I'm listening to Argentine economist Martin Krause at our Buenos Aires Digital Americas conference. He presented some eye-opening numbers from the World Bank. I won't reproduce all of the numbers in this blog, they can be found here. But his point was that Argentina struggles to compete because the country lacks institutional structures needed (and he structured his presentation around an analogy of the Argentine soccer team).
Here's one eye-opening example. The World Bank looked at the cost of the regulatory cost of starting a new business in different countries, based on number of regulatory steps needed and number of days required before launch. In Australia, for example, an entrepreneur must jump through an average of 2 hoops over the course of 2 days and then she's ready to go. In Argentina, by contrast, the entrepreneur must endure an average of 15 procedures over 68 days.
There are similar data collections for hiring policies, contract closing, regulatory transparency (despite how much we bemoan our overly burdensome regulations, the US was ranked 4th best in transparency, good for investment), bankruptcy proceedings, etc. Again, the compiled data is at the World Bank site http://www.doingbusiness.org. What Krause pointed out is that Argentina often is closer to sub-Saharan Africa than the US and other western countries in this data, despite the educated and innovative work force found in Argentina.
This conference room is full of young attorneys. Perhaps they will hear Martin's analysis, and the follow-up analysis by Professor Pablo Iannello on how important IP rights are in encouraging the innovation that could flourish in a market with strong institutions (Ray must have been pleased that he cited Schumpeter), and launch "una revolucion nueva" that would be a bit different from the ones this continent has experienced in the past.