el Caribe Covid -19," Monografía del BID, Julio de 2020. Alejandro Izquierdo, Philip Keefer, Allen Blackman, Matías Busso, Eduardo Cavallo, Gregory Elacqua, Ana María Ibañez, Julián Messina, Mauricio Moreira, Carlos Scartascini, Norbert Schady, y Tomás Serebrisky. 

"Why Credit Matters for Productivity," co-authored with Arturo Galindo and Alejandro Izquierdo. In The Age of Productivity: Transforming Economies from the Bottom-Up, Carmen Pagés, Editor, Chap. 6, pp. 123-151. Washington, DC: 2010 IDB Report "Development in the Americas". Palgrave, Macmillan.

"External Sustainability Analysis: Methods and Policy Issues," co-authored with Oscar Valencia (Banco de la República, Colombia). IDB-Policy Brief #267. 

Working Papers

NEW "The Risk of International Financial Crisis," with Eduardo Fernández-Arias and Juan Martín Rinaldi. IDB Working Paper #1389. 

"Infrastructure Bonds. The Case of Brazil," co-authored with Eduardo Borensztein and Pablo Pereira Dos Santos. IDB-TN-2454.

"Sudden Stops in Latin America and the Caribbean during COVID-19," co-authored with Juan M. Hernández, María José González Jaramillo and Andrew Powell. IDB-WP-1313. 

"Output Effects if Fiscal Consolidations: Does Spending Composition Matter?," co-authored with Martín Ardanaz, Alejandro Izquierdo, and Jorge Puig. IDB-WP-1302. 

"Preventing Sudden Stops in Net Capital Flows," co-authored with Alejandro Izquierdo and John J. Leon. IDB Working Paper #1132. Previous revised version circulated as "Domestic Antidotes to Sudden Stops,". First version of this paper was published as IDB Working Paper No. 851.

"El efecto de la infraestructura en el desempeño de seis economías de América Latina: Una evaluación con modelos de Equilibrio General Computado," co-autoriado con Juan Pablo Brichetti, Omar Chisari, Leonardo Mastronardi, Tomás Serebrisky y Juan Pablo Vila Martínez. IDB Technical Paper No. IDB-TN-1855

"Making International Financial Integration Work for Low-Saving Countries," co-authored with Eduardo Fernández-Arias and Matías Marzani. Previous version IDB Working Paper No. 823.

"Varieties of Saving and Crises," co-authored with Eduardo Fernández-Arias and Matías Marzani. IDB Technical Note No. 1047.

"The Mystery of Saving in Latin America", co-authored with Oscar Becerra and Ilan Noy. IDB Working Paper No. 615.

"Quid Pro Quo: sudden stops and commitment" Coauthored with Andrés Velasco and Roberto Chang. This is a completely new version of a paper circulated under the same title. The previous paper was presented at the UTDT Summer Camp, Buenos Aires, Argentina, December 2005, the 2006 Annual Meeting of the Latin American Economic Association (LACEA), Mexico City, Mexico (November 2-4, 2006), the IMF's Research Department Seminar (February 2007), and the Meeting on Open Macroeconomics and Development, 2nd Ed. Aix-en-Provence, France (July 2-3, 2007).

"Debt Sustainability Fan Charts: Combining Multivariate Regression Analysis and External Forecasts." Mimeos. Coauthored with Francisco Arizala, Christian Castro and Andrew Powell.  

PhD Dissertation: main chapter
 “Trade, Gravity and Sudden Stop: on how commercial trade can increase the stability of capital flows” IDB-Research Department Working Paper #588. Previous version: Federal Reserve Bank of Atlanta Working Paper 2005-23. Paper presented at the 9th Annual Meeting of the Latin American and Caribbean Economic Association (LACEA), San Jose, Costa Rica, (November 4-6, 2004), at the Macroeconomics Seminar of the Federal Reserve Bank of Atlanta (June 13, 2005), and Economics Department Seminars at: University of San Andres (Argentina), University of California at Santa Cruz, Warwick University (UK), University of San Francisco, Wellesley College, Wesleyan University, Catholic University of America, IDB Research Department.
Op-Eds & Press

"Tackling Informality for Fiscal Health in the Post-Pandemic Period." Ideas que Cuentan (06/22/2022). (en español aqui). 

"De la pandemia, a la inflación y la guerra: Desafíos para los formuladores de políticas públicas en América Latina y el Caribe," (w/ Arturo Galindo, Victoria Nuguer y Andrew Powell). Ideas que Cuentan, 4/19/2022. (in english, here)

