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Income distribution and income sources in Uruguay

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Abstract

This paper is concerned with changes in the distribution of income sources in Uruguay after the late eighties. An apparent stability in the distribution of total incomes is hiding deep transformations affecting the generation of that income. The distribution across all income earners at the end of the eighties exhibited two well-distinguished poles, each associated with one of the main income sources: pension benefits and wages. This bimodality diminished during the nineties due to the reduction in polarization by income sources. In the same period we find that in the case of labor earnings there was a net transfer of population mass from the middle of the distribution to both extremes, which results in an increasing polarization within this income source. This phenomenon resembles the Anglo-Saxon experience of the shrinking middle class.

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Article provided by Universidad del CEMA in its journal Journal of Applied Economics.

Volume (Year): IX (2006)
Issue (Month): (May)
Pages: 49-69

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Handle: RePEc:cem:jaecon:v:9:y:2006:n:1:p:49-69

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Keywords: income sources; inequality; labor market; pension benefits; polarization;

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References

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  1. D'Ambrosio, Conchita, 2001. "Household Characteristics and the Distribution of Income in Italy: An Application of Social Distance Measures," Review of Income and Wealth, International Association for Research in Income and Wealth, International Association for Research in Income and Wealth, vol. 47(1), pages 43-64, March.
  2. Esteban, J.M. & Ray, D., 1992. "On the Measurement of Polarization," UFAE and IAE Working Papers, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC) 171.92, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
  3. Marisa Bucheli & Máximo Rossi, 1994. "Distribución del ingreso en el Uruguay (1984-1992)," Documentos de Trabajo (working papers), Department of Economics - dECON 1094, Department of Economics - dECON.
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  6. Wolfson, Michael C, 1997. "Divergent Inequalities: Theory and Empirical Results," Review of Income and Wealth, International Association for Research in Income and Wealth, International Association for Research in Income and Wealth, vol. 43(4), pages 401-21, December.
  7. X. Zhang & R. Kanbur, 2001. "What Difference Do Polarisation Measures Make? An Application to China," Journal of Development Studies, Taylor & Francis Journals, Taylor & Francis Journals, vol. 37(3), pages 85-98.
  8. Chakravarty, Satya R & Majumder, Amita, 2001. "Inequality, Polarisation and Welfare: Theory and Applications," Australian Economic Papers, Wiley Blackwell, Wiley Blackwell, vol. 40(1), pages 1-13, March.
  9. Wang, You-Qiang & Tsui, Kai-Yuen, 2000. " Polarization Orderings and New Classes of Polarization Indices," Journal of Public Economic Theory, Association for Public Economic Theory, Association for Public Economic Theory, vol. 2(3), pages 349-63.
  10. Yitzhaki, Shlomo, 1994. "Economic distance and overlapping of distributions," Journal of Econometrics, Elsevier, Elsevier, vol. 61(1), pages 147-159, March.
  11. Daniel Miles & Máximo Rossi, 1999. "Geographic concentration and structure of wages in developing countries: the case of Uruguay," Documentos de Trabajo (working papers), Department of Economics - dECON 1399, Department of Economics - dECON.
  12. Yitzhaki, Shlomo & Lerman, Robert I, 1991. "Income Stratification and Income Inequality," Review of Income and Wealth, International Association for Research in Income and Wealth, International Association for Research in Income and Wealth, vol. 37(3), pages 313-29, September.
  13. Esteban, J. & Gradin, C. & Ray, D., 1999. "Extension of a Measure of Polarization, with an Application to the Income Distribution of Five OECD Countries," Papers, El Instituto de Estudios Economicos de Galicia Pedro Barrie de la Maza 24, El Instituto de Estudios Economicos de Galicia Pedro Barrie de la Maza.
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Cited by:
  1. Michal Brzezinski, 2013. "Income polarization and economic growth," National Bank of Poland Working Papers, National Bank of Poland, Economic Institute 147, National Bank of Poland, Economic Institute.
  2. Yoonseok Lee & Donggyun Shin, 2013. "Measuring Social Unrest Based on Income Distribution," Center for Policy Research Working Papers, Center for Policy Research, Maxwell School, Syracuse University 160, Center for Policy Research, Maxwell School, Syracuse University.

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