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Rising Wage Inequality in Mexico, 1984-2000: A Distributional Analysis

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  • Gurleen K. Popli

    (University of Sheffield)

Abstract

In this study we look at distribution of wages to examine the extent and cause of the increasing wage inequality in Mexico over the two decades encompassing 1984 and 2000. To understand the causes of the increase in inequality over time we do a counterfactual analysis. We find that over the last two decades not only did the inequality increase, there also was an erosion of real wages, and it is the middle class which was affected the most. The main reason for the decrease in real wages was declining unionization in the country, while the main reason for the rise in inequality was changing distribution of skills.

Suggested Citation

  • Gurleen K. Popli, 2007. "Rising Wage Inequality in Mexico, 1984-2000: A Distributional Analysis," Journal of Income Distribution, Ad libros publications inc., vol. 16(2), pages 49-67, June.
    • Handle: RePEc:jid:journl:y:2007:v:16:i:2:p:49-67
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    1. David Fairris & Gurleen Popli & Eduardo Zepeda, 2008. "Minimum Wages and the Wage Structure in Mexico," Review of Social Economy, Taylor & Francis Journals, vol. 66(2), pages 181-208.
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    Cited by:

    1. Susan Hayter & Bradley Weinberg, 2011. "Mind the Gap: Collective Bargaining and Wage Inequality," Chapters, in: Susan Hayter (ed.), The Role of Collective Bargaining in the Global Economy, chapter 6, Edward Elgar Publishing.
    2. Richard B. Freeman, 2009. "Labor Regulations, Unions, and Social Protection in Developing Countries: Market distortions or Efficient Institutions?," NBER Working Papers 14789, National Bureau of Economic Research, Inc.
    3. Ibarra, Carlos A. & Ros, Jaime, 2019. "The decline of the labor income share in Mexico, 1990–2015," World Development, Elsevier, vol. 122(C), pages 570-584.
    4. Susan Hayter, 2015. "Unions and collective bargaining," Chapters, in: Janine Berg (ed.), Labour Markets, Institutions and Inequality, chapter 4, pages 95-122, Edward Elgar Publishing.
    5. Freeman, Richard B., 2010. "Labor Regulations, Unions, and Social Protection in Developing Countries," Handbook of Development Economics, in: Dani Rodrik & Mark Rosenzweig (ed.), Handbook of Development Economics, edition 1, volume 5, chapter 0, pages 4657-4702, Elsevier.
    6. Eduardo Michel Camacho & Willy W. Cortez, 2012. "Distribución del ingreso y bienestar social en México 1984-2008," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 27(2), pages 347-378.

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    More about this item

    Keywords

    kernel density estimation; counterfactual distribution ; unions; trade liberalization; changing distribution of skills;
    All these keywords.

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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