"Crecimiento, productividad y maleabilidad," Proyección Económica, una publicación del Consejo Profesional de Ciencias Económicas de la Ciudad Autónoma de Buenos Aires, No. 17. pp. 29-51. Marzo 2022
"Preserving Public Investment During Fiscal Adjustments," (w/ Martín Ardanaz, Alejandro Izquierdo and Jorge Puig). Ideas que Cuentan, 3/9/2022. (en catellano, aquí)
"Estimación del possible impacto económico del terremoto de Haiti de 2021," (c/ Laura Giles-Alvarez y Andrew Powell). Ideas que Cuentan, 9/27/2021. (English version here)
"Crecimiento de la productividad a nivel sectorial y el camino a la recuperación de la Covid-19," (c/ Hildegart Ahumada, Fernando Navajas y Santos Espina Mairal). Ideas que Cuentan, 8/19/2021. (English version here)
Latin America and the Caribbean after COVID-19. (w/ Andrew Powell)., 04/13/2021.
Post-pandemic growth in the horizon. (Op Ed), Business Authority - 03/27/2021.
New Report Details the Economic Risks and the Opportunities for Stronger Postpandemic Growth. (w/ Andrew Powell). Ideas que Cuentan, 3/24/2021. (en castellano, aqui)
Can the Design of Fiscal Rules Help to Protect Productive Public Investment from Budget Cuts? IDB Department Research Insights #27, January 2021. (en castellano aqui).
The False Choice of Renewable Energy(w/ Juan Pablo Brichetti and Tomás Serebrisky). Ideas que Cuentan, 10/29/2020. (en castellano aqui).
Digitizing Infrastructure Services Brings More Inclusive Growth(w/ Juan Pablo Brichetti and Tomás Serebrisky). Ideas que Cuentan, 10/14/2020. (en castellano aqui).
The Importance of Good Regulations: When Investing Well Is Not Enough(w/ Juan Pablo Brichetti and Tomás Serebrisky). Ideas que Cuentan, 10/1/2020. (en castellano aqui)
How We Measure the Productivity and Efficiency Gains of Improving Infrastructure Services. (w/ Juan Pablo Brichetti and Tomás Serebrisky). Ideas que Cuentan, 9/15/2020. (En castellano, aqui)
From Structures to Services: A New Vision for Infrastructure. (w/ Tomás Serebrisky and Andrew Powell). Ideas que Cuentan, 8/6/2020. (En castellano, aqui)

¿Cómo puede América Latina y el Caribe evitar la próxima crisis financiera? (c/ Eric Parrado y Juan Hernández). Ideas que Cuentan, 11/15/2019. (English here)

Infrastructure improvements can't wait (Op Ed), Business Authority - 05/20/2019

Cuando la mejora de la infraestructura no puede esperar. Ideas que Cuentan, 5/17/2019. (English here)

América Latina necesita más inversión y productividad. Estas son las razones. (w./ Andrew Powell). Ideas que Cuentan, 4/19/2018. (English here)

Higher growth needed in Latin America and the Caribbean (w./ Andrew Powell)., 4/19/2018.
Forthcoming IDB Report: A Mandate to Grow (w./ Andrew Powell). Ideas que Cuentan, 3/7/2018. (Spanish here).
What are the antidotes to Sudden Stops? (w./ Alejandro Izquierdo and John Jairo León). Ideas que Cuentan, 2/16/2018 (Spanish here)
How Have Natural Disasters Affected Insurance Offerings? Commentary printed in Financial Services Advisor, a publication of the Inter-American Dialogue. January 25- February 7, 2018.
Big Data and the Pursuit of Better Disaster Relief. Ideas que Cuentan, 9/13/2017 (Spanish, here)
Jubilaciones: la Crisis que se Viene. (c./ Mariano Bosch), Focoeconómico, 6/19/2017.

Cuando las pensiones mal diseñadas amenazan el futuro. (c./ Mariano Bosch), Ideas que Cuentan, 6/2/2017.
(English, here)

Rethinking Taxation to Protect Savings. (with Carola Pessino), Ideas que Cuentan, 3/29/2017.

Un Sistema Tributario que Fomente el Ahorro. (c./ Carola Pessino), FocoEconó, 3/8/2017.

Natural Disaster Insurance: Why Don't More countries Have It?, IDEAS que Cuentan, 2/15/2017. (En Español aqui)

Natural Disasters: How Nations Build Resilience, IDEAS que Cuentan, 1/11/2017. (En Español aqui)
No Place Like Home to Finance Investment, IDEAS que Cuentan, 11/4/2016. (En Español, aquí)

Ahorro e Inversión: el Tango se baila de a dos,
(c./ Tomás Serebrisky) FocoEconó, 8/28/2016.

Foreign savings: No gain, some pain,, 8/8/2016.

Fixing the Saving Problem in Latin America and the Caribbean,, 7/29/16.

El Ahorro como Política de Estado,
CNN Chile, 14 de junio de 2016.

Atención con los Desastres Naturales...,, 1/21/23.  
Interview with Radio Fisherton CNN Rosario, Natural Disasters and Growth (in spanish): Audio
The Economics of Natural Disasters, IDEA Newsletter, volume 22. July 2010.
Interview with CNN en Español: February 27, 2010 Earthquake in Chile: video   
Interview with CNN en Español: January 12, 2010 Earthquake in Haiti: video
Interview with "El Economista", Mexican newspaper (in spanish): "Productividad, amarrada al financiamiento". 07/19/2010.
The Case for Optimism amid the Crisis, RGE Global Monitor, Feb 21, 2009.

Do Ratings Matter? RGE Global Monitor. October 21, 2008.

Public Investment in Developing Countries: Blessing or Curse? RGE Global Economic Monitor, Latam Blog. July 02, 2008.

How to Spend $10 billion in Latin America and the Caribbean. RGE Global Economic Monitor, Latam Blog. November 6, 2007.

Getting Ready for the Next Catastrophe. RGE Global Economic Monitor, Latam Blog. August, 29 2007.

The Cost of Financing. RGE Global Economic Monitor, Latam Blog. August, 7 2007.

A Thought on Private Investment. RGE Global Economic Monitor, Latam Blog. July, 25 2007.

Seguro contra la próxima tormenta. El Financiero de Costa Rica, Lun 26 mar, 2007 - Dom 1 abr, 2007.

Promoting Financial Stability. IDEAS Express, IDB, October 2006.


© 2002-2022 Eduardo A. Cavallo