As discussed in detail in the literature on the interaction between short-term shocks and long-term growth, temporary fluctuations tend to alter the growth trend through hysteresis effects. In this regard, recent analyses indicate that although the economies of Latin America and the Caribbean have succeeded, on average, in reducing nominal instability, indicators of real volatility for the region remain well above those of developed economies (Pineda-Salazar and Carcamo-Dfaz, 2013, Cespedes and Poblete, 2011, Haussman and Gavin, 1996). Figure 1.10 shows that investment behaved procyclically during much of the period under analysis: declines in growth were associated with smaller investment contributions, which even became negative. Moreover, a recent study concluded that during the period 1980-2010, growth fluctuations caused changes in investment (see Jimenez and Manuelito, 2013).