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Forecasting wage inequality

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  • Jaime Ruiz-Tagle

Abstract

Wage inequality in Chile has remained high for decades and it is currently at the center of the political agenda. Increasing education of workers is expected to contribute to reduce wage inequality. Based on historical trends of age, education, and returns to education, this paper attempts to forecast wage inequality. Despite an increase in average earnings due to higher levels of education of workers, high levels of wage inequality within age groups and within education groups produce that forecasted wage inequality remains high for the next 10- year period. The structure of the Chilean labor market appears to imply that there is a high level of underlying wage inequality. Nevertheless, the good news are that the labor market structure seems to prevent further deteriorations of wage inequality.

Suggested Citation

  • Jaime Ruiz-Tagle, 2007. "Forecasting wage inequality," Estudios de Economia, University of Chile, Department of Economics, vol. 34(2 Year 20), pages 141-162, December.
    • Handle: RePEc:udc:esteco:v:34:y:2007:i:2:p:141-162
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    File URL: http://www.econ.uchile.cl/uploads/publicacion/c71266be-d189-4a27-916d-3c2e09bdbc37.pdf
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    References listed on IDEAS

    as
    1. Contreras, Dante & Cooper, Ryan & Neilson, Christopher, 2008. "Crecimiento pro pobre en Chile," El Trimestre Económico, Fondo de Cultura Económica, vol. 0(300), pages 931-944, octubre-d.
    2. N/A, 2001. "The World Economy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 175(1), pages 29-58, January.
    3. Jere R. Behrman, 2011. "How much might human capital policies affect earnings inequalities and poverty?," Estudios de Economia, University of Chile, Department of Economics, vol. 38(1 Year 20), pages 8-41, June.
    4. N/A, 2001. "The World Economy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 176(1), pages 35-60, April.
    5. Rómulo A.Chumacero & Ricardo D.Paredes, 2005. "Characterizing income distribution for poverty and inequality analysis," Estudios de Economia, University of Chile, Department of Economics, vol. 32(1 Year 20), pages 97-117, June.
    6. Claudio Sapelli, 2011. "A cohort analysis of the income distribution in Chile," Estudios de Economia, University of Chile, Department of Economics, vol. 38(1 Year 20), pages 223-242, June.
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    Citations

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    Cited by:

    1. Contreras, Dante & Gallegos, Sebastian & Meneses, Francisco, 2009. "Determinantes del desempeño universitario: ¿Importa la habilidad relativa? [University performance determinants: does relative ability matter?]," MPRA Paper 23320, University Library of Munich, Germany.
    2. Javier Núñez Errázuriz & Andrea Tartakowsky, 2009. "The relationship between Inequality of Outcomes and Inequality of Opportunities in a high-inequality country: The case of Chile," Working Papers wp292, University of Chile, Department of Economics.
    3. Francisco Parro & Loreto Reyes, 2017. "The rise and fall of income inequality in Chile," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 26(1), pages 1-31, December.
    4. Tejada, Mauricio M., 2016. "Lifetime inequality measures for an emerging economy: The case of Chile," Labour Economics, Elsevier, vol. 42(C), pages 1-15.
    5. Javier Núñez & Andrea Tartakowsky, 2007. "Inequality of outcomes vs. inequality of opportunities in a developing country. An exploratory analysis for Chile," Estudios de Economia, University of Chile, Department of Economics, vol. 34(2 Year 20), pages 185-202, December.

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    More about this item

    Keywords

    Wage inequality; labor market.;

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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