Una aplicación de un modelo de sinergias duales a América Latina: ¿puede una nueva política industrial romper la trampa del ingreso medio?*

This paper outlines a dual synergies theoretical model. It proposes that a synergy exists between income-poverty-reduction, enhancement of functionings, and economic growth, which does not prioritize increasing the growth rate over the other two variables in the policy objectives hierarchy. Instead, it calls for the integration of social and economic policy. This analytical model is then applied to the Latin American economies through a series of stylized facts about their poverty and human capital stock. This application shows how the Latin American extractive pattern of economic development hasn’t caused rapid economic growth, income poverty reduction, or building human capital. Then the paper draws some policy implications for all developing economies and examines the conceptual and empirical reasons for an active industrial policy (ip). Based on the preceding analysis, the paper discusses the potential for new ip in Latin American economies—that could enable them to break through their middle-income trap. The paper critiques the contents of the old ip and makes the case for a new one, already incipient in Latin America and the Caribbean, that would complement the region’s latest shift in social policy.